No tax on imports to help BlueScope

Climate Change Minister Greg Combet has ruled out placing a tax on imported steel as a measure to help BlueScope deal with a carbon price.But he indicated emissions-intensive industries could expect a generous package of government money to pay most of their carbon tax bill.Mr Combet's comments came as the Federal Government's climate change advisor Ross Garnaut said the initial price on carbon should be set at between $20 and $30 per tonne of carbon dioxide and rise by about 4 per cent each year.Based on BlueScope's emissions from the Port Kembla steelworks of about 12 million tonnes of carbon dioxide equivalent per year, this would cost the company between $240 million and $360 million each year.Faced with the extra charge from July next year, BlueScope chief executive Paul O'Malley has called for a tax on steel imported from countries that do not have a carbon tax, so Australian steel can remain competitive.But yesterday Mr Combet told the Mercury he would not considering a tax on imports."No - it's not compatible with world trading obligations that we have," he said."The focus has to be on one or the other - protectionism, or coming up with a policy that significantly offsets the carbon liability for the steelworks so that the carbon price doesn't bring the competitiveness of the company into play."Mr Combet indicated the steel industry would be given an assistance package which resembled that developed under the Rudd government's carbon pollution reduction scheme, where 94.5 per cent of BlueScope's pollution permits were paid for by the Government."The Government has said that a lot of very good work was done on the last occasion on the assistance package for these industries," he said."We're not going to walk away from good work."His comments coincided with those of Professor Garnaut, who said assistance should be provided to emissions intensive, trade-exposed industries - such as BlueScope - to the extent they are "disadvantaged in sales prices by other countries not having comparable carbon constraints".Prof Garnaut said the "global recession buffer" in the CPRS should be removed, leaving the level of industry assistance at 90 per cent of their carbon cost.Also yesterday, Mr Combet said Opposition Leader Tony Abbott was "disgraceful" for saying people in China and Indonesia would be the beneficiaries of steelmaking jobs as manufacturing went offshore.Yesterday's front-page story carrying Mr Abbott's claims that steel jobs would go overseas sparked a furious debate on the Mercury's website. Most readers' comments ran against the carbon tax and several people said BlueScope was already doing its best to reduce emissions.