Australian opposition pledges carbon tax will go

Australia's Prime Minister Kevin Rudd speaks during a press conference at the Parliament House in Canberra, Sunday, Aug. 4, 2013. Prime Minister Rudd called an election on Sept. 7 and said Sunday that it will be fought over who can be trusted to manage the Australian economy as it transitions from a decade-old mining boom fed by Chinese industrial demand that is now fading.(AP Photo/AAP, Lukas Coch) AUSTRALIA OUT

CANBERRA, Australia (AP) — Australia's conservative opposition party is casting the looming election as a referendum over a contentious carbon tax, pledging on Monday that scrapping the tax would be its first priority if it regains power.

The major political parties as well as the public are bitterly divided over whether Australian industrial polluters should be forced to pay for the carbon dioxide and other greenhouse gases they produce. Australians are among the world's worst emitters of such gases on a per capita basis.

The issue rose Monday when Virgin Australia, the nation's second largest airline, blamed a carbon tax bill of up to 50 million Australian dollars ($44 million) for blowing up its forecast loss for the last fiscal year to as much as AU$110 million.

It was the first full day of campaigning after Prime Minister Kevin Rudd on Sunday set a Sept. 7 election date.

Opposition leader Tony Abbott said he told the head of the Prime Minister's Department in a letter on Monday to make arrangements to repeal the tax so "we can move swiftly, if elected."

"If this election is about anything, it is about the carbon tax," Abbott told reporters.

"Getting rid of the carbon tax is fundamental to our plan for a stronger economy," he added.

But while the letter might have demonstrated Abbott's resolve, he is unlikely to win the Senate majority he would need to be certain of repealing the tax.

Rudd's predecessor as Prime Minister, Julia Gillard, created the carbon tax in a deal with the minor Greens party whose support enabled her to cobble together a minority government after the 2010 election.

By breaking a pre-election promise never to introduce such a tax, Gillard triggered angry protest rallies and damaged her center-left Labor Party's standing in opinion polls.

Disastrous polling led to Rudd ousting her in an internal government leadership showdown in June. She had replaced him in similar circumstances in the face of a polling slump three years earlier.

Rudd has now promised to tinker with the carbon tax law if re-elected to reduce the cost to polluters.

The tax is due to be replaced in 2015 by an emissions trading scheme. Rudd has pledged to bring forward the scheme linked to the European market by a year to July 2014, slashing the cost of producing a ton of carbon dioxide to less than a quarter.

But Abbott's Liberal Party-led coalition opposes any charge for greenhouse gases. It plans to reduce the nation's emissions by paying industry taxpayer-funded incentives to reduce pollution.

The conservatives dumped their own policy of making polluters pay after a United Nations climate conference in Copenhagen in 2009 failed to agree on a global pact on reducing greenhouse gas emissions.

An opinion poll published in The Australian newspaper Monday found that support for the government trailing the opposition 48 percent to 52 percent.

But Rudd, a Mandarin-speaking former diplomat, held a commanding lead over Abbott, a former Roman Catholic seminarian, as the better prime minister. Rudd had 47 percent support, Abbott 33 percent and 20 percent of respondents were undecided.

The poll by Sydney-based market researcher Newspoll was based on a random nationwide telephone survey of 1,147 voters at the weekend. It has a 3 percentage point margin of error.