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Tuesday, 22 February 2011
Page: 977


Mr BRUCE SCOTT (8:10 PM) —I rise this evening to voice my opposition to the Tax Laws Amendment (Temporary Flood Reconstruction Levy) Bill 2011 and the Income Tax Rates Amendment (Temporary Flood Reconstruction Levy) Bill 2011 proposed by this government.

Before I go to the substance of the bills, I wanted to say a couple of things about the devastating earthquake in Christchurch. I watched the evening news, and it was absolutely horrifying to see what is happening there. There are already 65 deaths and perhaps up to a couple of hundred people still missing and unaccounted for. It is devastating to know that our Anzac cousins across the Tasman have suffered yet another disastrous earthquake in that beautiful city of Christchurch. I want to extend my sympathies to the families, relatives and friends of those who have lost their lives. We can only hope that the teams there are able to move quickly to identify others who can be saved.

I also mention Christchurch because Queensland are sending our urban search and rescue team over to New Zealand with some paramedics. It is important that we do that. The Prime Minister made some comments after question time, supported by the Leader of the Opposition, and I would like to associate myself with the comments made by both of them. It is important that as a nation we make sure we support our Anzac cousins. I know that in my own electorate we have many New Zealanders who work in the area, particularly in the oil and gas industry. Only a couple of weekends ago, when I was catching the flight from home to return to Canberra for the sittings, two-thirds of the plane, a 50-seater DASH8, would have been New Zealanders. I asked them where they were going and they said, ‘We’re going back to New Zealand.’ They were operating two and three weeks on, and one and two weeks back home. I only hope that, if some of those people live in Christchurch—I did not ask whether they did—they are safe. I know that we are all thinking of our cousins and friends across the Tasman at this dreadful time.

The nation’s farming families and rural communities—and I say ‘rural communities’ because it is not just the farmers but also the communities that depend so much on the income that farmers derive—have just fought through a 10-year drought. More recently, some of the worst flooding in decades has hit south-west Queensland. The last thing that our food producers and our rural communities need is another tax, in the form of this proposed flood levy. Australian farms and their closely related sectors in Australia generate something like $155 billion of food each year, which underpins something like 12 per cent of the nation’s gross domestic product. In Queensland alone—and I go to Queensland because well over two-thirds of the land mass of Queensland was affected by the floods—they contribute something like $3.4 billion in cattle production, in beef; $1.015 billion in grain; $968 million in sugar, for cane and for crushing; $952 million in vegetables; and $86.9 million in wool and lamb production. That is a total of $6.422 billion of food production, without going into the wine, stone fruit and other products that the farm sector produces in Queensland—a staggering $6.422 billion a year contributed to the Queensland economy.

Farmers are struggling to keep their staff employed as they pull up fences, repair dams and repair the infrastructure on their properties. We are short of skills out in my part of the world—that is why the New Zealanders who I met on a plane a couple of weeks ago are over working in the oil and gas industry—and the farmers are struggling to keep their staff on their farms as they rebuild and get back on their feet. The last thing they need is to be slugged with another tax. I will give you an example in the dairy industry. There were dairy farmers out there during these devastating floods walking cows through water which was quite often up to their udders to get them into a safe place and the milking areas. If they were not able to get them in there and milk them twice a day, the cows would lose their lactation and it would be 12 months before they could produce again. The milk that the cows could produce was then thrown away because the farmers could not get it out of the dairy farms as the roads were closed; they were flooded. They were not paid for that loss by some of the insurance companies, as they are saying it was not insured. That gives you an example of the hardship and struggle they have been through to try and save their animals and keep their production going amongst the worst of nature that has been thrown at them. Yet, they too will be paying this levy.

It seems that the only way Labor knows how to solve a problem is to introduce a new tax or, as the government is calling it, a levy. Well, if it looks like a duck, quacks like a duck—in this case, it is a tax. This Labor government follows on from the previous Labor government, led by the now Minister for Foreign Affairs in that everything should be fixed with a new tax. I remember, just three years ago, there was the problem with alcohol abuse where young people were binge drinking. So what did they do? They brought in a new tax, the alcopops tax. That was to fix binge drinking. Then, people were smoking too much, so there was an increase in tobacco taxes. Car sales were down, so what was the response from the Labor government? It was to increase the luxury tax on motor vehicles. Some of those vehicles that have been impacted on are vehicles that are used by veterinarians and doctors in my electorate, not because they are a luxury item; it is just that they come above a threshold where the tax cuts in. These are four-wheel drives, Toyotas in most cases. They are an essential item when you are on some of the Western Queensland roads that I drive on regularly, and these are people like veterinarians, doctors and nurses who have them out of necessity, not for luxury. But who pays the increased tax on those? It is those people as well as those who may have been buying them in a city in a perhaps a genuine case of what we might class as having a luxury car. It is just another example of Labor, when there is a problem with their budget and their mismanagement of their economy, looking around to see where they can introduce a new tax. It is about time that this government took some tough decisions, rather than just always taking the easy way out and buying votes from the Independents and the crossbenchers here. There is no doubt in the world that they are going to be bought off, one way or another, to get this levy through. We have already seen some of the announcements and I do not want to repeat them here tonight, but I have been around here long enough to know that when someone is being offered something, it is an inducement to vote for the government—in this case, for this new tax.

As to the question of the exemptions that Labor has imposed on the levy, the levy has the potential to hurt the very same people it is supposed to help. Labor has stipulated that people earning under $50,000 or those who have claimed the Australian government disaster relief recovery payment—and I was very supportive of that recovery payment; I worked with the Prime Minister’s office on that to ensure that it was targeted and it would meet a very genuine need in my electorate—will be exempted. What about the people who have been affected by these floods who chose not to claim that payment? They will pay this tax. What about the farmers and small business owners who have lost income as a result of the floods but did not have destruction of some of their property, such as small businesses in the town of Dalby and one that I know of in Surat that was hit in March last year but received not $1 of assistance from the federal government? They employ 20 people in a town of 700. If they cannot keep those employees there and they have to wind that business back, you know what will happen to that town of fewer than 700 people. Those workers will leave town and it will be the start of the end of that town. Yet they will be paying this tax. The Prime Minister promised that she would ensure that the levy would not be paid by those affected by the floods, but it seems that people who have been affected by the floods in a secondary way will. There are certainly businesses out there—and I am sure that members on the other side of the House could recognise that—who have not had government assistance, but they too will be paying this tax.

Then there are those people who have already donated to the flood relief effort, either through volunteering or monetary contributions. We have had contributions from both sides of the House on the wonderful philanthropy that has come from people all around Australia. My concern, as it is for many on this side of the House, is that if this tax goes through, next time we have a natural disaster, why would they want to give as generously as they have as a result of this natural disaster across Australia? They will say: ‘Well, I’ll hang off because there’s going to be a levy; there’s going to be a new tax. I’ll pay it that way and give up my philanthropy and my volunteering that I have done in the past.’ When it comes to spending money wisely, whether it is the Labor government down here or the Labor government in Queensland, they just do not know how to manage an economy. They do not know how to manage money. Have a look at the Bligh Labor government in Queensland. They have been through the biggest mining resource boom that we have had in this country, and all they have been able to do is rack up debt on debt on debt. In fact, the state of Queensland has lost its AAA credit rating. I am ashamed to say that I am a Queenslander. Even New South Wales still has a AAA credit rating. But the great state of Queensland, with the mining boom and the resources behind it and the royalties that have flowed from that, under the leadership of Premier Bligh has been put into such a debt situation that its credit rating has been downgraded to AA. I think it is the first time in history—certainly in the last 30 or 40 years—that Queensland has been put in that position.

That is what we find when we look at the record of Labor governments. There are always new taxes. They cannot manage the economy and they cannot manage programs. When the government tried to sell free insulation programs, including the pink batts program, in a hot summer in western Queensland when the temperatures soar above 46 degrees Celsius they could not even sell that program to the people out there and manage it properly. Labor governments cannot manage budgets. They cannot manage money. This is a case of going back to the people with another new tax and it is reckless spending. If they would only listen to this side of the House and the suggestions from the shadow Treasurer, the Leader of the Opposition and others on our front bench, there are savings that could be made. If in a budget with $350 billion of revenue you cannot find another 0.5 or 0.6 per cent of savings or deferral of expenditure in the next 12 months, really you should not be occupying the government benches.

There are families out there who believed they had insurance cover on their property. Many have lost their homes, but because it is considered flood insurance rather than stormwater cover they will not receive an insurance payout. I have many of them in my home town of Roma where they are running a class action against the insurance companies. Those people will be paying the flood levy. They have had to rebuild their homes out of their own resources. Some charities have been very supportive of them and local businesses have helped a lot of our older people and senior citizens and have helped to re-establish the town, but they will be paying this tax as well. They have not received insurance payouts—and I condemn those insurance companies for the way they have treated people under these circumstances—and they will also be paying this new tax.

There is a better way. The government should listen to the suggestions from this side of the House on deferring expenditure and postponing non-priority expenditure. I am opposed to this new tax. It is yet another example of a government that cannot manage money. Whenever it runs into a budget problem it goes back to the people and introduces a new tax. I am opposed to this levy.