Environment groups call for more transparency on carbon tax hike, 'discounts' for large emitters

Several environment groups in Singapore are pressing the Government for more clarity on how much the carbon tax will be raised from 2028, and for more transparency on tax "discounts" given to some large emitters here.

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In an open letter to the Government released on Sept 9, the four groups also urged the authorities to protect low-income households from higher electricity bills amid carbon tax hikes.

The letter was penned by youth-led initiative Energy CoLab, as well as environment groups LepakInSG, SG Climate Rally and Singapore Youth for Climate Action.

They said: "An effective carbon tax should protect our people, not fossil fuel companies."

Singapore's carbon tax — which puts a price on greenhouse gases so that polluting firms will slash their emissions — first went up from $5 per tonne of carbon dioxide (CO2) emissions to $25 per tonne of emissions in 2024 and 2025.

This will increase further to $45 per tonne in 2026 and 2027. By 2030, the tax rate could be $50 to $80 per tonne, the Government earlier announced.

The letter read: "As the carbon tax amount beyond $45 per tonne of CO2 must be decided upon before 2028, and firms will require sufficient time to adjust, it is timely to review the tax and its associated measures now."

They added: "This will also allow adequate time for public consultation."

There are roughly 50 carbon tax-paying facilities in Singapore, mainly from the manufacturing, power, waste and water sectors. These emitters are responsible for about 70 per cent of total national emissions.

The Straits Times reported in June that the expected revenue from Singapore's carbon tax for 2024 — the year the tax rate increased fivefold to $25 — is lower than expected.