Page 3393 - Week 11 - Wednesday, 14 November 2007
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Your fundamental premise is quite wrong. And there is another premise that I think you fail to appreciate: in Canberra about 60 per cent of people who are employed are employed by business—and a lot of that small business. And there is another fundamental premise too: sometimes, if you do not overtax, and sometimes, if you might vary a tax, reduce a tax or even cut a tax, you are going to generate a hell of a lot more business activity. Ultimately that brings in a lot more money to government.
That is something that I have seen work in this place during times which were a lot worse than they are now—when our governments had deficits, when the federal public service had been cut by Hawke and Keating and, in 1996, by John Howard. We had to address that fact. Some very effective, very cheap, targeted programs were undertaken in relation to businesses, which greatly assisted this territory in a very difficult time financially. There are a number of things you can do rather than asking the absolutely simplistic question: what services are you going to cut to make up for abolishing a tax?
Mr Stanhope: Well, tell us. Just tell us.
MR STEFANIAK: You miss the point entirely. We would do things differently. We would do probably things so significantly differently as to make an absolute nonsense of that particular question. That is something that you seem to fail to appreciate.
Let us look at the utilities tax. Mr Mulcahy has introduced his bill. There are a number of facets to this which I think are relevant to this debate. It is simple. There is a utilities network facilities tax, simply known as the utilities tax. As the Chief Minister indicated, it was introduced in the 2006-07 budget. It has been in effect since January this year. It is imposed on any network facility on land in the ACT; this includes utility networks for transmitting and distributing electricity, gas, sewerage, water and telecommunications—all those things a modern city needs. Let me give some examples of the network facilities affected by the tax. They include our powerlines, all pipes over and under land, and telecommunications cabling.
The amount of the tax is calculated by multiplying the linear route of the actual network by the rate of the utilities tax. According to the June quarter report—the most recent figures, I understand—the government derived $8.665 million in revenue from the tax in 2006-07. That is revenue for half a year. According to the budget this year—again, figures which I understand are relevant for today, 14 November—the tax is expected to generate $16.525 million. It is expected to generate $17.13 million in 2008-09, $17.77 million in 2009-10, and a similar figure in 2010-11.
What does the tax cost our households? In answer to a question on notice on 31 May 2006, the Treasurer conceded that the introduction of the utilities network facilities tax would increase the cost of a range of services to ACT households. These include increases to the cost of water, sewerage, gas, electricity and, of course, telecommunications services. According to the Treasurer’s own figures, this increase in costs will have amounted to an additional $131 in utility bills for the average ACT household over the period from the introduction of the tax to the end of the 2007-08 financial year. That is composed of average increases of $23 in water bills, $18 in
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