It looks as if someone within the government is flying a kite to see what reaction there might be to the ending of the Carbon Reduction Commitment (CRC).
This article appeared at the weekend, suggesting that CRC could be merged with other taxes following the publication of a number of so-called “discussion papers” for the 5,000 companies due to be affected.
As the piece points out, the news that more changes could be on the way will cast more confusion over the tax, which has been criticised for baffling businesses. It’s said, however, that doing away with the CRC would not necessarily mean that companies would have to pay less because its intended effects could be included in another green tax covering a wider number of businesses.
This year’s Budget is being held on March 23rd, and I’m told the future of CRC could be up for discussion in government circles around a week before, leading to the possibility that an announcement about the future of CRC – and a new green tax? – could be made in the Budget.
CRC was originally meant to reward companies for reducing their emissions and penalise those who failed to do so. But the Treasury seemed to pull rank on the Department of Energy and Climate Change when it decided to, as the article points out, ‘pocket the proceeds meant to go to good performers in order to help reduce the deficit.’
There is a degree of frustration about the government’s dithering over CRC, not least from companies who in good faith are trying to develop services around it, but find themselves twisting in the wind as the government goes back and forth over its future. Leaks like the one at the weekend don’t help them. And they certainly don’t help organisations – and particularly their CIOs and Finance Directors – looking for some policy certainty going forwards.