Coal & Allied would also be among the worst hit by a carbon tax, while Wesfarmers would only forecast a fall of 1%.

In the detailed report, which looked at the effects the coal tax would potentially have on coal miners, Citi analyst Elaine Prior said net profit after tax for “pure play” coal miners would drop about 4% for a carbon price tag of $20/t.

The report predicted coal mining would more than likely be included in the carbon tax that could start as early as next July.

While Prior acknowledged the coal industry’s backlash to the proposal, including threats of shutting mines down, job losses and abandoned future projects, Citi’s overall interpretation of the data was cloudy.

“For most mines the financial impact of the carbon is likely to be relatively small and we expect some assistance for particularly gassy mines,” Prior said.

“Hypothetically, a carbon price might slightly bring forward closure of a highly gassy mine.”

The Australian government indicated it would consider assistance of some type for gassy mines, which should benefit BHP Illawarra Coal.

This report comes days after a survey by the Australian Coal Association found the proposed carbon tax could strip 4700 jobs out of the black coal mining industry in three years and cost the industry $22 billion in its first nine years.

The Citi bank report recognised the Australian Coal Associations proposal of a phased approach, which included the auctioning of permits to trade exposed industry including coal, at a gradual rate, and inclusion of fugitive emissions only in step with competing coal exports.

Citi’s alternative to a carbon tax was that coal mining be treated as an emissions-intensive trade exposed industry, however, the report then noted this as “unlikely”