The agreement would have impacted our diesel fuel rebate scheme, which pays around 5 billion dollars to operators in the agriculture and mining industries each year.
Agriculture Minister Barnaby Joyce told the ABC the rebate is not a subsidy, it is simply paying back tax collected for use of public roads.
"If we did have the diesel fuel rebate removed, that would make lot of sections of your agricultural degree unviable. The margins because of the price of fuel, it wouldn't be worth putting a crop in. "
John Connor from the Climate Institute says there is an economic case to remove the diesel fuel rebate system.
He told the ABC the scheme also goes against the goals of the Paris climate summit.
The New Zealand Prime Minister led a charge for this, to make this more transparent and join other countries which are pricing in the fact that we are globally putting a half a trillion dollars of subsidies into fossil fuels, precisely what we're trying to turn around and stop emitting here at these talks in Paris."
Greens leader Richard Di Natale is supportive of the diesel fuel rebate scheme for agriculture, but not for the mining industry.
