E&OE
HOWARD SATTLER:
When I was first asked to comment on the levy that is being imposed on us who are taxpayers earning over $50,000 a year, when I was asked to comment on it the other day, first of all on the Sunrise program on Channel 7, I said, without knowing, did they consider that some flood victims would be also asked to pay the levy. And then I read in the press that they wouldn’t be. But now I believe, I am being told, some might be. How can that be? Joining us now is Senator Scott Ryan, he’s shadow Parliamentary Secretary for Small Business and Fair Competition, and he’s on the line. G’Day Scott.
SCOTT RYAN:
Good Afternoon Howard, how are you?
HOWARD SATTLER:
How can this happen? Who would these people be?
SCOTT RYAN:
Well, the Prime Minister said those who were affected by the flood wouldn’t pay the levy, but it has become apparent overnight and today that if you are a small business, who receives a grant to help you recover, or if you’re receiving an income subsidy, because for example you couldn’t work, but you didn’t qualify for the payment because your home wasn’t inundated you could still pay the levy next year.
HOWARD SATTLER:
So the ones who aren’t going to be affected are those who receive, say, a $1000 per eligible adult and $400 per eligible child, obviously children don’t pay, but this comes under the government’s disaster recovery payment, those people wouldn’t pay, but there is another category. Is that what you are saying?
SCOTT RYAN:
There are a couple of other categories Howard. For example, you know, if my home wasn’t inundated but I couldn’t go to work, I am eligible for an income subsidy, because I couldn’t earn income during that period. Now that doesn’t exempt me from paying the levy if I am back at work and I make the requisite income next year. Similarly, if I am a small business person, and I am getting one of the grants to help me recover, or indeed if I am a farmer getting one of the grants to help me recover, there is no exemption from this flood levy.
HOWARD SATTLER:
So if you start earning money in the new financial year and you are under those categories and you earn more than $50,000, which is not a huge amount these days, you will be eligible?
SCOTT RYAN:
Yeah, you will be stuck with the flood levy, the flood tax.
HOWARD SATTLER:
Has anyone questioned the government about this, to find out whether or not they are going to allow that to happen?
SCOTT RYAN:
Well one of the responses I read, I obviously haven’t spoken to anyone in the government Howard, but one of the responses I read in the press today was that the Government said that you wouldn’t be earning income therefore you wouldn’t pay the tax.
HOWARD SATTLER:
But that’s now.
SCOTT RYAN:
Exactly. That’s exactly right. If you’re receiving support now, next month and the months after, but if you’re back on your feet come July, and you earn the $50,000 next year, then all of a sudden you are paying the levy. And with farmers in particular, we are seeking clarification on this, because I know in my home state of Victoria, a lot in Western Victoria have lost crops, but they would be hoping to be back on their feet and have another crop if the season is good next financial year.
HOWARD SATTLER:
I’ve got a couple of emails here that I might just get you to comment on, you probably can’t clarify them, but someone said, if you have a two income household, and each wage earner is earning $49,000 each, they will escape the levy, but a single income household that earns exactly the same amount of money, add the two together, $98,000, will pay. That would be right too, wouldn’t it?
SCOTT RYAN:
That’s definitely our reading of it. Today, again, one of the things we’re seeking clarification on, it’s based on individual income, so that makes perfect sense on a plain reading.
HOWARD SATTLER:
So the same income, one lot pays, but the other lot doesn’t.
SCOTT RYAN:
It would seem so. But particularly, it struck me overnight looking into this, is the impact upon small businesses and having spent time in Western Victoria last week, I saw a number of those impacted, and I know up in Carnarvon you’ve got a lot of farmers who have been impacted…
HOWARD SATTLER:
Yeah.
SCOTT RYAN:
…their homes might not have been hit, but they might be receiving assistance to recover, they could be stung by the levy next year.
HOWARD SATTLER:
And what if you’re a person who’s earning say over $50,000 a year, but all that money, is going, and trying to pay for insurance or damage to your property for insurance you didn’t have, and that sort of thing. You’ll have to pay too, won’t you?
SCOTT RYAN:
That’s exactly it. It’s based on your taxable income. So you could still be recovering from the floods, putting your small business back together, re-employing people, and not only you but your employees if they were eligible for this subsidy who lost wages this financial year can be stung next financial year.
HOWARD SATTLER:
And we’ve got a cyclone heading towards Perth, I don’t know whether you’ve heard the news, but we hope it doesn’t hit us, and we hope it doesn’t hit the south-west, but it is heading this way. One SMS-er has said, will Gillard exempt us from the new tax if we get cyclone damage and have to pay for repairs there?
SCOTT RYAN:
Well all the Prime Minister has done is exempt those who receive the recovery payment, that $1000 you mentioned, all the other people receiving flood assistance, can be eligible for the tax, this extra tax. Even while they are busy recovering from the floods and natural disasters.
HOWARD SATTLER:
So if you get smashed by a cyclone in the next few days, and you are still earning over $50,000 a year but all of it is going to trying to repair damage, because I am not sure whether the insurance companies would cover that, you’ll be asked to pay?
SCOTT RYAN:
Well unless you get one of these payments. That’s the only test the Prime Minister, the only exemption the Prime Minister has issued. All the other programs don’t qualify.
HOWARD SATTLER:
The thing has got holes in it everywhere, hasn’t it?
SCOTT RYAN:
The Coalition’s position is pretty strong. You don’t help people get over a natural disaster like this, right around the country, by hitting them with an extra tax. When there are billions of dollars in the Budget that the government could redirect for this.
HOWARD SATTLER:
But you’re being painted as callous bastards by the government.
SCOTT RYAN:
The reception I have had at home in Victoria, has been that there is a lot of angst about this. They see a Budget with incredible amounts of waste. The government wasted nearly twice as much as this on pink batts for homes.
HOWARD SATTLER:
More than that I would have thought. I think it was $2.5 billion, and then you add another $400 million to try and clean up the mess.
SCOTT RYAN:
And then you’ve got the wasted money on the school halls and the rorts there, and then you’re adding up a billion dollars here and there and pretty significant wastage.
HOWARD SATTLER:
I don’t know whether you’ve heard the news over there yesterday. In an interview with the Treasurer, I discovered, and put it on him, that there’s over $5.5 billion in the Future Fund, specifically earmarked for infrastructure. So why couldn’t they take it out of there?
SCOTT RYAN:
Well I know that we’ve pointed it out today that billions of dollars in various government accounts, Building Australia, that…
HOWARD SATTLER:
That’s where. In the Building Australia account, administered by the Future Fund board.
SCOTT RYAN:
And you’ve got a $330 billion budget Howard. You know, if the Government can’t find enough for what is really its core business, which is helping Australians recover from unforeseen natural disasters, without whacking another tax on them, including some of the victims, then it hasn’t got its priorities right. It can’t be trusted with money.
HOWARD SATTLER:
Thank you Scott.
SCOTT RYAN:
Thanks for your time Howard.
HOWARD SATTLER:
Senator Scott Ryan, shadow Parliamentary Secretary for Small Business and Fair Competition.