David Smith

David Smith

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    Impact of GST still unclear for local government

    28/01/1993 12:00 AM
     
     
    The impact of the Federal Opposition's planned Goods and Services Tax was still unclear for local councils, Local Government Minister David Smith said today.
     
    "Last week I drew attention to the fact that local services such as rubbish collection, recycling, and council swimming pool admissions would likely attract the 15 per cent GST tax," Mr Smith said.
     
    "The Australian Local Government Association is sufficiently concerned to have announced that it will be campaigning against the GST.
     
    "Now the WA Municipal Association's Deputy Executive Director Ted Chown has voiced his concerns about the GST.
     
    "The point is that the Liberal Party is stone-walling on defining the so-called `commercial' council services that will attract the GST.
     
    "They are saying: `Trust us, everything will be all right,' but that is just not good enough and it is time for them to come clean."
     
    Mr Smith said the WA Municipal Association acknowledged that councils would save $7 million through abolition of the fuel excise but lose $3.5 million through cuts to financial assistance grants under a Federal Coalition Government.
     
    The vital question that remained was the cost of the 15 per cent tax on other council services, such as child minding and fees for the use of local sports grounds, as well as rubbish collection and other essentials.
     
    "A 15 per cent tax on these services to every home in Australia will rake in tens of millions of dollars," Mr Smith said.
     
    "Because the tax increases fees it will deprive local authorities of the capacity to adjust their own charges - for example, every time rubbish collection fees rise by $1.00 they know the fee will actually rise by $1.15 under the Coalition's GST scheme.
     
    "Councils will have to charge the GST tax on their essential but so-called `commercial' services to ratepayers.
     
    "However you slice it, that will mean a hefty increase to household costs because we already know that water and sewerage will attract the GST."