Page 3401 - Week 11 - Wednesday, 14 November 2007
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I am supporting Mr Mulcahy’s bill, but I want to see it replaced by another revenue-raising bill. I do not want to see any tax cut revenue merely transferred from the ACT government to the federal government through the GST to be doled out in doses as the federal government chooses. Of course, it is very interesting that all the focus is on income tax cuts without anyone going the next step and seeing where those cuts are going. They will be spent on goods and services, which attract the GST. The community may be being misled about the fact they are getting tax cuts at all. They are just merely the displaced tax cuts, ones that they are less likely to notice.
Before the introduction of the utilities tax, utility network owners were not charged for the network infrastructure that they operated on unleased ACT land. It makes sense to charge them to help compensate for the direct costs of maintaining those easements and utility corridors and for the opportunity costs of not being able to sell or otherwise use that land. As I said at the time, the Greens’ opposition to the utilities act, and the reasoning behind my support today of Mr Mulcahy’s bill, is supported by three key recommendations from the February 2004 public accounts committee report on revenue-raising issues in the ACT.
Recommendation 6 of that report encouraged the government to consider more progressive taxes. Recommendation 11 called on the government to establish a comprehensive concessions policy, and recommendation 15 requested that the government consider the feasibility of incorporating environmental concerns into revenue-raising measures.
Adverting and adapting to climate change will require actions across the government, and the revenue-raising system has an important role to play. It can be fashioned to be simultaneously a carrot and a stick, and it is one of the government’s most powerful tools to effect positive social and environmental outcomes. The fact that the utilities act makes no attempt to address environmental or social concerns is perhaps not surprising considering that the previous head of treasury expressed the view in a public hearing that the market, left to its own devices, would address all ethical and, presumably, environmental problems.
Many cities are providing or considering providing free wireless access to the internet in their CBDs. If this happens in the ACT, it will undermine the utilities tax, based as it is on infrastructure length. It will also take away one of the prime rationales for the form of the utilities tax provisions, as it will remove most of the revenue gained from telecommunications utilities.
The desire to extract revenue from Telstra was an important factor in determining the nature of the utilities act after the High Court case proscribing tax discrimination against telcos. As this factor becomes less important, perhaps the government could revisit the utilities tax and fashion its replacement with more of an eye to broader future benefits apart from mere revenue raising. If telcos were excluded from the utilities tax provisions, the government would be able to apply different tax rates to different categories and sub-categories of utilities. For instance, it would be able to impose a tax rate which was proportionate to the amount of green energy travelling through the system.
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