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Education a winner from fairer GST.

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Senator Lyn Allison

Australian Democrats

Spokesperson on Schools


June 1,1999 99/300


Education a winner from fairer GST


The schools sector and families will be much better off under the amended GST, with the costs for running schools fal ling (through embedded sales tax coming off), revenues to the States rising and families enjoying tax cuts and enhanced compensation, according to the Australian Democrats.


Democrats Schools spokesperson Senator Lyn Allison said the declining tax base over two decades is one of the reasons why we have a shortfall of around $2 billion in Australia’s school education budget.


“Government schools have had to cope with under-resourcing by charging higher and higher fees and greater reliance on fund raising,” she said.


“There is nothing fair about flat taxes on all students — so-called voluntary school fees — and the very different capacity schools have to raise money for essential education services.


“The Democrats would not sign up to a package that is anti-education, and education unions have simply not bothered to consider the full facts including:


·  Education services are GST-free, including adult education courses. The scope of the GST exemption is very broad and includes music lessons, school camps, excursions, sporting activities;

·  Schools can claim input tax credits on all goods and services including education software, arts materials, stationery, IT equipment, etc., far broader than the current sales tax system, actually reducing the costs to schools by 0.7%.

·  Tuckshops will not be subject to the full GST and there is agreement that amendments will be developed which will minimise compliance costs;

·  A $15 million National Child Nutrition Project to combat diet-related disease;

·  Other fundraising in schools will be GST-free where it is clearly not a commercial activity, including sales of donated goods or 50% below market value, bingo and raffles;

·  HECS is to be GST-free

·  Voluntary organisations such as P&C’s will be treated as charities and we will hold the Prime Minister to his promise that charities will not be disadvantaged

·  Books acquired by schools and libraries will be GST-free, and a bounty ($240m over four years) will be paid to reduce the price of Australian books (85% of educational books);

·  Union fees will attract a GST (although this will be tax deductible) but the average teacher receives a tax cut of$1422 a year;

·  The family allowance for young people up to 21 not receiving Youth Allowance will be made payable at a rate of $50 per fortnight and extended to 25 year olds, while Youth Allowance will be increased by 4% permanently (a 2-3% real terms increase).


Senator Allison said families were more than compensated for any additional costs of a GST, with a single income family on $40, 000 with two children about $34 a week better off.


“But, the real gain of the New Tax System is that it gives the States a more reliable and growing revenue base to fund future education. That is why the Democrats went into tax reform in the first place,” Senator Allison said.




Lyn Allison 015 691 512



lk  1999-06-03  10:37