Extract from ABC News 24 Website:
Updated
The Federal Government has confirmed it will scrap the carbon tax and move to an emissions trading scheme (ETS).
Treasurer Chris Bowen says the decision will cost several billion dollars and savings will have to be found.He says cabinet has approved the plan to move to an ETS next year - a year earlier than originally planned.
The fixed carbon price of $24.15 a tonne will be removed in favour of a floating price, thought to be between $6 and $10 a tonne.
Mr Bowen says the Government will keep the carbon tax compensation package for families, but has told Channel 10 there will be spending cuts in other areas to pay for the change.
"We understand very much the cost-of-living concerns in the community," he said.
"We understand that deeply, and any revenue decisions we make will have that front of mind.
"I think that will be clear when we announce the details in coming days."
Speaking later in Cairns before a planned visit to Papua New Guinea, Prime Minister Kevin Rudd dodged questions on where cuts will be made, saying those decisions are still under discussion.
"It necessarily has to be budget-neutral. The key thing though with this change, it would mean that Australian families have less cost-of-living pressures and it would also mean strong action still on climate change," he told reporters.
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