Page 1236 - Week 04 - Wednesday, 9 April 2008
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extent than it is has ever been before, but we also did drive a whole range of efficiencies. There is embedded within the budget $100 million worth of efficiencies. So this suggestion that we are just trying to tax our way to get our service delivery costs to match our revenue is simply not true on a number of bases: we tax at the average, we are driving efficiencies and there is always room for improvement; there is always an opportunity and potential to do more. But we have done the hard work on efficiencies. We have done the hard work in seeking to ensure that our revenue effort matches our expenditure effort.
It is not fair to say that this is an inappropriate or unfair tax. You could say that about every tax. Nobody likes taxes or taxation. This particular tax was introduced two years ago as one of a number of revenue measures necessary to address what everybody knows and accepts and acknowledges was a historical mismatch between the territory’s expenditure and revenues, which has been evident since self-government and, indeed, before. There is absolutely no sound policy reason why you would abolish this tax. More generally, in fact, there is no sound policy reason for reducing the amount of overall taxation.
The utilities networks tax provides a significant level of revenue—just under $17 million. As I have said, abolishing this tax would reduce the budget and forward estimates by $70 million. That is what is being debated here. What is being debated is a proposal that $70 million be taken out of the budget and out of the forward estimates. As I have said, absolutely no proposal accompanies the bill or has been put by anybody supporting the bill that would restore the revenue position or the budget position.
The utilities network tax is one of the few ACT taxes that generate revenue from a source other than property or employment. It is a significant tax which helps to diversify the territory’s taxation base. It is considered reliable because it is derived from a relatively stable base that is not subject to significant market trends, which, of course, makes it even more attractive for a government. It is applied consistently across all utility sectors with liability resting on the individual network owners.
The tax is well bedded into the billing processes of utilities; the calculation methodology has been set to minimise the administrative effort of utilities. It has a comparatively low administrative burden on the Revenue Office in relation to its collection. It is an efficient tax, and although the charges are being passed through to the consumers, the full extent and timing of this effect will be determined by the pricing strategies of the particular utilities.
To conclude and in summary, this is a broad-based and relatively efficient tax that has been well bedded with relatively low administrative burden for both the government and the taxpayer. The government opposes the bill today. I lay down the challenge for anybody, particularly for the mover, but for anybody supporting it, to tell us and the people of Canberra which services you are going to cut. Where are they? Are they in health? Are they in community safety? Are they in child protection? Are they in climate change? Are they in education? Which services are you going to cut?
MR BARR (Molonglo—Minister for Education and Training, Minister for Planning, Minister for Tourism, Sport and Recreation, Minister for Industrial Relations) (5.10):
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