Page 4110 - Week 13 - Wednesday, 18 November 2015

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(a) maintain its commitment to reforming the Territory’s taxation system;

(b) outline a program for the next five years of taxation reform, including analysis about rates increases on households and businesses; and

(c) table this five year program with the 2016-2017 ACT Budget.

The amendment that I have put forward outlines the government’s commitment to taxation reform and notes the opposition’s continued refusal to engage in anything more than slogans and repeating the same speech that has been given in this place ad nauseam in this parliamentary term. This reflects the position of the longest serving shadow treasurer in the history of Australia. It is not surprising but it is worth dwelling on just how little there has been from the opposition on tax in spite of this being one of the biggest issues of public policy debate in this country at this time.

Tax systems around the country are recognised as being in need of reform. It is recognised by the federal government. It is recognised by every credible economist and policy analyst. It is recognised by the media, by the public and even by a number of Liberal politicians elsewhere in Australia. Expert report after expert report in recent years and decades has advocated taxation reform. Here in the ACT we have actually got on with delivering it.

Mr Smyth’s motion seems to have missed the fact that stamp duty has been cut significantly in every budget for which I have been Treasurer and it will continue to be cut in every budget that this government delivers. Insurance duty has also been cut. Insurance tax is one of the worst taxes levied by state and territory governments. It taxes a service, a good that households and businesses should have. And that is why over the past four years it has been cut from 10 per cent to two per cent and why it will be fully abolished on 1 July next year. An average household with home, contents and comprehensive car insurance with combined premiums of around 2½ thousand dollars a year is today $200 a year better off as a result of those cuts and that will rise to $250 after 1 July next year.

We have been cutting stamp duty in every budget. To give a quick indication of how households are benefiting, the buyer of a $500,000 home is currently paying $5,900 less in stamp duty than before tax reform. A buyer of a $700,000 Canberra home is saving $7,400 on what they would have paid prior to reform.

Our own-source revenue is transitioning away from transaction taxes to more efficient forms of taxation because rates are an efficient and fair way of raising revenue to fund the services and facilities our community needs. Prior to tax reform rates were increasing every year and had done so throughout the history of self-government and throughout the history of this city. That there will be an increase in rates every year has been a given for as long as all of us have been alive.

What has changed as part of the tax reform process is that an element of additional rates increases has funded the abolition of or reduction in three other taxes—insurance taxes, payroll taxes and stamp duty. And the benefits that have been delivered to businesses, particularly through the series of payroll tax cuts, amount to tens of thousands of dollars annually. Businesses, particularly small businesses in the ACT,

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