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Legislative Assembly for the ACT: 2001 Week 5 Hansard (1 May) . . Page.. 1305 ..

MR HUMPHRIES (continuing):

After taking these into account, the net increase in Commonwealth funding to the ACT for 2001-02 is approximately $55.5 million. The ACT successfully defended this increase in Commonwealth funding against a wave of ill-informed criticism from both the Victorian and New South Wales Labor governments.

The ACT is a donor state to the federation and, in per capita terms, is the largest net contributor. What that means is that, after analysing the amount of tax paid by Canberrans to the federal government and comparing that to the total amount of Commonwealth funding redistributed from the Commonwealth to the ACT, each and every Canberran contributes $1,460 more to the federation than we receive back. The ACT also has a very real case for additional funding on a number of grounds. For example, the ACT cannot levy payroll tax on its largest local employer, the federal government, and cross-border services to New South Wales involve considerable outlays.

Revenue initiatives

Mr Speaker, I am proud to say that this budget returns revenue to the people of Canberra. Most significantly, the government has decided, after community consultation, to return $10 million a year directly to the community through a reduction in motor vehicle and motorbike registration fees for both business and private vehicles. This means a cut of $58 per vehicle per year. Registration fees will be $17 lower than in New South Wales and will apply from 1 July this year. This measure will help reduce motoring costs, a major factor in almost every family budget. During 2000-01 the government put in place tax reform measures that have put more dollars back into the hands of residents and businesses.

Taxation measures to take effect during 2001-02 include:

More Canberra businesses will be free of the burden of payroll tax. Payroll tax is nothing more than a tax on employment. Less payroll tax means more jobs. As announced in last year's budget, this government will increase the tax free threshold from $900,000 to $1.25 million from 1 July 2001, with a further increase in July 2002 to $1.5 million. This makes the ACT threshold the highest in Australia, reinforcing the national capital as a great place to do business.

As foreshadowed at the commencement of the GST on 1 July last year, financial institutions duty and stamp duty on quoted marketable securities will cease to apply on 1 July 2001.

As announced last year, the removal of the insurance levy will return $10 million to policy holders in the territory.

This return of revenue is a matter of keeping faith with the community. This money came from taxpayers' pockets in the first place. We have a surplus. We should return that money to them.

Expenditure initiatives

I now turn to specific expenditure initiatives. The budget contains a very large number of well-targeted initiatives, and I will be able to highlight only some of these in this speech.

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