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Australia to scrap carbon tax?

Prime Minister Tony Abbott reintroduced legislation to the Australian Parliament on Monday that would repeal a carbon tax that the nation's worst greenhouse gas polluters have to pay.

The opposition centre-left Labor Party and minor Greens party used their Senate majority in March to block the bills that would remove the 24.15 Australian dollar ($22.79) tax per metric ton of carbon dioxide that was introduced by a Labor government in July 2012. The bills were defeated 33 votes to 29.

But with new senators to take their seats on July 7 for the first time since Abbott's conservative coalition government took power in an election in September, the bills are expected to be passed by a narrow margin. Coal mining magnate and carbon tax critic Clive Palmer leads four new senators who have promised their allegiance to his influential Palmer United Party.

While introducing the bills to the House of Representatives where the government holds a clear majority, Abbott said on Monday that voters had rejected the tax by electing his government.

"The people have spoken and now it's up to this Parliament to show that it's listening," Abbott said.

Abbott said scrapping the tax would reduce household electricity bills by AU$200 a year and natural gas bills by AU$70 a year. Lower-income Australians who have been paid a share of the carbon tax revenue as welfare to compensate for higher prices would get to keep their compensation even after the tax is scrapped, he said.

"This is a bill to reduce the bills of the Australian people," Abbott said.

The bills are expected to be passed by the House of Representatives this week before going to the Senate next month.

But the Climate Institute, an environmental think-tank , released a poll on Tuesday that showed that the carbon tax was not as unpopular as it was when it was introduced two years ago.

The poll showed that opposition to the tax had fallen 22 percentage points to 30 per cent this year. Support for the tax had risen six points since 2012 to 34 per cent.

Abbott plans to replace the tax with a taxpayer-funded AU$2.55 billion fund to pay industry incentives to use cleaner energy.

Australia is one of the world's worst greenhouse gas polluters on a per capita basis due to its heavy reliance on abundant coal reserves to generate power.

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