Page 2649 - Week 08 - Thursday, 14 August 2014
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The ACT Government seems singularly unaware of why the ICT contractor market exists so strongly in the ACT: what its value is, how that value is created, how critically it ties to the core functions of federal government, and how a payroll tax that brings ICT contracting ‘into alignment’ with (say) blue-collar workers in labour hire industries in other jurisdictions defeats much of the value of having a strong ICT contractor market in the ACT in the first place.
Again, members, that is what you are voting for this evening. Another one:
Let’s hope Recommendation 56—
from the bipartisan estimates committee report—
is adopted, otherwise anyone signing any sort of contracts in the ACT will be scared that the Government will suddenly change the rules ‘post signed agreement’. Is Labor going to go back and change the Stamp Duty on my last house purchase and get me to pay another 10k? Well, if they have done it once, who knows?????
This is what we are doing with the nature of this. This is the last one I will read:
Some further proof of the harsh nature of Barr’s tax. One of the contractors at the conference, working for the ACT government, has been forced to take a 7.2% pay cut along with all other ACT contractors as far as we know. Now he has to take a pay cut of another 10% approx. of take home pay. There is very little other work at the moment so he is stuck.
I have a folder full of email and I have rung most of them and tried to talk to them. We have been in correspondence by email with most of them. They are willing to accept the government wants to change the rules and have some alignment. They accept the logic of it; they do not necessarily agree with it and they do not necessarily like it. But all they are asking is that the financial plans that they have set for the 2014-15 financial year—in which case most of them have already signed—be honoured. I do not think that is a big ask.
If you talk to any business around the country, probably around the world, the thing they want most is certainty. All these people, based on an understanding of the law at the time, in good faith, with the ACT government, the federal government or others, have signed contracts and made obligations. We all know people often work out their budgets on the basis of what they have got. This tax was genuinely aimed and should only be aimed at employers, but this payroll tax is being passed on by the nature of it to people who work in the industry as independent contractors. Because they have no redress—we all know times are tough and you stick with the deal you have got—these people are being forced to take significant pay cuts.
The one clear case is Mr Taylor who has been to the Canberra Times and said $450 a month. That is a lot of money to come out of somebody’s household budget. The problem is that they cannot in most cases break their contracts. Most contracts, as we know, have penalty clauses, and if you do not deliver the goods, if you are a small company with just four or five in a group and you lose staff and cannot accommodate
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