PREMIER CONSPICUOUSLY AVOIDS DEBATE ON STATE TAX REFORM

The Tasmanian Greens today said that the Premier and Treasurer Lara Giddings has conspicuously avoided the issue of tax reform in her State of the State speech to the Committee of Economic Development of Australia conference.

Greens Economic Development and Treasury spokesperson, Tim Morris MP said that the looming threat to the budget bottom line of reduced GST payments again highlighted the need for the State to redouble its efforts to set a vision for a Tasmanian taxation system that can meet Tasmania’s long-term revenue challenges.

Mr Morris said that Ms Giddings appears to be running scared from the certainty of an irresponsible Liberal Party scare campaign on taxes.

“We know that we are facing tough economic challenges ahead, we know that Tasmania’s economy is in transition, and we need to prioritise examining the financial tools over which we have some control to ensure that transition drives a more robust and sustainable economy,” Mr Morris said.

“The announcement that Tasmania is to lose more GST revenue hopefully will be a wake-up call for both the community and the Treasurer, that we are overly reliant on GST grants compared to other states , and we need to be looking at our own outgoings and revenue.”

“The Greens are not scared of this debate because we know that the longer it is delayed, the harder it will become.”

“Tasmania’s share of federal funds is an important investment in our current economic transition, and will assist in placing the state onto a sustainable economic footing, but we cannot rely on it alone.

A modern and workable state taxation system is critical to driving the right type of investment that will position Tasmania for a carbon-constrained future, and provide revenue to deliver essential social services.”

Whilst the Australian Government yesterday adjusted taxes, tax levels and entitlements both up and down, the Tasmanian Liberals seek to deny the Tasmanian Government of this necessary tool by threatening to run scare campaigns, Tasmanian Labor is no better.

There needs to be space in the State economic debate for a mature and rational conversation about the structure of, and the level of income collected through the State Taxation System.

There is no point in the State complaining about ‘lost GST’ as it was never there and we cannot do anything about it. It will be far more productive to debate something that we can control such as whether we have the right taxation mix, and whether we are using tax levers, such as polluter pays options, to put our economy onto a sustainable footing.

With inflation in the health sector eating away at its capacity faster than revenues can be found, it is inevitable that there will be less services every year, unless we find ways of reducing costs and increasing income; we must do both.

“Tasmania’s current state-based taxation system remains highly inefficient as a result of decades of exemptions and concessions granted under pressure from lobby groups and vested interests. For example the current high tax rates on a narrow base for both Payroll and Land Tax means that we have limited income and Tasmania is not competitive with the other states.”

Whilst the Greens do not know, and won’t predict, the outcome of this necessary debate, we believe that it is the responsible course of action to have the debate on how we maintain a balanced budget while delivering the greatest level of service possible, and driving our economic transition towards a carbon-constrained future.”
Tim Morris MP Greens Deputy Leader