Page 1837 - Week 06 - Thursday, 9 May 2013

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MADAM SPEAKER: Mr Barr, could you address your remarks to the chair?

MR BARR: Madam Speaker, that is exactly the position of the Canberra Liberals. They believe that rates should not be progressive and they should not be efficient. General rates were identified as an efficient tax by the ACT taxation review, by the Henry tax review, and they certainly provide a very sound economic base to replace inefficient taxes such as stamp duty and duty on insurance premiums.

This bill removes all reference to the tax-free threshold in the calculation of general rates and the fire and emergency services levy in the Rates Act 2004. The abolition of this tax-free threshold, along with the use of tax brackets and progressive rates, makes our general rates base more stable, more efficient and a fairer source of government revenue.

The rates deferral scheme allows eligible households to defer payments of their general rates. A low rate of simple interest is charged on any amounts deferred. Before the government’s taxation reforms, this scheme was only available to eligible pensioners and property owners suffering substantial hardship and special disability trusts. This amendment will expand this scheme for the first time to allow non-pensioners, including self-funded retirees, to defer general rates, provided they meet a range of criteria—that is, at least one of the lessees must be 65 years or older; the lessees’ combined income must be below the annual average earnings, a figure that is updated annually; the property’s unimproved land value must be higher than the 80th percentile value, again, updated annually; and the lessees must have at least 75 per cent equity in their home. Details of the eligibility criteria will be administered through a disallowable instrument.

These important reform measures which have previously been implemented administratively are already benefiting our economy and our community, and ensuring a greater level of social equity within the city of Canberra. The passage of this bill will formalise, in a legal sense, these reform measures and further the government’s reform agenda.

I commend the Revenue Legislation (Tax Reform) Amendment Bill 2013 to the Assembly.

Question put:

That this bill be agreed to in principle.

The Assembly voted—

Question so resolved in the affirmative.

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