Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Wednesday, 13 March 2013
Page: 2071

Mr HAASE (Durack) (17:20): I rise to speak to this report and, in doing so, I would firstly like to acknowledge the secretariat for the magnificent job they did in guiding us through this report. The aspect of the report that I wish to specifically address is the issue of taxation zone rebates. Deputy Speaker Scott, you and I have shared discussions on this topic on numerous occasions. The taxation zone rebates boundaries were drawn in 1945 and have remained basically the same since that year. Over time—approximately every 20 years—there has been some rejigging of the rates, some rejigging of the boundaries in a new shape, but basically it remains the same. This rebate—in fact, it was not a rebate initially—was worth to a taxpayer who works for a year in a remote area, perhaps with a wife and small preschool age children, an amount of money equivalent to about six weeks extra wages per annum. It was a substantial amount of compensation paid each year to those persons who were prepared to do it tough and live in the bush. It was about the toughness of living in the bush. It was about the high cost of living dictated by distance, lack of choice, lack of competition and the general hardships of doing it tough.

In the case of the town that I know the example best applies to, Kalgoorlie in the Goldfields, if you spend 12 months working in the Goldfields these days, and you are a taxpayer, you are entitled to a rebate on your tax of the princely sum of $57 per annum. As many an accountant has said to me, it would almost cost more than the $57 in their time to claim it for you, because it is such a paltry sum.

The lack of equity in the payments from one area to another is incredibly striking. For instance, working in Broome or Port Hedland the amount that one is entitled to is the same amount that you would get if you were working in Marble Bar. Both Port Hedland and Broome, of course, are on the ocean. Marble Bar is not on the ocean. For anyone living in Marble Bar—bless their cotton socks; I love them all—Marble Bar is no Broome and it is no Port Hedland.

The reality is that it is high time something was done to create some equity in this taxation zone rebate system. That can only be done with a thorough analysis of the way that it impacts on those who are truly bone fide residents of remote areas and also of how it impacts on those who are not bona fide residents but are entitled to the taxation zone rebate simply because they spend 183 days in a year working in that particular area. The contrast between the conditions of working in those remote areas today and working in those remote areas in 1945 could not be more extreme. Workers that are entitled to this because they work in the area might live in the leafy suburbs of Perth or on the coast as a southern community, and many of them do. Rockingham and Mandurah are wonderful bastions of those that work in my electorate but do not live there. They rarely spend any money there. They enjoy their time living in, as I say, the leafier suburbs. They are entitled to the same amount of payment as if they were working and living in Marble Bar. The conditions that are enjoyed by the average FIFO or DIDO worker today are luxurious compared with 1945, but they are luxurious compared with almost any of the employment situations around the suburbs of our capital cities. They have air-conditioned transportation, they have serviced accommodation, they are presented with multiple choices of meals three times a day, their laundry is attended to in the camp—towels et cetera—and lot of people have to spend a lot of time in the gym, believe me, because the paddock is generally a good one and one of the major problems of being a FIFO worker these days is that weight is easily gained.

So something has to be done. It is time that this whole issue of the taxation zone rebate be addressed to create some equity, because it was designed initially to attract workers to the difficult areas, areas that were hard to populate, and it worked. After a few years of getting six weeks extra wages a year, couples could go back to the big smoke and pay for a house or at least put a very substantial deposit on a house. It gave them a leg up in life. When they did not have the amenities, and when their children became school age, they often left that remote area and moved to the amenities of the city and had those facilities that were required, whereas today all of these areas have pretty good facilities and the payments are abysmal. Therefore there is no hook, there is no lure and there is no financial incentive for people to go to and live and work in these remote areas.

I am the first to appreciate the politics of any policy and I know that, if we were to do the logical thing and change the system so that those who were not bona fide residents in the area were not entitled to it, there would be some hue and cry. But if the policy of paying it is to attract residents to country areas, remote areas and difficult-to-populate areas then I feel that we have to bite the bullet. There is also the case where a population was very low in particular areas when the system was brought in in 1945, and those same areas are now in excess of 100,000 population. It is hardly justification for a bonus to attract people to live there. Darwin immediately comes to mind. I face the reality that many people, especially my colleagues, will ask how dare I take away the taxation zone rebate for the residents of Darwin. It is a substantial amount of money. Not only is there an additional 50 per cent on family tax benefits paid but there is also about $1,130. To take that away is significant. But if we are to suggest that this money is paid as an incentive to populate hard to populate areas, why should we pay it to those who are living in a populous area where there is competition, amenity and public transport—all of those things that this money was paid to compensate for.

Mr Neville: You have it at two levels.

Mr HAASE: Indeed, we have in fact four levels of payment for the taxation zone rebate. We have zone A in the northern portion of Australia, zone B in the southern portion and then we have special zone A and special zone B. A special zone is determined by whether or not a location is more than 250 kilometres from a population centre with a minimum population of 2,500. It is very specific. But even though it is very specific and the Taxation Act clearly outlines what the rules and regulations are and what towns are in and what towns are out, the figures that the taxation department work on are inaccurate and totally out of date and abysmal. Kununurra is listed as being entitled and yet Kununurra has a population well in excess of 2,500. The figures and the facts that the taxation department works on are wrong. Their assumption that this is in some way equitable is wrong, because there are towns in western New South Wales that have far less amenity than places like Darwin and yet they are not in any of the zones in relation to the taxation zone rebate.

The examples are numerous. It is referred to in our report. It is one of the recommendations that I have been concerned with for all of my time in this place. It is well and truly past time now to look at this. When you look at the average period of time that has elapsed for attention to and revision of this taxation zone rebate system, that has well and truly gone. Time was up about 10 years ago. It is time that something was done. It is time that some equity was introduced. Every aspect of this needs to be attended to, including the amount of compensation. Frankly, I believe that it would be embarrassing for members of the taxation department to try and defend why such an outstanding opportunity to get money compensating you from the government amounted to $57 per annum. Anyone who could keep a straight face arguing that I would suggest would have to be brain dead. It is time that something was done.

With those few words on that very specific subject, I seek leave to table a document in relation to the boundaries of the taxation zone rebate at present.

Leave granted.

Mr HAASE: Thank you.