Other businesses may also be affected as suppliers pass on the extra costs associated with the carbon price. In either case, businesses can choose to pass on their extra costs by increasing prices.
Businesses need to be aware that if they claim their prices have gone up or are about to go up because of the carbon price, they must ensure their claims are truthful, have a reasonable basis and do not mislead consumers or other businesses.
When making such claims in advertising and promotional material, or in sale pitches to customers, businesses should be careful not to overstate the impact of the carbon price. Put simply, if they choose to make a claim about the impact of the carbon price, they must have confidence in it.
Before making a claim
The type of information to consider before making a claim includes:
- invoices showing the impact of the carbon price on the supply chain or business input costs; for example, raw materials, packaging and transport, where relevant
- notices or invoices showing the impact of the carbon price on the cost of their services; for example, electricity, gas, waste disposal and travel
- invoices and other information showing the impact on their products or services before and after a price change (may be relevant for claims about a percentage change over a period of time)
- calculations from an appropriate business calculator that considers increased costs relevant to the business or industry
- information from professional advisers or consultants; for example, accountant reports showing the impact of the carbon price on the business’s input costs
- information from the relevant industry association and the Government which may provide guidance as to the likely price impacts as a result of the carbon price in certain industries.
When estimating the impact of the carbon price and setting prices, it is important that businesses determine prices independently of their competitors, and avoid discussions and agreements with competitors about the price impact of the carbon price.
Considering claims made by other businesses
Here are some tips that can help businesses avoid being misled by other businesses. First of all, look at what other suppliers are charging for similar products and services and what they are saying about the impact of the carbon price.
Second, think twice before taking up supplier offers which say, before 1 July, that prices have gone up due to the carbon price. Note that some businesses may flag their intentions early, but that is not necessarily misleading.
And finally, be cautious about phone calls or emails:
- offering to pay carbon price compensation into your bank account
- claiming you need to pay or transfer money to receive a compensation payment or tax refund
- asking survey questions about carbon and requesting business or financial details.
These may be scams. Information about how businesses can protect themselves from carbon price scams is available at www.scamwatch.gov.au.
What the ACCC can do
The ACCC does not have a role in formally monitoring, setting or restricting prices linked to the carbon price and cannot stop a business from putting up its prices as a result of the carbon price. It can, however, act against misleading claims if a business falsely links a price increase with the carbon price.
Further information
The ACCC has developed a series of products to help businesses and their advisers when considering making a claim. There are five business snapshots, including Carbon price claims – guidance for business advisers and Information to support your claims, as well as frequently asked questions available at www.accc.gov.au/carbon. A guide for consumers is also online.
If you have a complaint or inquiry, contact the ACCC Infocentre on 1300 302 502 or use one of the forms at www.accc.gov.au. Small businesses can also contact the small business helpline on 1300 302 021. And for information on how the carbon price works, visit
www.cleanenergyfuture.gov.au or call 1800 057 590.
