1. Australian Carbon Tax

2. What is it? Australia's parliament has passed landmark laws to impose a price on carbon emissions in one of the biggest economic reforms in a decade. It sets a fixed carbon tax of A$23 ($23.78) a tonne on the top 500 polluters from July 2012, then moves to an emissions trading scheme from July 2015. Companies involved will need a permit for every tonne of carbon they emit. The scheme's impact will be felt right across the economy, from miners to LNG producers, airlines and steel-makers and is aimed at making firms more energy-efficient and push power generation towards gas and renewables.

3. Why are they imposing the tax? Australia accounts for just 1.5% of global emissions, but is the developed world's highest emitter per capita due to a reliance on coal to generate electricity The vote is a major victory for the embattled prime minister, Julia Gillard, who staked her government's future on what will be the most comprehensive carbon price scheme outside Europe despite deep hostility from voters and the opposition. It is almost double the European cost of $8.30 to $12. The carbon price will impose a cost on every tonne of carbon emitted, giving companies a financial incentive to curb pollution, and will help Australia reach its goal to cut emissions by 5% of 2000 levels by 2020.

4. Controversies At a time when many economies seem to be teetering on the brink, critics argue vehemently that it is foolish to levy new taxes that will stifle economic growth and cost jobs, but Australian PM Julia Gillard thinks that now is the time to be ahead of the curve on the environment. She says the new tax will eliminate about 159 million tons of carbon emissions annually. lthough she promised in her election campaign not to implement a carbon tax, she now says it is vitally important for the country’s long term future. She claimed that although her tax proposal would cost the average Australian household money, it is nowhere near the $300 that her opposition claims, saying their figures are merely “scare tactics”. The opposition is saying the PM can not be trusted, because she went back on her promise not to seek a carbon tax.

5. Quantas estimates the tax will initially cost the airline about $US115 million per year. Tony Abbot went on to characterize the tax’s effect on Australians, “Look, this is the mother of all taxes. In the first instance this tax will hit your power bills, it will hit your petrol bills but eventually this tax hits every price in the economy. You turn on the lights, you pay the tax. You put petrol in your car, you pay the tax. You open your wallet, you pay the tax,”