Page 1644 - Week 06 - Tuesday, 12 May 2015
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has commissioned tax reviews. But the ACT is one place in this country where we are actually implementing tax reform. We are abolishing the worst taxes that we levy and moving our tax base to the most efficient base that is available to us as a jurisdiction.
Given the constitutional powers and taxation roles and responsibilities that we have, it makes sense that we raise the revenue we need to raise in the most efficient way possible that is the least distortive on economic decision making. It is a crazy proposition, if you were to start designing a tax system from scratch, that you would utilise the most inefficient forms of revenue raising, which has been the historical precedent in Australian states and territories.
We have targeted the most inefficient taxes that are levied by state and territory governments and we are abolishing them. There is not an alternative position put, other than, one presumes, increasing these inefficient taxes. I imagine that even the shadow treasurer, who has opposed all of these reforms along the way, would not, if he were to assume office, seek to increase these inefficient taxes again. But you never know, and we look forward to a statement one way or the other from the opposition on whether in fact they support increasing tax on insurance and putting stamp duty back up again.
As part of our abolition of all tax on insurance in the ACT, to become the first jurisdiction in Australia to completely abolish all tax on insurance, we have been phasing out that tax over a five-year period. By 1 July 2016 we will become the first jurisdiction in Australia to completely abolish taxation on insurance. That means, for every business in Canberra that has business insurance, they will not be paying a 10 per cent tax on top of that and then 10 per cent GST on top of their premium and the territory tax.
We have abolished commercial land tax. I am sure Mr Doszpot will be delighted to hear that we have entirely abolished commercial land tax. That reform, the abolition of commercial land tax and the abolition of tax on insurance—
Mr Doszpot interjecting—
MR ASSISTANT SPEAKER (Dr Bourke): Sit down, Mr Barr. Stop the clock.
Mr Doszpot interjecting—
MR ASSISTANT SPEAKER: Mr Doszpot!
Mr Doszpot interjecting—
MR ASSISTANT SPEAKER: Mr Doszpot, you are warned.
MR BARR: Through the abolition of these taxes we are certainly working to improve the efficiency of our tax system and ensuring that we are not utilising revenue lines that create distortions in business decision-making. Why would you put a tax on insurance? We want people to take out insurance. We want businesses to be insured, we want households to be insured and we want people to insure their motor vehicles,
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