The Business Council of Australia (BCA) yesterday called on the federal government to set targets for Australia to cut greenhouse gas emissions.

The BCA has backed a carbon emissions trading scheme with targets that will put a price on greenhouse gas pollution.

As part of a submission to a government task force examining the issue, the council has called for immediate and long term targets.

The council represents Australia's biggest companies including BHP Billiton, Rio Tinto and BP.

The federal government has been reticient to set targets for Australia with the prime minister John Howard criticising Labor's call for a 60 percent cut in emissions by 2050 claiming it will damage the national economy.

However, the prime minister has shown some support for an emissions trading scheme which would put a price on carbon in the future.

The BCA has also said it will not support Labor's 60 percent target and did not provide any figures of its own.

In the trading scheme proposed by the BCA the council wants to give the highest polluting industries free permits for their emissions to compensate them for economic losses. It also wants to provide support to energy-intensive industries such as steel and aluminium.