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More ESL pain as Treasurer targets an extra $20 million

May 20, 2015
Treasurer Tom Koutsantonis has begun the soft sell of next month's budget.

Treasurer Tom Koutsantonis has begun the soft sell of next month's budget.

UPDATED: South Australians must brace for more Emergency Services Levy pain, with the Weatherill Government set to raise an extra $20 million in 2015-16.

The increase will mean the average household in metropolitan Adelaide – with a property value of $426,400 – will pay an extra $23, or 9 per cent, on their next ESL bill.

But Treasurer Tom Koutsantonis has ruled out introducing a new broad-based land tax on the family home ahead of next month’s state budget.

While the levy has been criticised as a land tax in disguise since Koutsantonis dumped significant remissions to householders in last year’s budget, the Treasurer insists the additional windfall will be poured into extra training and equipment for emergency services.

“South Australia recently experienced one of its most dangerous bushfire seasons, with the Sampson Flat bushfire alone burning more than 12,500 hectares, destroying properties and livestock and requiring the efforts of more than 3500 firefighters and other volunteers,” Koutsantonis said in a statement.

“The State Government has now considered budget bids put forward by the State’s emergency services organisations and identified additional resources that will be funded through the ESL.”

The levy will raise $285.7 million in the next financial year, $19.8 million more than in 2014-15.

Koutsantonis said the revenue was collected in a hypothecated fund in which “every dollar” was earmarked for emergency services organisations. However, the scrapped 50 per cent remission has allowed the Government to free up millions more in general revenue, plugging a budget hole Labor had hoped would be filled with federal funds.

The announcement today suggests the soft sell of next month’s state budget has officially begun, with details strategically dropped to News Corp overnight, but the Treasurer refusing to discuss them on morning radio.

However, at a midday media conference, he declared he could “now rule out (introducing) a broad-based land tax”.

The notion was mooted in the Government’s recent tax review, which suggested “replacing conveyance duty with another tax on property is generally considered most equitable as it would balance any impacts on asset prices associated with tax reform”.

But Koutsantonis said the Government “will not proceed with a broad-based land tax on a family home”.

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He would not be drawn on whether other measures, such as a new tax on commercial properties or changing the existing threshold, would be considered.

This year’s ESL increase had already been flagged in a parliamentary inquiry last month, with CFS Volunteers’ Association executive director Sonia St Alban revealing Emergency Services Minister Tony Piccolo “has not been ruling out additional ESL increases in the future to fund (Labor’s) new emergency services model”.

“That’s a concern we have,” she said at the time.

“We haven’t recovered from the last ESL increase with volunteers and trying to settle the volunteers and community down and we’re already discussing future ESL increases to fund changes…to a system that is already working to national standards.”

Opposition Leader Steve Marshall said “South Australians are already struggling under Weatherill Labor’s excessive taxes and there is absolutely no justification for a further ESL hike”.

“Rather than increasing taxes, Mr Koutsantonis needs to immediately stop wasting taxpayer funds on expensive political attack ads,” he said.

The ESL is set annually depending on the funding needs of emergency services organisations. The Treasurer said this year’s increase would “provide extra support for emergency services organisations, fund the extended workers’ compensation scheme for CFS volunteers, and cover costs incurred as a result of January’s Sampson Flat bushfire”.

“It’s an example of the enormous sacrifice our volunteers make defending life and property, and the importance of ensuring they have the resources they needed to protect themselves and their communities,” he said.

Businesses will also be hit, with commercial properties valued at $1.5 million incurring an extra $187 a year, or 10 per cent, and industrial buildings worth $1.2 million slugged an extra $178 or 7 per cent.

Remissions will remain for eligible pensioners and concession-holders, while some discounts apply in regional areas. However, the ESL cash grab has already prompted widespread outrage in regional communities, with several CFS volunteers threatening to withhold their services.

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