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Treasurer – Royalties

Cassy O'Connor MP  -  Tuesday, 7 June 2022

Tags: Treasury, State Budget

Ms O'CONNOR - I'm fine with you doing that.

Treasurer, you've been subject to a lot of criticism about the level of debt that the Budget carries, and we've been quite cautious in our commentary on this as we recognise that sometimes Government needs to borrow. But there will come a point, and Mr Winter disagrees with me on this, that we will have a revenue problem. Is any consideration being given in Government to examining the mining royalties, the leases, the lease costs on fish farms for example, any other ways that the state can generate revenue by bringing our royalties and licenses up to the national average?

Mr FERGUSON - I did answer that question also earlier today. This is the position that I've put forward, and I've done so publicly, as has the Premier. It's interesting because I think sometimes our comments have been, if you like, amplified or interpreted in a particular way. I'll just restate it: we're open to reforms that are beneficial for our state and would potentially improve the lives of Tasmanians in the future. We're not ruling out sensible, common-sense reforms such as this state is going to have to do as it did with the waste levy.

Ms O'CONNOR - That's right.

Mr FERGUSON - We had to do it.

Ms O'CONNOR - Of course.

Mr FERGUSON - And to not do so would have been irresponsible on a variety of levels, economically and environmentally.

Ms O'CONNOR - Yes.

Mr FERGUSON - So we crossed that bridge and already, on that quite affordable and sensible policy, we're already subject to politicking by the official Opposition.

Ms O'CONNOR - They're shocked.

Mr FERGUSON - We will also have to cross the bridge on adequately funding our fire and emergency services, and there's an options paper in circulation around options to make reforms to fire service levies and charges that are variously charged on insurance and motor vehicles on people's rates bills. The Government wants to have a look at that, and we have an appetite to try to do things that will really support the long-term security of our state and our safety. After all, we had a huge fire across our state only a few years ago, and I thank God we got through that and we had a lot of support across the state and from other states and even other countries.

We want to be as strong as we can going forward, so while I am not attracted to flashing out new taxes or royalties or charges because we are a pro-jobs and pro-industry government, I am not ruling out sensible changes or reforms - just as we have done to land tax - that are sensible and sustainable for our budget and support our economy to grow and do well in the future.

Ms O'CONNOR - Can I ask whether you have asked Treasury to provide advice on any of these potential revenue generating measures, but particularly something that we have talked about a lot for the last couple of years, which is the fact that we have got such cheap royalty and license fees in Tasmania? Has any work been done on that? A look at other jurisdictions? A look at how we could cautiously, potentially increase them to improve the budget bottom line? There is no way that a mining company that has got a rich resource here is going to be scared off because we have got the same royalty rates as another state.

Mr FERGUSON - I can only answer the question in the same way I did before. I did quite -

Ms O'CONNOR - Thoroughly.

Mr FERGUSON - No, I did quite instantaneously say to Dr Woodruff earlier that we are a Liberal Government, we are not going to be wanting to rack up royalties and taxes in a way that we know will impact on industry sustainability and jobs in Tasmania. We will do what is sensible for our state with our particular view on life and the economy, and so I don't want my answers to give anybody license to go off and say we are going to rack up taxes and charges, because we are not going to do that.

Ms O'CONNOR - No, I understand that. I understand that you are cautious about this answer, but given that it is a matter of fact that Tasmania is at the very low end of royalties and license fees, which impacts on our budget bottom-line, isn't it a question you have ever asked in Treasury just to understand what the lay of the land is?

Mr FERGUSON - I am a new Treasurer, have been there for all of eight weeks, and I have not asked for that advice. I don't intend to soon, but I am open to proposals that sustain and grow the economy and jobs, and reduce the tax burden on taxpayers wherever possible and if there are sensible, practical, commonsense reforms that can modernise the way that we do things, the Premier and I have said publicly and here today, that we are open to proposals. But there are none in front of us and we haven't called for any either. I can sense in the room everybody is hanging on every word I say, looking for political opportunity.

Ms O'CONNOR - Yes, fascinating.

Mr FERGUSON - But that is the position that I have got to share with the committee noting that even a sensible, solid-waste levy has been characterised as a 'bin tax' that should be repealed. It was the only thing that Labor could hang its hat on in its so-called 'technical alternative budget'.

Ms O'CONNOR - Yes. Agree.