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Legislative Assembly for the ACT: 1997 Week 6 Hansard (19 June) . . Page.. 1911 ..

resource allocation distortions by creating a level playing field for government and private businesses.

The tax equivalent regime subjects government businesses to the same tax requirements as the private sector. In addition to state and local government taxes and charges, government businesses will be subject to the equivalents of Commonwealth income and sales taxes.

Under the Statement of Policy Intent signed by the Commonwealth and all States and Territories, the ACT will raise from ACT government businesses an amount of income and sales tax equal to the amount which would be paid by them to the Commonwealth if they were not exempt as Territory bodies. To ensure revenue neutrality the Statement of Policy Intent guarantees that each government will retain the tax collected from its businesses.

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