Carbon Tax comes into effect

The Carbon Tax, one of the most divisive pieces of Government policy in recent times, came into effect on July 1, 2012.

Introduced by the Labor Government under Prime Minister Julia Gillard, the Carbon Tax was devised in an attempt to address climate change.

The Tax was rolled out with the Federal Government's aim to cut carbon emissions into the atmosphere by five per cent - 160 million tonnes - by 2020.

294 businesses have been directly affected by the introduction of this policy, requiring them to now pay $23 for every tonne of pollution they produce.

Under the Government's plan, the fixed-price Carbon Tax will transition into a floating-price emissions trading scheme in 2014.

The levy was designed as such to encourage Australia's biggest polluters to cut their greenhouse gas emissions.

The Carbon Tax, however, has attracted fierce rhetoric within the political and public sphere.

The Leader of the Opposition, Tony Abbott, has vehemently dismissed the value of the Carbon Tax, arguing local businesses would suffer, jobs would be lost and Australian households would ultimately pay the costs of the Tax.

In an attempt to undermine the Government's Tax, the Opposition launched an advertising campaign highlighting the Prime Minister's policy backflip.

In the lead-up to the 2010 election, Ms Gillard unambiguously ruled out introducing a Carbon Tax under her leadership. In early 2011 she received a barrage of criticism for rescinding her pre-election promise and announcing a tax on carbon emissions.

Mr Abbott has said that repealing the taxes would be among the first things he would do if he became Prime Minister.