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S Africa collects huge revenue from carbon tax

Xinhua, July 4, 2012

The South African government has collected 2.384 billion rand (about 300 million U.S. dollars) from carbon emission tax since September 2010, Finance Minister Pravin Gordhan said on Tuesday.

Gordhan gave this figure in a written reply to a parliamentary question from opposition Democratic Alliance MP Darryl Worth.

The tax is imposed on carbon dioxide emissions above 120 grams per kilometer at 75 rand (about nine dollars) per g/km for passenger vehicles; and for double cabs at 100 rand (about 12 dollars) per g/km for carbon dioxide emissions above 175 g/km.

As Africa's largest economy, South Africa is also the continent' s biggest polluter, and is one of the 20 biggest emitters of greenhouse gases worldwide.

Nearly all of South Africa's power is generated by state- utility Eskom's coal-fired plants, making it impossible for companies to choose less carbon-heavy electricity, environmental groups complain.

To reduce carbon emission, the government imposed the carbon emission tax in September 2010.

In a further action, the government is looking to introduce a carbon tax next year to reduce harmful greenhouse gas emissions, although nearly two-thirds of emissions will be tax-exempt until 2020 to lessen the impact on industry.

As proposed by the treasury in its 2012/ 13 budget, a carbon tax of 120 rand (about 15 U.S. dollars) per ton of CO2e (carbon dioxide equivalent) would be levied for emissions above the thresholds. The levy would come into effect in 2013/2014, and increase by 10 percent a year until 2020.

But nearly two-thirds of emissions will be exempted from tax until 2020 to lessen the impact on industry.