Putting to one side the rights or wrongs of Australia’s new Carbon (Dioxide) Tax which came into effect on 1 July 2012 and imposed on the top 500 companies who will inevitably pass the tax on with higher prices, how does this new tax actually impact on Newsagents?
The Federal Treasury has estimated that this new tax will cost approximately an extra $9.90 per week on average. They have also estimated that consumer price index (CPI) is likely to increase by 0.7% in 2012/2013.
Small businesses (with less than $2m in annual turnover) will see their instant asset write-off increased to $6,500 and be able to access a $40 million Energy Efficiency Information Grants program. Interestingly, the Australian Newsagents’ Federation (ANF) (supported by NANA, VANA, QNF and WANA) was unsuccessful in attracting federal government grants to assist Newsagents in relation to the new carbon tax.
All that aside, NANA’s recommendation to Newsagents is that Newsagents can and must increase their retail prices of their goods and services IF AND ONLY IF Newsagents are also impacted by increased costs, fees and charges by their suppliers. Suppliers for Newsagents would include electricity providers, couriers, newspaper and magazine publishers, etc. Newsagents have for far too long absorbed costs to their own detriment in order to keep their retail prices low in order to maintain their customers' relationships.
Having said that, in the context of the Carbon (Dioxide) Tax, there must be a clear demonstration of Newsagents being impacted by this tax before Newsagents can increase their own retail prices for their goods and services. Ultimately, Newsagents must balance their decision of increasing their retail prices and their effect on customers. Newsagents cannot unilaterally blame retail price increases automatically on the Carbon (Dioxide) Tax especially without evidence. The ACCC has already reminded all Australian businesses against such actions on the basis that they may be considered misleading and deceptive conduct and therefore illegal.