Tim Morris: Federal Budget confirms: it’s all about state tax reform

Tasmanian Greens said that confirmation in the Federal Budget of a further decline in GST receipts was another setback to the State Budget bottom line, strengthening the case for urgently-needed state-based taxation reform.

Greens Treasury spokesperson Tim Morris MP said that maintaining fiscal discipline will only grow increasingly difficult without strong action to address other areas of inefficiency including health funding.

“This is the same scenario that Tasmania faced in last year’s Federal Budget, and once again we should consider ourselves lucky that we got away with a relatively small reduction in GST receipts,” Mr Morris said.

“There’s now an overwhelming need for a plan to deal with Tasmania’s inefficient, unfair and unsustainable state-based tax system.”

“If we can address our sprawling state tax system, then it will mean less red tape for business, fairer taxes for everyone and boosted state revenues.”

“If we do nothing about tax, then Tasmania will remain overly exposed to the vagaries of GST receipts, which are a highly unpredictable and volatile revenue stream.”

“This year’s figures also highlight the unreliability of Treasury’s forecasts, which provide a very shaky basis for State’s budget planning across the forward estimates.”

“Looming above this is the even greater threat posed by Tony Abbott’s Liberals to Tasmania’s share of GST.”

“The Liberals cannot be believed when they promise that Tasmania will be no worse off, because Tony Abbott has shown that he will do and say anything to get elected.”

Mr Morris said that the Budget numbers also strengthened the case for the State and Commonwealth to implement the Greens’ call for a pilot single-funder health model in Tasmania.

“Health is the single largest area of expenditure for state governments, and health funding and workforce reform is one area where Tasmania has an opportunity to significantly improve efficiency.”

“We are facing a funding crisis in health, and without decisive action we face a situation where the cost of delivering health will soon outstrip the entire State Budget.”

“A a single funder model would help address funding inequities and inefficiencies, remove duplication and reduce waste, all of which are hampering our ability to get health onto a sustainable footing.”

Mr Morris also welcomed the budget measures for disability services and education, as well as important funding packages for regional economic development in Tasmania.

“The funding allocated under the Regional Development Australia program and the money that will flow as a result of passing the Tasmanian Forests Agreement Bill will also help the modernisation of Tasmania’s economy.”
Tim Morris MP Greens Treasury Spokesperson Wednesday, 15 May 2013