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Legislative Assembly for the ACT: 1996 Week 11 Hansard (24 September) . . Page.. 3315 ..

MR SPEAKER: Order! Chief Minister, I did not hear that. Would you mind repeating it.

MRS CARNELL: Thank you very much, Mr Speaker. This represents less than one-third of one per cent of our total net assets - hardly selling off the family silver. This strategy protects our AAA credit rating and our strong net asset position.

This Government is conscious of the additional burden that increased taxes and charges place on Canberra residents, particularly at a time when the Territory is weathering an economic downturn. Once again, increases in taxes and charges have been held to no more than those of New South Wales, in line with our commitment to preserve the ACT's competitiveness and attraction as a place in which to live and do business. I can confirm today, however, that the ACT Government will keep its promise to small businesses in the Territory by lifting the payroll tax threshold to $800,000 over the next two years. What this means is that another 130 small- and medium-sized businesses will no longer be liable for payroll tax. In fact, by January 1998, all ACT businesses liable for payroll tax will be paying $13,700 a year less than their counterparts in New South Wales.

As a direct consequence of reduced levels of Commonwealth funding and the significant decline in Territory revenues, this budget does contain a number of minor new revenue measures. From 1 October this year, stamp duty on hiring arrangements will be introduced, applying duty to arrangements where goods are hired out by an owner in the ACT. The rates of duty will be in line with those in New South Wales and other jurisdictions, that is, 0.75 per cent for equipment leasing and 1.5 per cent for other leasing arrangements. To minimise the impact of this stamp duty on small businesses, a threshold of $6,000 a month will apply.

In line with other States and Territories, a debits tax will be introduced from 1 July next year. This will apply to withdrawals from bank accounts with cheque facilities and will be set at New South Wales rates. The Territory's rate of financial institutions duty will be correspondingly lowered to match the rate applicable in New South Wales, namely, 0.06 per cent. These adjustments to financial transactions taxes will partially address the assessment by the Commonwealth Grants Commission that the ACT is underutilising its capacity to raise revenue in this area, compared with other States. From 1 December this year a uniform rate of stamp duty on general insurance will be applied. This will increase the rate payable on motor vehicle insurance from 7 per cent to 10 per cent.

The Government has decided to introduce a cap on the general rates concession for all new eligible pensioners from 1 July next year. This decision will ensure that all existing pensioners will continue to be entitled to the benefits of the 50 per cent rebate and will provide new pensioners with sufficient time to plan their future rates payments. The cap will be set at $250, which is in line with the New South Wales average. The option of deferment will continue to be available to all pensioners who have difficulty meeting their rates obligations. The introduction of this capping will limit the erosion of revenue in future years as our population ages, but I stress again that the entitlements of existing pensioners have been preserved.

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