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The carbon tax is set to be introduced on 1 July 2012, and is likely to increase the cost of building materials used in housing constructions by up to an estimated 1.7%, depending upon the style, size and design of a home.
Builders will not be able to verify how much of the increase in the cost of materials is due to the tax and will need to rely on their suppliers for this information. Suppliers should also be aware that the ACCC has issued strict guidelines regarding misrepresentation of this information.
Moreover, it is important for builders to understand which costs they may pass on to their clients. Where a contract is signed prior to 1 July 2012 and there is a cost increase that the builder reasonably believes is due to the Carbon Tax (and the builder can show this) then the cost may be passed on to the client.