Greens Senators congratulate each other after the Government's Clean Energy (carbon tax) Bills were passed through the Senate. Image: Herald Sun

According to Master Builders, the CIE’s modelling expands on Treasury analysis and shows building and construction costs will increase by between 1.4 and 2.0 per cent by 2020 due to price increases in key emission-intensive inputs such as steel, aluminium, cement and glass - all key building material inputs of a new house.

They say it means that the cost of a modest new house will increase by at least $5,000 as a result of the carbon tax and that it comes on top of “economically reckless increases in mandatory energy efficiency stringencies for new housing that has recently added another $10,000 burden on new home buyers”.

Harnisch added that the carbon tax will also increase the costs of construction for hospitals and aged care facilities, as well as libraries and other community facilities.

“Community facilities and public infrastructure are also not immune from a price on carbon.

"There will be a direct impact on the Governments’ capacity to deliver much needed public infrastructure. Governments will be forced to either deliver less, or make households pay increased taxes and charges in response to the increased costs.

”Overall the loss in building and construction industry value added could be as high as $3.6 billion in 2020 or just over $24 billion in cumulative terms between 2013 and 2020 as a result of the introduction of a carbon tax.”