This week the Queensland Government has been talking about scrapping the fuel subsidy. This is a very sensible idea – blanket subsidies (such as the first home owners grant) are hugely expensive, are being paid to those who don’t need financial assistance (not just those who do), and only distort market forces (and create inefficiencies and dependency). Most of the fuel subsidy is no doubt ending up in the banks of the petrol-selling foodchain, rather than consumer pockets.
HOWEVER – the money saved by the Queensland government MUST be used to IMMEDIATELY help defray the huge cost of living in remote areas, where residents may have to drive a couple of hundred kilometres or more just to visit a bank, post office or supermarket. They have no public transport to choose from and driving for many miles is unavoidable, and already the price they’re paying for fuel is a lot higher than what coastal residents are paying, although they have the luxury of government-subsidised public transport and short distances to travel to essential services.
Helping remote residents with travel costs can be done in far more effective ways than a blanket fuel subsidy that applies to everyone, whether they’re living in inner-city Brisbane or hundreds of kilometres from the nearest hospital. The state government can ensure justice for all taxpayers in two ways:
1) By immediately increasing the amount payable under the Patient Transit Scheme, so that the full cost of travel and accommodation is covered – especially for those who must travel away regularly for ongoing essential healthcare reasons.
2) By pressuring the Federal Labor Government into overhauling the Zone Tax Offset (previously known as the Remote Area Tax Rebate Scheme). Introduced after World War II by Prime Minister Ben Chifley, the amount of tax rebated to someone living in the remotest region, is now so worthless, in relative terms, it is a bad joke. As is the fact that this rebate is paid to well-fed and well-paid fly-in fly-out miners, who it is debatable should even qualify, given that they are not continuously residing in remote areas for 6 months at a stretch without a break.
Member for Kalgoorlie, Barry Haase, has been calling for such a review for several years – at least since 2006. Other politicians have raised it at various times, such as Democrat Senator Andrew Murray, in a comprehensive Parliamentary Speech in 2003.
Remote area residents save only about $1,173 tax – so they’re subsidising everything in urban areas, that they can’t access themselves – from museums and art galleries, to heavily subsidised public transport and grant-assisted community festivals. Including spectacular wastes of money, such as New Years Eve fireworks on Sydney Harbour Bridge.
These things should happen to the Zone Tax Offset:
– the zone A & B maps should be redrawn to reflect population, road and public transport availability changes. People living in and around regional centres which have grown in size should be excluded from the scheme (an improved Patient Transit Scheme would cover expenses incurred in travelling down to Brisbane, from remote & regional cities, for essential medical treatment not available anywhere else in Qld – thus the funding would be more efficiently targeted at those who actually needed it). For decades there has been Zone A and Zone B – an expansion of the number of zones – from rural to very remote and a category inbetween, is long overdue.
– anyone who doesn’t live continuously in remote areas for 6 months at a time should be excluded (i.e., fly-in fly-out miners and other well-paid professionals who visit regularly, but don’t actually reside in remote areas). Such people are not faced with the extra costs associated with remote living as they do their buying when at home in the city (they are generally fed, housed and/or recompensed by their employers), and nor are they actually residing in remote areas (thus doing nothing to improve decentralisation, which was one of the main aims for the rebate’s introduction), so why on earth should they be receiving remote area tax rebates? Paying this group only reduces the amount available for those who genuinely need it to feed, educate and otherwise raise their families, full time, in remote areas.
– the amount of the Zone Tax Offset should be immediately increased to accurately reflect the much higher cost of living in remote areas – particularly for families. It has not increased since 1992 and hasn’t increased in real terms, for many decades. It should have been increased immediately when the GST was introduced, to offset the fact that remote area residents are paying far more non BAS-claimable GST than residents in closely settled areas. For example, a fridge may cost someone living in a remote area $1200, instead of the $1000 they would have paid on the coast. $109 of that cost will be GST, whereas the coastal resident will only have paid $90.91 GST. On just one essential item, the remote area resident has paid $18 more GST. Multiply the extra paid on general living expenses, over a whole year, and the remote area resident – especially a family – ends up paying thousands of dollars more in GST, because what they’re buying is more expensive due to extra freight and/or local businesses having to charge higher prices due to lower turnover/lack of bulk buying power. (Urban residents can also easily reduce cost of living expenses by taking advantage of sale prices, and by purchasing second hand items, which remote area residents are almost entirely unable to do.)
– the Zone Tax Offset rate should be linked to the CPI so that increases keep pace with general cost of living increases.
Tags: Living in the country and remote areas, Remote area zone tax rebate, Australian decentralisation