Page 1633 - Week 05 - Thursday, 8 May 2008
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platform of fiscal conservatism and cuts to government. Compared to its federal and state government colleagues, the ACT government stands alone in its pursuit of bigger and bigger government at a time when the federal Labor government is conceding that some government restraint and fiscal responsibility are needed to improve the lives of Australians.
At a time when the federal government is touting a budget of frugality and restraint, with substantial tax reform to be delivered to all Australians, the ACT government has instead delivered yet another budget that focuses on high taxation and high spending. The result is that the people of the ACT will bear the increasing burden of the government.
Turning to rates and charges, general rates for ACT residents will increase by 4.4 per cent in 2008-09 in line with the government’s policy of indexation by the wage price index. This policy ensures that people on fixed incomes, or even on incomes which increase at a rate lower than the average overall growth of wages, will face a very real increase in taxation over time. This will be particularly hard on pensioners and other ACT residents who are reliant on income streams that increase according to the consumer price index rather than the wage price index, and it makes hollow the oft-stated claims in this place about concern for the so-called working families.
This policy of indexation by WPI will result in an average increase of $49 for residential properties, $21 for rural properties and $234 for commercial properties, not to mention all the other less abysmal charges that will also experience increases of this level. This is a policy of tax increases by stealth. By locking in a high rate of tax growth according to the WPI, the Stanhope government is able to act innocent while it is raising property rates in real terms for ACT residents.
Despite ongoing calls for tax relief, the government has left its controversial utilities tax and fire and emergency services levy completely untouched. The former is a tax that is unique to the ACT, while the latter has been widely criticised as a particularly pernicious tax that imposes a disproportionate and inequitable burden on commercial property owners. Even former Treasurer Ted Quinlan, the standard bearer of economic rationalism in the first few years of this government—I know it is a role that Mr Barr seeks to take over, having taken his seat—has highlighted the fire and emergency services levy as a tax that could be repealed, and I am sure he shared the disappointment of many when it was not listed in the budget initiatives.
Clearly, people have underestimated the commitment of the Chief Minister and his government to their ideology of big government. Despite golden opportunities to reform the taxation system in the ACT, the government has continually squandered its resources and instead committed itself to higher expenditure, including a great deal of expenditure on wasteful projects. In fact, one of the few tax relief initiatives provided in this budget has been a change to the threshold for payroll tax.
At the same time as the government has introduced new fees for lease extensions, for temporary licences to use land adjacent to developments and for amending a development application, the government continually tries to present proposals for tax cuts as being inconsistent with the provision of core services. The stock standard
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