The consumer watchdog is questioning a major bakery franchise following an internal newsletter that advised bakeries to put up prices and ''let the carbon tax take the blame''.
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The Australian Competition and Consumer Commission is currently looking into Brumby's Bakery - which bills itself as one of Australia's ''largest and most successful franchise groups'' - about potentially misleading claims about the tax.
In a copy of a June 2012 "Backmix" newsletter - first detailed in the West Australian - Brumby's managing director Deane Priest provides tips to ''find some extra sales''.
''We are doing an RRP review at present which is project to be in line with CPI, but take an opportunity to make some moves in June and July, let the Carbon tax [sic] take the blame, after all your costs will be going up due to it,'' the newsletter says.
A spokesman for the ACCC confirmed today that the watchdog would question the bakery franchise, which has more than 320 outlets in Australia and New Zealand.
''In light of the comments made in the newsletter the ACCC will be making inquiries of Brumbies [sic],'' the ACCC spokesman said.
''The ACCC would be concerned if any franchisor encouraged or induced its franchisees to make misleading price claims about the impact of the carbon price.''
If the ACCC finds there has been wrongdoing, it can issue warning letters, infringement notices of $6600 or take court action with fines up to $1.1 million.
The ACCC said that businesses were entitled to increase their prices as they see fit, ''so long as any claims or representations made about the impact of the carbon price are truthful and have a reasonable basis.''
The watchdog also encouraged consumers to shop around and ''think twice'' about carbon tax price representations.
Assistant Treasurer David Bradbury warned businesses not the "jack up their prices" and blame it on the carbon tax.
"This sort of behaviour is reprehensible," he told reporters in Sydney.
He said the ACCC - and the courts if necessary - would determine if Brumby's had broken the law.
Last month, Mr Bradbury warned businesses about ACCC penalties after the Opposition distributed posters - that blame the carbon tax for price hikes - to small businesses.
Opposition small business spokesman Bruce Billson said the Coalition posters were accurate and explained government policy.
At the time, Small Business Minister Brendan O'Connor said the impact of the carbon tax on small businesses will be modest.
''We think about $4 or $5 a week for a very small business doing their job,'' he said.
Retail Food Group, which manages Brumby's, has been contacted for comment.
When asked about the Brumby's situation, Opposition Leader Tony Abbott said that people needed to be "fair dinkum", but that every single business in Australia would be looking at costs due to the carbon tax.
"I think that every business in Australia is going to be under cost pressure," he told reporters while visiting a cordial manufacturer in Adelaide.
"Sure, businesses have got to be fair dinkum, there can be no rip-offs."
Mr Abbott said that the carbon tax was an "economic disaster".
"I will not rest until this tax is gone," he said.
