Chains fear carbon tax slug

Steve Lewis
16 March 2012
The Courier-Mail

SOME of Australia’s best-known small business chains – including 7-Eleven and Caltex Star Mart – are predicting the carbon tax will wipe 5 per cent off their profit.

In the latest challenge to the Gillard Government’s plan, the Australasian Association of Convenience Stores claims the carbon tax will be “strongly negative” for business operators who often have to operate their premises with 24/7 power.

A survey of the Association’s 80 members – which include BP and APCO petrol stations – shows more than two-thirds are worried about the impact of the carbon tax on costs.

Nearly 70 per cent of the Association’s members – who employ more than 13,000 people – believe the carbon tax will “negatively” impact on employment prospects.

AACS executive director Jeff Rogut said most members did not have the luxury of shutting off power.

“The nature of our 24-hours-a-day, 365-days-a-year industry means higher utility costs are already a source of serious pressure,” Mr Rogut said.

The latest concerns about the carbon tax came as Opposition Leader Tony Abbott and Prime Minister Julia Gillard tussled over the carbon tax’s impact on small business retailers.

Mr Abbott said media reports – revealing Westfield was including a clause in retail lease agreements to recoup carbon tax increases – showed the Government was “lying” about its impact. According to the Government, only the top 500 polluters will directly pay the carbon tax when it is introduced from July 1.

Mr Abbott said every business would be “passing those costs on to customers. That is the carbon tax rolling like a wrecking ball through our economy”.

But the Prime Minister said shopping centre landlords such as Westfield had been including such a clause in contracts for several years.

However, small business operators say they have only become aware in the past few weeks of specific clauses being inserted in retail lease agreements, forcing them to pay the extra costs.

Kenton Campbell, the boss of Gold Coast-based Zarraffa’s Coffee, said the special conditions were included in his recent lease negotiations with one of Australia’s prominent retail property groups.

The condition said “the Lessor may pass this carbon or greenhouse gas emission related charge on to and recover the same from the Lessee at cost”.

Mr Campbell warned that the logical end result of additional costs to businesses would result in staff cutbacks and layoffs.
“Everything will cost more as businesses pass on the tax to consumers,” he said.

“From major expenses such as home loans to life’s little luxuries like the simple cappuccino, Australian people will have to dig deeper into their pockets to cover the cost of this tax.”