Mr. Buswell questions the Treasurer regarding a 2001 Labor Party promise on tax competitiveness, citing increased taxation per capita. The Treasurer defends the government's record by highlighting economic growth and tax reforms, arguing that tax as a share of gross state product is the more relevant measure.

AnsweredQoN 158Legislative Assembly
Asked
12 April 2006
Portfolio
Treasurer

QuestionView source ↗

LABOR PARTY ELECTION POLICY 2001
I refer to the 2001 Labor Party election policy entitled “Getting value for money”, in which Labor committed itself to maintaining or improving Western Australia’s tax competitiveness in comparison with other states, as measured by taxation revenue per capita. The latest figures from the Chamber of Commerce and Industry of Western Australia showed taxation per capita in Western Australia increasing during the government’s first five years by almost 70 per cent, from $1 322 per capita to an estimated $2 368 per capita. How can the Treasurer now justify the fact that Western Australia is the nation’s highest taxing state, and is this not another example of a broken Labor tax promise? Mr E.S. RIPPER

AnswerView source ↗

The purpose of a tax competitiveness target is to ensure the best prospects for economic growth. I remind the opposition of the extraordinary figures for the growth in the state’s economy in calendar year 2005. The opposition’s argument about taxation is that it is somehow affecting Western Australia’s economic performance, but the state’s economic performance in calendar year 2005 was growth of 10.4 per cent or, on a year average basis, 7.6 per cent, as measured by the Australian Bureau of Statistics. However, it is important that we have the most competitive tax regime possible into the future. That is why the government is abolishing mortgage tax in two tranches - 50 per cent will go on 1 July this year, and the other 50 per cent will go two years later. That is also why the government is abolishing rental duty, and has committed to abolishing 11 taxes since 2001. The government is committed to tax reform and a better tax system, consistent with providing the services and infrastructure that people want and the wages it is required to pay to public sector workers. We are always willing to consider tax relief, and we will be considering further tax relief later in the term of this Parliament. As we consider tax relief, we must always balance it against services, infrastructure and wages. The best tax competitiveness target is one that measures tax as a share of the gross state product. Mr C.J. Barnett interjected. Mr E.S. RIPPER : The mentor of the opposition criticises that comment, but that is the measure used by Peter Costello when he talks about the Australian government’s taxation performance. He refers to tax as a proportion of gross domestic product, and we do exactly the same in this state because that is the important matter: how much does tax act as a drag on the rest of the economy? We have a target for our tax share to be below the average. Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
Mr E.S. RIPPER replied: The purpose of a tax competitiveness target is to ensure the best prospects for economic growth. I remind the opposition of the extraordinary figures for the growth in the state’s economy in calendar year 2005. The opposition’s argument about taxation is that it is somehow affecting Western Australia’s economic performance, but the state’s economic performance in calendar year 2005 was growth of 10.4 per cent or, on a year average basis, 7.6 per cent, as measured by the Australian Bureau of Statistics. However, it is important that we have the most competitive tax regime possible into the future. That is why the government is abolishing mortgage tax in two tranches - 50 per cent will go on 1 July this year, and the other 50 per cent will go two years later. That is also why the government is abolishing rental duty, and has committed to abolishing 11 taxes since 2001. The government is committed to tax reform and a better tax system, consistent with providing the services and infrastructure that people want and the wages it is required to pay to public sector workers. We are always willing to consider tax relief, and we will be considering further tax relief later in the term of this Parliament. As we consider tax relief, we must always balance it against services, infrastructure and wages. The best tax competitiveness target is one that measures tax as a share of the gross state product. Mr C.J. Barnett interjected. Mr E.S. RIPPER : The mentor of the opposition criticises that comment, but that is the measure used by Peter Costello when he talks about the Australian government’s taxation performance. He refers to tax as a proportion of gross domestic product, and we do exactly the same in this state because that is the important matter: how much does tax act as a drag on the rest of the economy? We have a target for our tax share to be below the average. Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
The purpose of a tax competitiveness target is to ensure the best prospects for economic growth. I remind the opposition of the extraordinary figures for the growth in the state’s economy in calendar year 2005. The opposition’s argument about taxation is that it is somehow affecting Western Australia’s economic performance, but the state’s economic performance in calendar year 2005 was growth of 10.4 per cent or, on a year average basis, 7.6 per cent, as measured by the Australian Bureau of Statistics. However, it is important that we have the most competitive tax regime possible into the future. That is why the government is abolishing mortgage tax in two tranches - 50 per cent will go on 1 July this year, and the other 50 per cent will go two years later. That is also why the government is abolishing rental duty, and has committed to abolishing 11 taxes since 2001. The government is committed to tax reform and a better tax system, consistent with providing the services and infrastructure that people want and the wages it is required to pay to public sector workers. We are always willing to consider tax relief, and we will be considering further tax relief later in the term of this Parliament. As we consider tax relief, we must always balance it against services, infrastructure and wages. The best tax competitiveness target is one that measures tax as a share of the gross state product. Mr C.J. Barnett interjected. Mr E.S. RIPPER : The mentor of the opposition criticises that comment, but that is the measure used by Peter Costello when he talks about the Australian government’s taxation performance. He refers to tax as a proportion of gross domestic product, and we do exactly the same in this state because that is the important matter: how much does tax act as a drag on the rest of the economy? We have a target for our tax share to be below the average. Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
Mr C.J. Barnett interjected. Mr E.S. RIPPER : The mentor of the opposition criticises that comment, but that is the measure used by Peter Costello when he talks about the Australian government’s taxation performance. He refers to tax as a proportion of gross domestic product, and we do exactly the same in this state because that is the important matter: how much does tax act as a drag on the rest of the economy? We have a target for our tax share to be below the average. Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
Mr E.S. RIPPER : The mentor of the opposition criticises that comment, but that is the measure used by Peter Costello when he talks about the Australian government’s taxation performance. He refers to tax as a proportion of gross domestic product, and we do exactly the same in this state because that is the important matter: how much does tax act as a drag on the rest of the economy? We have a target for our tax share to be below the average. Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
Several members interjected. The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
The SPEAKER : Order! I have stood as much as I can. The member for Vasse does not have the capacity to talk constantly while question time is on. I call him to order for the third time, and seriously warn the member for Cottesloe that he is no longer the Leader of the Opposition. If he wishes to test the Chair’s capacity to throw people out, he should continue to interject. Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.
Mr E.S. RIPPER : Perhaps I could help by bringing my answer to a rapid conclusion. The important issue is tax as a share of the economy. Our target, on that basis, is that our tax share should be below the average of that in the other states, and the government intends to maintain that target.

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