Page 783 - Week 03 - Wednesday, 9 March 2005

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the territory but does not pay rates. As a result, the Commonwealth Grants Commission makes certain adjustments to the payments payable to the ACT, just as it does to Tasmania, just as it does to the Northern Territory where it also acknowledges some of the circumstances under which those jurisdictions operate.

The whole principle and understanding of federation, summed up in the commitment to an equitable distribution of commonwealth welfare funds, produces the result it does. For New South Wales and Victoria to jump up and insist that they are paying the way of the nation basically belies that accepted fact. And it is simplistic trash.

MR SPEAKER: The minister’s time has expired. Supplementary question, Mr Mulcahy?

MR MULCAHY: Thank you, Mr Speaker. In light of that confirmation that the ACT has been fairly treated, would the Treasurer agree to make representations to his Labor colleagues in New South Wales, who want to see the ACT position eroded, to encourage them to end their attempts to mislead the broader Australian community on this issue?

MR STANHOPE: Mr Speaker, I can assure Mr Mulcahy and all members of this place that Mr Quinlan will not hesitate to let New South Wales and Victoria know that they are talking simplistic trash. He has done it before, and he will do it again.

Budget—GST revenue

MRS DUNNE: My question is to the Acting Treasurer. In the lead-up to the introduction of the GST in July 2000, state and territory governments agreed to abolish certain taxes and to consider the abolition of other taxes. Subsequently, New South Wales has acted unilaterally to abolish the debits tax in that state. All jurisdictions in Australia have benefited from a strong flow of revenue from the application of the GST. Why has the ACT chosen not to take advantage of that revenue by abolishing more of the inefficient taxes that still apply in the ACT?

MR STANHOPE: To some extent I just answered the salient part of that particular question. That, of course, goes to the breadth of the revenue base within the ACT and the breadth of our economy. Our economy is changing. It is changing to the extent that the private-public mix is moving to a position where a significant number of the work force within the ACT is now engaged by the private sector. It is interesting that most of the dollars that spin around Canberra are still generated by government or government activity, but at least the employment base is changing and that augurs well for the future and the breadth of the economy and, in time, for our capacity to continue to look at the raft of taxes and charges that we rely on here in the ACT.

We do have a narrow revenue base. I have heard suggestions and read in recent days that we could just abolish stamp duty across the board in the ACT. That would have an enormous impact on our discretionary spending. It would render it impossible for us to provide the range of additional services that the people of Canberra demand and expect and quite rightly anticipate that the government will provide. We simply could not provide the range of services that we provide if we unilaterally removed stamp duty across the board or if we even did away with payroll tax.

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