An Inconvenient Tax – Carbon Tax ignores Convenience Industry

Dear Members,

There has been much spoken and written about in recent days regarding the new carbon tax. From a small business perspective there was little relief evident. AACS supports sustainability and doing what we can as an industry to be more environmentally responsible. In many cases reductions in use of resources makes good business sense, and many Members have their own initiatives in place. However from an industry support perspective, AACS position which has been made to the media is as follows:

AN INCONVENIENT TAX – CARBON TAX IGNORES CONVENIENCE INDUSTRY

Despite the exemptions for small businesses unveiled as part of the Government’s carbon tax scheme, convenience stores at the consumer frontline will still be faced with increased costs that will have to be dealt with in one of two ways: by passing costs on to consumers or absorbing them at the expense of profitability. And according to the Australian Association of Convenience Stores, the peak body for the convenience industry in Australia, the second option is unsustainable given the existing cost burden already being experienced by the sector.

“Convenience stores are at a critical juncture in terms of their ability to compete with the bulk buying power of the major supermarkets. Overheads are already exceptionally high, and the nature of these 24 hours a day, 365 days a year small businesses means higher utility costs are already a source of serious pressure for convenience stores,” explained AACS Executive Director Jeff Rogut. “The carbon tax will have the immediate effect of raising utility costs further, increasing the cost burden. Then there are the flow through increases, such as rising costs for food manufacturers, which will undoubtedly be passed on. “The buck stops with convenience stores. The carbon tax will sit alongside rising costs of labour, security, penalty rates, ‘drive-offs’ on petrol sites as just another cost to be borne by an increasingly hamstrung convenience store sector,” Mr Rogut said.

“In a market that’s becoming skewed more and more towards the major chains at a time when retail trading conditions are tough, the Government has ignored convenience stores, which are. In the main family run small businesses in its carbon tax modelling,” Mr Rogut said.

Jeff Rogut  FAIM

Executive Director
Australasian Association of Convenience Stores