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Canberra Today 13°/16° | Friday, March 29, 2024 | Digital Edition | Crossword & Sudoku

Barr: our long term tax agenda

STAMP duty, residential land tax and taxes on general and life insurance could be abolished within the next 20 years, if recommendations of the ACT’s taxation review are adopted.

The Quinlan Review, plus the Government’s “in-principle” responses were released this morning, nine months after it was expected to be delivered.

“It’s a substantive report, contains many many recommendations, I don’t believe in fast food politics I think our need  for instant gratification for things to roll through in 24 hour cycle is what’s dumbing down political debate in this country,” Treasurer Andrew Barr said.

“So yes, I’ve taken some time to look at these issues. To put forward a thought out and considered response and then moving into an implementation phase. I think the era of this just being a throw-away document that just sits on the shelf and the debate being contained within 24 hour media cycles needs to end and that’s what we’re doing.

“This is a 20 year reform agenda, so I think it’s entirely reasonable to spend a few months looking at the detail.”

The review analysed the Territory’s tax system in comparison to other jurisdictions, the ACT’s economic structure, the ACT’s socio-demographic composition, expenditure needs and Government policy objectives.

The Government agreed to 15 of the review’s recommendations; in-principle support to 14 recommendations, noting one and not agreeing with one recommendation to consider poker machines in the Canberra Casino – a decision in line with the Government’s community gaming model and with the gaming licence agreed by the current operator.

The review was led by former ACT Treasurer Ted Quinlan, UC’s Prof Alan Duncan and Under Treasurer Megan Smithies.

“The Review has confirmed that, when considered in context, the ACT is not a high taxing jurisdiction. Indeed, it concluded that the overall level of taxation in the ACT is more efficient relative to the national average,” he said.

“However, the Review found that there were risks to the long-term sustainability of the ACT’s revenue – the GST base is eroding, the cost of health services is rising faster than the economic growth rate, and major taxation measures are volatile, unfair and unsustainable.”

Mr Barr said the ACT need not wait for national action.

One recommendation, “with regards to long term structural reform, over a period of time that is adequate for appropriate transition” included the abolition of stamp duty – agreed in principle by the government, rating a form of tax on payroll to maintain a diversified tax system,  the abolition of duty on general insurance and life insurance, and a broad-based land tax as a base for revenue replacement – agreed in principle by the government.

The Government also agreed in principle with the recommendations that over time, the residential lad tax in its current form be abolished and that the commercial component of land tax be transferred to general rates on commercial properties.

Another agreed recommendation was the introduction of parking fees in the Parliamentary Triangle.

Mr Barr said he will be holding “roundtable” starting next week with stakeholders who wrote submissions for the review.

However he said the public has “ample opportunity” to make comment on the review with public submissions now open.

Roundtables will be held May 14, May 16, June 25, July 23. To submit a view on the Quinlan Review and the in-principle responses email  taxreform@act.gov.au

The review and the Government responses are at www.treasury.act.gov.au/about/publications.shtml

 

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