Industry wish list

MINING has been one of the main drivers of WA’s economic success and that trend is showing little sign of abating.

The sector’s peak body, the Chamber of Minerals and Energy, believes its hopes were satisfied when WA retained its AAA credit rating but dipped out when the Government increased payroll tax.

Oil royalties have been one of the big revenue spinners for the WA Government’s coffers, largely due to the higher than expected global oil prices.

The gold price also appears to be on the increase.

Rumours indicate that a large amount of the Government’s infrastructure spending will be aimed at the mining sector, predominantly to help the big developments planned for the North West Shelf.

Chamber of Minerals and Energy chief executive Tim Shanahan said the Government needed to maintain its spending discipline.

“I don’t see any reason for the WA Government to raise taxes,” Mr Shanahan said.

“I think the Government will recognise the increased contribution from business and, in particular, the mining industry.”

WHILE the agricultural sector has missed most of the pain from State tax rises, it appears to be the industry hurt most by WA Government tax cuts.

The Department of Agriculture’s funding was cut by 10 per cent last year and is expected to face further pruning this year.

This reduced funding is already having an impact on crucial programs such as skeleton weed eradication.

WAFarmers president Colin Nicholl said farmers had agreed to increase the contribution from grain sales to fund the eradication campaign.

“That will give us an extra $10 million to fight the weed and we want the Government to match it. Last year the Government only put in $380,000,” Mr Nicholl said.

The weed is of particular concern to farmers because it could leave WA with a $500 million a year cost.

Road funding under the old Transform WA program also appears to have disappeared.

Mr Nicholl said many rural roads were already in bad disrepair and some planned road works, such as the widening of the road between Corrigin and Hyden, had been abandoned.

WA’s transport sector is being hit twice – by land tax and stamp duty on motor vehicle registrations.

Land tax hits dealers who are required to take high-profile sites close to main roads.

With the valuer general’s tri-annual revaluations expected to come into effect in July, a further land tax hike is expected.

The other big concern is the 5 per cent stamp duty on vehicles worth more than $40,000.

Large trucks and the trailers they tow are caught by this tax.

Queensland, which only raises a 2 per cent tax on truck sales and no tax on trailers, has become the truck and motor body building capital of Australia.

And the industry is not expecting any lessening of the high stamp duty either.

The higher stamp duty rate was brought in by the Court Government in 1999 and the Gallop Government shows little sign of removing it.

Motor Trades Association executive director Peter Fitzpatrick said some truck drivers were buying their trucks in WA and then having them registered in Queensland.

“That means the Government is even missing out on its stamp duty,” Mr Fitzpatrick said.

THE property sector is bracing for another high taxing WA budget – nothing new for the highest taxed sector in the WA economy.

Rumours have been circling that commercial stamp duty will rise in this budget – something Property Council of Australia WA executive director Joe Lenzo brands a “nonsense”.

Mr Lenzo said the WA Government’s budget kept the same taxes it had before, and he doesn’t expect much in the way of any reductions.

“We would like to see the Government saying it will start to reduce commercial stamp duty from this budget and give a timetable for those reductions leading to a total abolition of the tax in 2005,” he said.

“But I don’t think this budget will say anything about stamp duty.”

The Government has already received a huge gain from stamp duty on conveyancing due to the housing boom that hit WA – thanks largely to the First Homeowners grants.

It is also expected to gain a boost from land tax due to the valuer general’s tri-annual review of land values.

SMALL business appears to have emerged largely unscathed from the effects of the State Government’s last budget.

And it expects to emerge pretty much unscathed from this one, largely because most State taxes do not directly hit small business.

However, they hit the larger businesses, which in turn pass on the work to smaller businesses, so any tax increase will have a negative effect in the long run.

Combined Small Business Alliance chief executive officer Oliver Moon said the previous budget had little in it for small business but nothing overly detrimental either.

“But we don’t hold out any hopes of anything from Government boosting the lot of small business from this budget,” Mr Moon said.

Small Business and Enterprise Association executive director Philip Achurch said even though tax increases had little immediate effect on the sector, any further hikes would be unwelcome.

“Small business was supposed to be quarantined from tax rises in the last budget and it really wasn’t. I would hope that it is further quarantined in this budget,” he said.

WA Retailers Associaton chief executive officer Martin Dempsey said the Government had promised to review property charges and it had not.

“Despite that small business came out of the last budget fairly well,” Mr Dempsey said.

“But there is a big concern, largely from medium-sized retailers, over payroll tax. That is going to cause some problems. We’re hoping for a budget that is small business aware rather than small business adverse.”

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