Trust the market – why regulation won’t stop carbon tax gouging

Price-gouging might occur under the carbon tax regime, but market discipline will keep it in check. Flickr/dmcneil

Federal Treasurer Wayne Swan has announced that the government will provide the competition watchdog with almost $13 million in extra funding to tackle carbon tax-related price-gouging.

In this context, price-gouging refers to business inflating prices beyond the cost increases reasonably attributable to the tax.

The Australian Competition and Consumer Commission’s extra funding will go toward hiring a team of 20 staff dedicated to identify and investigate price-gouging.