Legislative Assembly for the ACT: 2008 Week 03 Hansard (Tuesday, 1 April 2008) . . Page.. 752 ..
number of months on public education because they have got nothing to say—nothing positive to contribute to what is the majority provider of education in the ACT. The Liberal Party have nothing to contribute. The best that they can do is to reheat a 12-month old Labor Party policy and try and claim it as their own. Pathetic!
MS MacDONALD: My question is to Mr Stanhope in his capacity as Treasurer. Treasurer, what does the Commonwealth Grants Commission’s latest 2008 update report—relative fiscal capacities of the states 2008, have to say about the ACT government’s taxation effort?
MR STANHOPE: I thank Ms MacDonald for the question. It is important that we focus on the Commonwealth Grants Commission’s 2008 update because it does put the lie to many misrepresentations of the true state of the ACT government’s taxation effort doing the rounds at the moment. It is quite common to hear misrepresentations of taxation effort and taxation levels within the territory.
As members would be aware, the Commonwealth Grants Commission provides an annual assessment of the relative fiscal capacities of the states. This includes an assessment of the revenue-raising effort of all of the states and of the two territories. The commission in effect determines a state or territory’s capacity to raise tax relative to other jurisdictions, taking into account its specific circumstances. It then determines how the state or territory has actually performed against that capacity in taxation revenue raising—the so-called revenue-raising effort.
The commission’s latest update, the 2008 update, was released only a few weeks ago and it shows—in fact proves—that the ACT is not a high taxing jurisdiction. The commission’s 2008 update shows that the ACT’s taxation effort in 2006-07 was l05 per cent—lower than South Australia and broadly in line with New South Wales, Victoria and Western Australia. In fact, the taxation effort in the ACT is essentially identical to the taxation or revenue-raising effort of New South Wales, Victoria and Western Australia.
Moreover, the ACT’s taxation effort relative to other states and territories actually declined between 2005-06 and 2006-07 by 0.7 per cent; in other words, we reduced our taxation effort between 2005-06 and 2006-07 by 0.7 per cent. Most particularly, in comparison to New South Wales in that same period, New South Wales’s taxation effort increased by 0.7 per cent. This is a very important point—a point that not only are you unlikely to see made in the local media but that I have never seen made—that the ACT’s relative taxation effort actually decreased, while across the border in New South Wales the taxation effort increased in the same period.
We would all like to pay less tax—everybody would. But the independent, rigorous and quality assured assessment from the Commonwealth Grants Commission puts to rest the claims and the misrepresentations that are continually made—by vested interests, it has to be said—in the ACT about our taxation effort. Land tax is a very good, pertinent and relevant example. It is particularly in relation to land tax that one sees the most continuous misrepresentations of the true state of the ACT