The consumer watchdog is warning businesses that display an anti-carbon tax poster being distributed by Tony Abbott’s office and don’t back up a price hike could be in breach of the law and face a court penalty of up to $1.1million.
Abbott and the Coalition’s small business spokesman, Bruce Billson, have sent out over 7,000 of the posters to businesses including bakers, bottleshops, butchers, cafes, dry cleaners and fruit shops.
The posters state: ”We always strive to keep our prices at reasonable levels but because the carbon tax will make electricity and gas more expensive, our prices will increase. We apologise for these price increases.”
The Federal Government jumped on the gaffe and warned businesses to be “very, very careful” about being part of Abbott’s campaign by displaying the posters in their shop fronts.
“Don’t allow him to drag you into his cynical scare campaign because the consequences of that are very serious,” Assistant Treasurer David Bradbury told Parliament yesterday.
“If you do mislead your customers, then you could face fines of up to $1.1 million.”
A spokesperson for the Australian Competition and Consumer Commission told SmartCompany it was aware of the posters and although they did not in themselves raise concerns, if the posters were displayed and prices increased, the increase needed to be justified.
“It is important that businesses that use the flyer do so in a manner that won’t mislead consumers by confusing other price increases unrelated to the carbon price,” the ACCC said in a statement.
“The ACCC’s role in relation to carbon pricing is the same here as in any other area – to make sure consumers are not misled. Claims used must be truthful and have a reasonable basis.
“The ACCC wants to ensure that consumers are not duped into accepting a price increase for a product or service because of the carbon price, when the carbon price is not the cause or the only cause.”
If a business is in breach the ACCC has various causes of action available to it including writing to the businesses, issuing an infringement notice $6,600 for an individual and $66,000 for a company or taking court action which can result in a fine of $1.1 million at the judge’s discretion in cases of serious conduct.
Billson defended the posters to SmartCompany and accused the government of scaremongering businesses.
“We have been advised that the flyers will not cause problems for small business owners who backup their price claims,” Billson said.
“For the Gillard government to threaten small businesses with $1.1 million fines for sticking up these posters is just plain wrong.
“The government jumped the gun in scaring small businesses before getting advice from the ACCC.”
The blunder comes as the ACCC investigates dubious price rises in the countdown to Sunday’s start to the carbon tax.
The watchdog has launched a Carbon Price Claims Hotline where businesses and consumers can complain about false or misleading carbon price claims.
Cara Waters is the editor of SmartCompany. Cara was previously a senior reporter at the Financial Times website FT Adviser in London and has also worked for The Sunday Times.
