Page 3456 - Week 08 - Thursday, 23 August 2012
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The concern that I have is that, based on the Treasurer’s own numbers in the budget, the ACT economy was forecast to go backwards in the June quarter of 2011-12. In trend terms, the reduction would be something in the order of $135 million. If the Treasurer chooses to use the seasonally adjusted data, the reduction would be in the order of $321 million. Of course, if these forecasts are not realised, that means that the forecasting capability of the ACT Treasury will be called into question yet again.
Budgets are important. Budgets lay the foundation for economic investment. Budgets tell us what we are being charged as ratepayers. This budget fails on all of those counts. In this case, this line should not be supported by the Assembly.
MR BARR (Molonglo—Deputy Chief Minister, Treasurer, Minister for Economic Development and Minister for Tourism, Sport and Recreation) (8.19): The Treasury Directorate provides a vital role in administering the territory’s finances and taxation. It also provides advice and guidance to ensure appropriate economic and financial management in the territory. This includes support for our fiscal policy and responsible return to surplus, our modest and responsible savings program and our reforms to the taxation system. The collection and administration of taxation ensures that the ACT government has the funds to provide the services, facilities and infrastructure the ACT community deserves and expects, and to deliver and plan for future growth.
However, it has been widely acknowledged for some time that the territory’s taxes, like those of other states and territories, are in need of reform, and in this budget the government have acted. We have outlined a five-year reform plan to make taxes fairer, simpler and more efficient. This particularly includes reducing taxes for those who have lower incomes, making the tax system simpler to understand and administer and, importantly, reducing distortions on household spending and business activity, removing about $175 million worth of deadweight loss from the territory economy.
Our reforms make the ACT less reliant on volatile taxes, putting the collection of tax revenue on a more stable basis for the future. The benefits of these reforms are economy wide and the government have continued to provide appropriate and targeted assistance and financial support to those who need it. Our reforms support economic growth and allow the government to maintain and enhance the high standard of living that our community enjoys.
The commonwealth’s contraction in employment and spending and continuing global economic uncertainty will pose challenges for the territory economy in the fiscal year ahead. In light of this the ACT government’s budget has maintained spending on front-line services and infrastructure to support the economy and to continue to support local jobs. We have continued in this budget our measured and responsible plan to return the territory to surplus in 2015-16.
Question put:
That the proposed expenditure be agreed to.
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