Government abandons plan to introduce premium land tax

11/10/01
The State Government has abandoned its plan to introduce a premium land tax.
Premier Geoff Gallop said the decision had been made in response to growing community opposition to the tax, which was to have raised $12 million this financial year.
"We are a Government that listens and we have heard what the community has to say," Dr Gallop said.
"As a result, the premium land tax is dead."
"To replace this revenue loss, the Government will make up the $12 million shortfall through reduced spending in 2001-02."
The Premier said he and Treasurer Eric Ripper had recommended to a meeting of Cabinet Ministers last night that the proposed tax be dropped.
The meeting agreed to a $12 million package of cuts and deferred spending. These include:

• saving $2 million through additional cuts in consultancy and advertising expenditure;

• deferring for one year $5 million in expenditure from the $25 million allocated to the Regional Investment Fund this year;

• deferring for one year $4 million in expenditure from the $6.53 million allocated to the Innovate WA fund this year;

• deferring for one year $500,000 in expenditure from the $1.25 million allocated to the contemporary music program; and

• delaying by nine months the implementation of a new native title program, saving $500,000.

Dr Gallop said the premium land tax was a response to unexpected budget pressures inherited from the previous Government. Those pressures still remained and had been exacerbated by recent world events.
He said the new tax had been motivated by the Government's desire to protect families and small business, which had borne the brunt of the GST.
"It is clear, however, that many people who would never have had to pay the tax believed it would some day apply to them," the Premier said.
"It had also become clear that this proposal was becoming an increasingly divisive issue at a time when community cohesion is paramount."
Dr Gallop said the decision to drop the proposed tax would have an impact on the forward estimates and that this would be addressed in the next Budget.
"The Expenditure Review Committee will continue to scrutinise every dollar of Government spending and we do not rule out further spending cuts in the future," he said.
Media contact: Kieran Murphy 9222 9475