Mr BURKE - 1995-06-20
Has the Treasurer been able to establish the impact that the federal government's proposed 12% wholesale sales tax on building materials will have on the Territory?
ANSWER
Mr Speaker, I thank the member for Brennan for his question. It is particularly pertinent for his electorate, given the building boom that is occurring there. The tax will make quite an impact if it is introduced successfully. I understand that the Democrats and the Liberal and National Parties will be voting against the proposed tax in the federal parliament.
Mr Bailey: We will do the same with the fire service levy.
Mr COULTER: Fire service levies are in place in every jurisdiction in Australia.
When the federal budget was handed down in May, the hairs stood up on the backs of the necks of those in the building industry. The reason is the proposed 12% wholesale sales tax - a tax on tax - which the government expects to introduce from 1 July on all building materials that were previously exempt. This decision is illustrated best by a television commercial that has been running in Darwin. It starts with the architects of the tax - the Prime Minister, Mr Keating, and the Treasurer, Mr Willis - standing side by side. The words 'tax, tax, tax' appear all over the picture, followed by encouragement to get in now, save money and beat the budget before the federal government introduces its 12% wholesale sales tax. The advertisement captures the very essence of this tax.
From 1 July, the cost of building materials will add more than $1000 to the cost of building a new home. Everything will rise in price - from bolts, screws, nails, rivets, washers, hinges, handles, knobs, locks, hooks and springs to plaster and plaster mixtures, wooden floor coverings, paints, putties, fillers, thinners and wallpaper, not forgetting taps, nozzles, tap handles and shower heads. That will send the member for Barkly on an international hunt for tiles, not simply to South Australia where she went to purchase her materials when she was renovating her house. That list is from the federal Treasurer's press release issued on 9 May. The only thing he did not mention was the kitchen sink, but that did not miss out. The tax on kitchen sinks will rise by 12% also.
The wholesale sales tax will add more than $1000 to the cost of building a new home. In the Northern Territory, where owning one's own home is still an achievable proposition - in fact, we have the most affordable housing in Australia - this is a tax that the industry does not need. Not only will the home owner be affected by this tax change, renters also will feel the sting of this tax. The Housing Industry Association estimates that private sector rents will rise by $120 a year. That means nobody in the community will miss out on feeling the effects of this tax. The federal government plans to raise $216m from this proposed tax.
At this point, the industry's complaints have fallen on deaf ears as far as the federal government is concerned. The federal Treasurer has been less than receptive to industry
Page 639
groups who oppose the tax. There is now only one hope left for the building industry and all Australians to defeat this tax, and it rests with the combined forces of the federal opposition and the Democrats who have announced publicly that they will oppose the tax when it reaches the Senate. We hope that the Democrats are true to their word. They are a bit of a worry because, as has been aptly said of them, they can be rented by the hour. If Mr Keating gets hold of them for 5 minutes, he probably will persuade them to change their minds. However, let us hope that they remain true to their word and join the federal Coalition in opposing this tax. That would see it defeated. I think we all agree that that would be the best possible outcome as far as the Northern Territory's building industry is concerned.
I table some media releases relating to the costs. The Master Builders Association estimated the costs to which I referred earlier - that is, the $1000 cost for a house and the additional $120 a year for private renters. I table also the federal Treasurer's press release which indicates quite clearly the list of materials that will be taxed to raise this $216m - materials that were exempt previously - so that members may appreciate the full impact of this tax. Certainly, it will be a very heavy burden on people purchasing or renting a house. Nobody will escape it, and I wish the Democrats and the Coalition well in their efforts to defeat this absurd tax.
Page 640
ANSWER
Mr Speaker, I thank the member for Brennan for his question. It is particularly pertinent for his electorate, given the building boom that is occurring there. The tax will make quite an impact if it is introduced successfully. I understand that the Democrats and the Liberal and National Parties will be voting against the proposed tax in the federal parliament.
Mr Bailey: We will do the same with the fire service levy.
Mr COULTER: Fire service levies are in place in every jurisdiction in Australia.
When the federal budget was handed down in May, the hairs stood up on the backs of the necks of those in the building industry. The reason is the proposed 12% wholesale sales tax - a tax on tax - which the government expects to introduce from 1 July on all building materials that were previously exempt. This decision is illustrated best by a television commercial that has been running in Darwin. It starts with the architects of the tax - the Prime Minister, Mr Keating, and the Treasurer, Mr Willis - standing side by side. The words 'tax, tax, tax' appear all over the picture, followed by encouragement to get in now, save money and beat the budget before the federal government introduces its 12% wholesale sales tax. The advertisement captures the very essence of this tax.
From 1 July, the cost of building materials will add more than $1000 to the cost of building a new home. Everything will rise in price - from bolts, screws, nails, rivets, washers, hinges, handles, knobs, locks, hooks and springs to plaster and plaster mixtures, wooden floor coverings, paints, putties, fillers, thinners and wallpaper, not forgetting taps, nozzles, tap handles and shower heads. That will send the member for Barkly on an international hunt for tiles, not simply to South Australia where she went to purchase her materials when she was renovating her house. That list is from the federal Treasurer's press release issued on 9 May. The only thing he did not mention was the kitchen sink, but that did not miss out. The tax on kitchen sinks will rise by 12% also.
The wholesale sales tax will add more than $1000 to the cost of building a new home. In the Northern Territory, where owning one's own home is still an achievable proposition - in fact, we have the most affordable housing in Australia - this is a tax that the industry does not need. Not only will the home owner be affected by this tax change, renters also will feel the sting of this tax. The Housing Industry Association estimates that private sector rents will rise by $120 a year. That means nobody in the community will miss out on feeling the effects of this tax. The federal government plans to raise $216m from this proposed tax.
At this point, the industry's complaints have fallen on deaf ears as far as the federal government is concerned. The federal Treasurer has been less than receptive to industry
Page 639
groups who oppose the tax. There is now only one hope left for the building industry and all Australians to defeat this tax, and it rests with the combined forces of the federal opposition and the Democrats who have announced publicly that they will oppose the tax when it reaches the Senate. We hope that the Democrats are true to their word. They are a bit of a worry because, as has been aptly said of them, they can be rented by the hour. If Mr Keating gets hold of them for 5 minutes, he probably will persuade them to change their minds. However, let us hope that they remain true to their word and join the federal Coalition in opposing this tax. That would see it defeated. I think we all agree that that would be the best possible outcome as far as the Northern Territory's building industry is concerned.
I table some media releases relating to the costs. The Master Builders Association estimated the costs to which I referred earlier - that is, the $1000 cost for a house and the additional $120 a year for private renters. I table also the federal Treasurer's press release which indicates quite clearly the list of materials that will be taxed to raise this $216m - materials that were exempt previously - so that members may appreciate the full impact of this tax. Certainly, it will be a very heavy burden on people purchasing or renting a house. Nobody will escape it, and I wish the Democrats and the Coalition well in their efforts to defeat this absurd tax.
Page 640
Last updated: 09 Aug 2016