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Thursday, 19 February 2004
Page: 25270


Mr DUTTON (12:18 PM) —I rise today to speak to the A New Tax System (Commonwealth-State Financial Arrangements) Amendment Bill 2003, which facilitates the operation of the goods and services tax arrangements legislation between the Commonwealth and each of the states and territories that was passed by this parliament in 1999. From the outset it is important to note that this bill is not controversial in nature, as all the measures outlined in it have been agreed to by every state and territory government.

By way of background, as honourable members would be aware, the general purposes payments of GST revenues are authorised by the new tax system act of 1999. The schedule to this act contains the Intergovernmental Agreement on the Reform of Commonwealth-State Financial Relations, which contains the terms under which payments of GST revenue can be made to the states and territories. The main terms are that the Commonwealth must pass all GST revenue net of administrative costs to the states, and the states may spend this revenue in any way they wish; the Commonwealth has guaranteed that no state will be worse off than if the reform had not been implemented in the transitional years; the interstate allocation of GST revenue is based on the relatives calculated by the Commonwealth Grants Commission based on the fiscal equalisation principle; and the state governments would abolish a number of taxes, reduce gambling taxes and administer the First Home Owners Scheme.

The main purpose of this bill is to ensure that the GST arrangements with the states and territories are carried out and administered in the manner that was originally intended by the 1999 act. There are three main measures in the bill before the House. The first is the clarification of the tourist refund scheme and like arrangements. The current act operates in such a way that it excludes GST refunds made by the Commonwealth under the tourist refund scheme. To date, the Commissioner of Taxation has not been able to deduct all GST refunds when determining the amount of GST revenues collected. In particular, under the scheme the commissioner has not been able to deduct GST refunds to domestic tourists, international organisations, diplomatic missions and visiting defence forces. This bill will ensure that the commissioner is able to account for all GST refunds when determining GST revenues for the 2003-04 financial year and for future allocation periods.

The second major aspect of this bill is that of residual adjustments. The act currently ensures that no state or territory will be worse off during the transition period as a result of the implementation of the new taxation system reforms. This guarantee is given effect through the fact that under the intergovernmental agreement the Commonwealth currently meets the difference between each of the states' and the territories' guaranteed minimum amounts and GST entitlements in the form of budget balancing assistance, or BBA. This bill introduces a mechanism to ensure that, even where the states and territories come off budget balancing assistance, any overestimate or underestimate of payments in a previous financial year can be fully accounted for. The final measure in this bill is that of the timing of determinations. The bill makes minor changes to the statutory deadlines under the act. These changes will improve the timing of the determinations required under the act which are used to calculate the final state and territory entitlements to payments under the act.

As I have highlighted, this is not a controversial bill. The bill is necessary to ensure that the intergovernmental agreement entered into with the Commonwealth by the state and territory governments continues to be administered in a manner consistent with the intentions at the time of reaching that agreement. This bill entrenches certain procedural elements to ensure that the system remains fair and equitable for the states and territories, and for this purpose I commend it to the House.

Given that members of this House are discussing elements of the intergovernmental agreement, it is relevant to discuss today the general operation and workings of GST allocation within the states. It is important as part of this debate to note that the Howard government is cutting taxes and providing substantial GST windfalls to the state governments at a time when state Labor governments are dreaming up new and increasingly imaginative ways to fleece families of their hard-earned dollars.

Queensland provides no better example, Mr Deputy Speaker Lindsay, as you would be well aware. In fact, it should be noted in this place today that the newly elected Beattie government will receive a GST windfall of $334 million in 2003-04 over and above what they would have received before the introduction of the GST. The Queensland government now receives over $6 billion per year in GST revenue. It is important to note that, because I want to discuss some of these tax slugs that Labor governments—the worst of them being the Queensland Beattie government—have been imposing.

I want to first turn to the area of stamp duty. Stamp duty was meant to be abolished over time from the commencement of the A New Tax System (Commonwealth-State Financial Arrangements) Act 1999. Of course, that has not been done. Some concessions were made by the Beattie Labor government in Queensland as part of their platform for the election held only a couple of weeks ago, but it took an election campaign and all of that period since 1999—almost five years—for some concession to be made and for the Beattie Labor government to move in the direction of abolishing some of the onerous stamp duty that is placed upon first home buyers in particular.

It is important to note as part of this debate today that the stamp duty on a median house in Brisbane when Mr Beattie was first elected was $3,780. Today that same house is hit with $9,500 in stamp duty.


Mrs De-Anne Kelly —Disgraceful.


Mr DUTTON —It is a disgrace and it is something that the people of Queensland, and indeed people right across Australia, need to call the Labor state governments to account for. Whilst this government has been responsible for taxation reform and providing GST to the states, including $6 billion a year to Queensland, the states have had a massive windfall from stamp duty revenues as a result of the property boom that has taken place over the past 18 months to two years. At the same time as these revenues have been increasing —by way of GST and the ever-increasing Labor state taxes—services have been declining. The people in my electorate quite rightly ask, `Where the hell is Peter Beattie spending the money?'

One of the ways in which Labor governments spend money, or squander money, is in the public service. Some of the figures that come out of Queensland are quite horrendous. It is an attempt by Labor governments to answer to their masters, the unions, by putting on staff whose duties nobody can understand because they are not involved in service delivery. Over its term, the Beattie government has increased its public service by something like 39,000 staff. Nobody can tell you where the staff work and I understand that only a third or less are involved in service delivery.

Whilst Peter Beattie and the other state governments are crying poor in relation to the revenues that they receive, I think Australians are now starting to understand that Labor governments—as we have seen at a federal level and in every state over previous decades—are incapable of managing the economy and incapable of providing jobs for young Australians. Previous Labor governments at a federal level have certainly been completely incompetent and unable to provide a low interest rate environment for home owners and small business. It is important as we discuss this debate today on Commonwealth-state taxation relations to highlight these points once again for the Australian people.

I am speaking about taxes that are imposed by state governments. Another tax that I want to highlight today is the ambulance levy. One of the most unjust and unfair taxes I have ever seen implemented was brought down by the Beattie government only 12 months ago. It is an $88 a year ambulance tax that families are automatically slugged with when they pay their electricity bills. It is hard for many Queenslanders to comprehend why we pay our ambulance dues on our electricity accounts. What happened to the system where the user pays? That is the system where if you require the services of an ambulance and you are a subscriber to the ambulance service then that service is provided to you free of charge. If you are not a subscriber, you are from out of town or whatever the case may be and you require the services of an ambulance then you pay for that service. To many small businesses that are paying this hideous tax, sometimes on dozens of occasions, it shows that Labor governments will go to any measure to slug taxpayers to try to pay for their economic incompetence.

Two other areas of great concern to all Australians are health and education. When we are discussing these very important issues, we should remind ourselves of the fact that GST revenue in Queensland is in excess of $6 billion per year. Under the agreement, the GST revenue can be used for any purpose, but in these two areas in particular we continually see cost shifting by the states.

I think it is also important as part of this debate today to correct some of the facts that the member for McMillan raised before in relation to the funding of education; it is important to dispel some of the rubbish that he was speaking before. In relation to taxation and the funding of state schools, state schools are fully owned, managed and operated by state governments. I want to quote some figures from my own state of Queensland. In its 2003 budget, the state government of Queensland increased its funding for education by 2.4 per cent. During the same period, the Australian government increased its funding to education in Queensland by 5.4 per cent. We hear Peter Beattie and other state leaders running around saying that the Commonwealth is depriving public education of much-needed funds but, when you get down to the hard facts, the federal government increased its funding to education in Queensland by 5.4 per cent compared to the Queensland government's increase of 2.4 per cent. It was worse in New South Wales, where the state government increased funding by 0.8 per cent compared to the federal government's increase in funding to education in New South Wales by 5.7 per cent. The argument being run by the education union at the moment is disgraceful and dishonest, and it deserves to be highlighted as part of the debate today. If the Queensland government had increased its funding by the same level as the Australian government, it would have meant an additional $116 million for our schools in Queensland.

There are many more debates to be had on education and health. We on this side of the House have a very good story to tell in relation to our commitment to each of those areas. I can give constituents in my electorate of Dickson the absolute assurance that over the coming months they will be finding out the true facts about the commitment this government has to providing proper funding—as we have done over our period of government—to important areas such as health and education. But when we do that it is important to highlight the deficiencies in the state governments' arguments and the deficiency and inadequacy of the funding they provide, because their priorities are completely wrong.

Other Queensland taxes that I want to discuss today include, the poker machine tax which the Labor government in Queensland has introduced to fund a new sports stadium. The Labor government in Queensland has doubled the cost of some drivers licences. The Labor government in Queensland introduced a tax earlier this year that slugs farmers for water use. Water costs for farming families have increased by between 100 and 300 per cent. The Labor government in Queensland is also making farming families suffer by doubling the fee for animal tick inspections. Is there anything left in Queensland that is not taxed?

The grab that the Beattie Labor government is making from Queensland taxpayers is breathtaking. It is slugging not just individuals but also small business. It is stifling business in Queensland. Commerce Queensland will be able to tell you about that, as they did during the Queensland election campaign. What about motor vehicle registration? You would not be surprised to hear that the Labor government has now introduced a $40 fee which families will have to pay if they are even one day late in paying their vehicle registration fee. Forty dollars! What else is there? Court fees in Queensland have increased by 150 per cent. Compulsory third party charges have increased. The business registration fee for people wanting to start a small business has increased. The Labor government in Queensland has just decided to increase the number of speeding and red light cameras in another desperate attempt to fleece money from taxpayers.

As we discuss the arrangements that are currently in operation—and this bill will ensure that they continue to operate between Commonwealth and state governments—it is important to highlight that it was this government that introduced the new tax system. This government introduced the new tax system because it recognised that we had a 100-year-old sales tax system that was inadequate for modern Australia and inadequate for providing for the future of all Australians, particularly in a society where we have an ageing population. It needs to be recognised again today that it was the fiscal responsibility of this government which ensured that, despite much grief, this legislation was brought down.

When the Australian people go to the polls later this year, they need to ask themselves this question: can Labor be trusted with the books? The facts and figures speak for themselves. When the Labor government was in power for 13 years up until 1996, it left us with a debt of close to $100 billion. This government has been responsible in repaying that debt so that it can create a climate of low interest rates so that not only can families prosper but also small business can thrive and big business can continue to employ Australians as it has done. As part of that, this government has been able to reduce inflation and unemployment. I think that one of the proudest facts on the record of this government is that we have been able to get 1.3 million Australians back into work over the last eight years. The Labor Party talks about the industrial relations proposals it would implement if it were in government, which big business, small business and anybody in business with any sense whatsoever has slammed as being regressive and a destroyer, not a creator, of jobs. That is another fact that the Australian people need to bear in mind.

The Labor Party are about turning back the clock on issues like industrial relations. They are talking more about putting people out of work than into work. It is one of the hallmarks of this government that we have been able to create, at least to a certain level—of course, we have been hampered in the Senate—a climate where business has been able to prosper and provide jobs to young Australians. If we have done nothing else in government, we have been able to provide a start in life for those people to be able to contribute to the economy and raise their families in decent circumstances instead of in the poverty traps that were created and encouraged by the Australian Labor Party.

In closing, I want to say that the Australian people face a very stark choice at the end of this year. They face the choice between a government that has proven itself over the last eight years to be able to manage the Australian economy successfully, and, on the other hand, a ragtag of individuals who have no purpose. If you had listened to the Leader of the Opposition's speech yesterday, you would know that there was no mention of policy whatsoever. There is no mention of costing. The Labor Party has no concept of money or how to spend it—well, they know how to spend it; they do not know how to spend it wisely. The contrast could be no starker.