Page 2626 - Week 08 - Thursday, 24 August 2006
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which has all the information you need to work out where the territory is going in the broad. It gives figures for state final demand, employment, unemployment, population, consumer price index, gross domestic product and ACT gross state product.
But this year’s chart does not have the measure in it that will be used to determine how our rates are paid, and it is the WPI, the wage price index. The chart on page 9 of the Treasurer’s response to the committee’s report—and I thank the Treasurer for that—shows how much more money the WPI raises above the CPI. This year it will be 1.3 per cent, or $1.8 million. In 2007-08, it is projected to be 2.5 per cent higher than the CPI, bringing $3.7 million to the territory. In 2008-09, it is projected to be 3.8 per cent higher than the CPI, raising $5.7 million. In 2009-10, it is projected to be 5.1 per cent higher than the CPI, raising $7.9 million. As the shadow Treasurer pointed out yesterday, over the four years it will bring the territory almost an extra $20 million. That is without any justification at all and without any acknowledgement of the impact it will have on some groups, particularly on concession holders, self-funded retirees and those who are on fixed incomes. All of these fixed incomes increase annually by the CPI.
This government talk about equity and about caring. This government want to look after the little guy. Yet, by moving to WPI, they will punish them in the most punitive manner. No other jurisdiction in the country uses the WPI. We should not be bound by the fact that nobody else does it and we should be free to try things, but the justification for the WPI is simply a grab for cash because this government is bereft of ideas on how to raise revenue. It is attacking the sector that gives it a return. It is business that provides employment and investment. It is business, particularly the tourism industry, that provides most of the land tax and other taxes. What does this budget do? It cuts the funding to those groups. The Treasurer’s short-sighted, narrow interpretation shows his lack of understanding and his lack of engagement with the business community. This budget attacks the business community.
We want to move away from land-based revenue but we are going to tax the land base in a higher manner. We are going to apply the WPI and at the same time we are going to reduce the funding to business. The tourism minister called it business welfare. When he was asked to outline what he meant by business welfare, he could not. It was just a glib line to defend the indefensible.
There is an Access Economics report for the financial year 2003-04, delivered in 2004, that says that the government received something like $107 million worth of tax from the tourism industry. At that stage we were investing, depending on how you account for it, somewhere between $20 million and $22 million in tourism. That is about a five to one return: for every dollar you spend, you get five back. That is not a bad investment. I wish that every time I spent a dollar, I got five back, and I am sure the government does.
What did we do? At a time when everyone else is increasing expenditure on tourism, indeed on business, we cut our expenditure. It will get harder and harder to get business to come to this jurisdiction. In the end it is business that employs and business that pays through the taxes that we impose upon them. It is business that provides the money that keeps the hospitals, schools and the police force operating. But this government attacks business. It has taken a short-sighted and narrow view. It has not engaged with the business community and it has not looked at how it will broaden the tax base. For three or four years now we have been saying to the government, “Broaden your tax base. Go
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