THE Queensland Government has confirmed it will not mount a High Court challenge to the federal carbon tax despite the move affecting the state's "greatest asset".
Premier Campbell Newman agreed with radio commentator Alan Jones on 2GB on Tuesday morning when he suggested coal-fired electricity was Queensland's "greatest asset".
"It is, but they want to tax it out of existence," he said.
"I'm afraid to say, the legal advice says that this is not something we could probably challenge.
"We're not going to waste taxpayers money given that it indicates that, sadly, the federal drafters of this have done a good job of making it very bullet-proof and we're not going to waste money.
"If it had been 50/50 I would have been in there straight away because this is just economic madness.
"I say to Queenslanders today, this completely compromises our future ability to, say, have a new metal processing refinery or smelter.
"That'll all happen overseas.
"Now, we've had Labor saying for years 'Oh we shouldn't be a quarry. We shouldn't dig stuff up and send it overseas', well that's exactly what's going to happen.
"We will not process bauxite here. We will not process copper ores or nickel etcetera in this state."
Attorney-General Jarrod Bleijie said on Tuesday afternoon the government was opposed to the carbon tax because it would have a negative effect on industry development, jobs and the cost of living for families as companies passed on the cost of the tax.
"The Federal Government was deaf to these concerns, so we sought legal advice on the viability of a constitutional challenge," he said.
"Unfortunately, we've been advised that a challenge is unlikely to be successful, so we won't waste taxpayers' money fighting a losing battle.
"It's a disappointing outcome because this tax will hurt Queensland and Queensland families.
"It will also hurt business and the potential for new mining, refining and smelting operations in Queensland, which are energy intense.
"The result will be that value-adding businesses will move to overseas locations where they won't be subject to any carbon tax penalty."
Mr Bleijie said the LNP government remained resolutely opposed to the federal government's carbon tax.
He said Cabinet had resolved to show the cost of the carbon tax separately on all residential electricity bills from July 1.
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