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Tuesday, 9 March 2004
Page: 21059


Senator LUNDY (1:07 PM) —The purpose of the Great Barrier Reef Marine Park Amendment Bill 2004 is to amend the Great Barrier Reef Marine Park Act 1975 to clarify that GST is not payable on the environmental management charge levied on standard tourism operations.Such a simple concept and such a simple amendment—it really makes one wonder why it has taken the government not days, not weeks, not even months but years to make this simple and just clarification.

Since 1993 every visitor who has travelled to the Great Barrier Reef has paid a visitation charge, technically known as the environmental management charge or, as it is more affectionately known, the reef tax. The funds generated from this tax are remitted to the Great Barrier Reef Marine Park Authority and are used for the management of the Great Barrier Reef. No-one begrudges expenditure on the preservation of this environmental icon; in fact, Labor believes that much more should be done by the government to protect the reef. There is and always has been, however, a great deal of concern that funds raised from this tax are being used instead of, rather than in addition to, appropriations that the federal government should be providing. Further discussion on the issue of government appropriations to ensure the preservation of the reef will, however, have to wait until there is a federal government in power which takes environmental issues seriously and is willing to act to redress this issue.

Today's bill deals specifically with the collection of the reef tax. To say that this tax has been controversial since it was introduced in 1993 does not go any way to highlighting the imbroglio that has surrounded its introduction. When the tax was being considered for introduction there was extensive discussion around how it would be collected. This task eventually fell to reluctant tourism operators who held strong reservations regarding their new role. As discussions progressed, however, it became clear that the alternative was to leave collection of the tax in the hands of the Howard government. All concerned realised that this option would prove to be a very expensive administrative fiasco. To save a mismanagement nightmare, marine park tourism operators agreed to collect the reef tax on the government's behalf. Collection ran quite smoothly up until 1998, when the coalition introduced the concept of the GST in their federal election campaign. In the GST's infant stages there was much discussion—and even greater confusion—over the question of whether a tax being charged by the government could or should attract GST. The reef tax was used as a prime example of this very issue.

In essence, the question was whether it was legal, justifiable and moral for the government to tax a tax. According to coalition candidates at the time who gave absolute assurances in the lead-up to the election that GST would not apply to the environmental management charge, it was not legal, it was not justifiable and it certainly was not moral to tax a tax. They gave their rock solid guarantees that there would most certainly not be a GST charge placed on the reef tax. Knowing, however, that there was an inherent risk in relying solely on the promises of coalition candidates during an election campaign, marine park tourism operators sought clarification from the Assistant Treasurer's office. The taxation adviser from the Assistant Treasurer's office assured operators:

... the Government intends to include the Environment Management Charge in the list of taxes and charges that do not constitute consideration for the purposes of the GST.

Based on the election promises and the so-called ironclad guarantee provided to them from the Assistant Treasurer's office, the Association of Marine Park Tourism Operators wrote to their members, telling them not to collect the GST on the reef tax because it did not apply to it.

Marine park tourism operators were soon to find, to their own detriment, that the Howard government's so-called ironclad guarantees and promises turned out to be just another bunch of tinfoil non-core promises. In the second half of 2002, the Australian Taxation Office started auditing operators, who unexpectedly received retrospective bills ranging from $15,000 to $60,000. Apparently, despite initial government assurances that the GST did not apply to the reef tax, the ATO had decided that the GST now would apply to the reef tax. The ATO ruled that, although the reef tax was not subject to the GST when charged by the Great Barrier Reef Marine Park Authority to the operator, it was payable when the amount charged by the operator to its customer included the on-charged tax as part of the `ticket' price.

As a result of this obfuscating decision, operators were now being judged liable to pay back the GST funds they had failed to collect based on advice from the government. You can imagine how they felt. Labor immediately called for urgent legislation to clear up the absolute chaos and confusion that surrounded this mess created directly by the Howard government giving misleading advice and reneging on a campaign promise. That was in 2002. It is now March 2004 and the government is only now, as a result of considerable and constant pressure being applied by Labor senator Jan McLucas and member of parliament Joel Fitzgibbon—


Senator Crossin —And a splendid job they both do, too.


Senator LUNDY —Thank you, Senator Crossin—taking belated steps to honour its pre-election commitment not to charge the GST on the reef tax. While Labor supports this bill, it must be noted that Labor condemns the government for its deplorable mishandling of the application of GST to the environment management charge, for its total disregard for and ignorance of the concerns of marine park tourism operators and for failing to act expeditiously to rectify this matter. The government has known for years that this has been a problem.

The fiasco evidenced by the collection of the reef tax is not, however, out of accord with the coalition government's general disregard for environmental issues. The Howard government's failure to take the issue of climate change and greenhouse gas emissions seriously, failure to act as a good environmental citizen and ratify the Kyoto protocol, failure to protect our coral reefs from mass bleaching due to increased water temperatures as a result of global warming, failure to increase renewable energy targets and failure to look after the health of the Murray River are just a few issues on an extensive list of government environmental cop-outs.

The Great Barrier Reef Marine Park Amendment Bill 2004 belatedly clarifies the issue of GST and the reef tax. The Howard government, however, must not be allowed to claim moral justice for an injustice that arose purely through their own negligence and mismanagement. Without continued pressure by the Labor Party to force the issue, the Howard government would have left this issue to float aimlessly within the miasma that is their environmental policy. This is a minor step along the path that the Howard government must venture if they are to even begin to be seen as addressing problems of their own making. They have a long way to go.