Page 816 - Week 03 - Wednesday, 2 April 2008
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revised forward estimate of $196 million in surplus for this financial year, and for the first time ever the estimate of total taxation revenue for this financial year has now exceeded $1 billion. This is a huge increase in taxation since the Stanhope government came to power.
If we go back and look at the 2001-02 financial year when the Stanhope government first took office, we see that the total tax burden in the ACT, including all regulatory fees and fines, was $631 million. What this means is there has been an increase in taxation of 58.5 per cent in the time that the government has been in office. This is an increase of almost 8 per cent per annum, well ahead of growth in the economy and also well ahead of growth in wages and a burden, of course, for those famous working families that the ACT government and their federal colleagues so often trot out.
The fire and emergency services levy was introduced in the 2006-07 budget. In that budget, the government noted, and I quote:
With the exception of the Northern Territory, all other jurisdictions impose a fire levy as the primary source of funding for fire services.
What they did not say, of course, was that the revenue raised by the fire and emergency services levy goes straight into general revenue; it is not specifically earmarked for fire services. The fire and emergency services levy was an unnecessary imposition on taxpayers, which was justified by the government on the basis of its shoddy revenue estimates, figures which have now been shown to have been drastically underestimated.
The levy is imposed on all rateable properties in the ACT, adding to the already substantial costs of rates bills borne by property owners. Of course, these costs are also passed onto renters so that they, too, suffer from the imposition of the levy. For residential properties, the level is set at $84 per annum with a 50 per cent rebate for pensioners eligible for rates rebates. For commercial properties, the levy is determined by using the unimproved value of land.
Mr Speaker, as with my proposal to repeal the utilities tax, the reform I am proposing is also a modest tax reform in terms of revenue impact. The fire and emergency services levy is forecast to generate $21.683 million in revenue in this financial year, and this amount is slightly over 10 per cent of the budget surplus that the government is forecast to achieve with its continual increases in taxes and charges over the last few years. Even if the government were to repeal both this levy and the utilities tax, this would still be a modest tax reform, amounting to a loss of revenue of $32.218 million, less than 20 per cent of the projected surplus for the year. While modest, such a reform would at least be some small start in reining in the ravenous tax regime of the ACT government.
It is pertinent to note that these taxes have been imposed by the government on the basis that they were allegedly needed to balance its budget. If this were really the case, then the government should now be looking to repeal its tax increases in line with its enormous war chest of revenue, and, with credit to the government, they can now boast the strongest balance sheet of any jurisdiction in the country. But that ought to also bring with it benefits to the people of Canberra by way of reductions in tax.
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