7 February 1999 GST a setback to health and wealth in rural and remote communities A Goods and Services Tax (GST) is inequitable because of its disproportionate burden on the residents of rural and remote communities, particularly Aboriginal and Torres Strait Islander people - the poorest and most disadvantaged sector of the Australian community. ATSIC's Northern Territory (North) Zone Commissioner, Ms Josie Crawshaw, said today that this is the conclusion of detailed independent studies commissioned by ATSIC on the impact of the GST. The studies, by Professor Owen Stanley of James Cook University and Dr David Charles and Mr Brad Coles of the Allen Consulting Group, underpin a detailed submission to the Senate Select Committee on a New Tax System publicly released today by Commissioner Crawshaw on behalf of the Commission. "ATSIC concedes that tax reform may well be overdue," she said. "However, we have serious concerns that the GST will simply compound disadvantage." Commissioner Crawshaw said the tens of thousands of indigenous Australians living in rural and remote communities faced extremely limited job opportunities. "They rely on income support such as the Community Development Employment Projects scheme, family support payments and pensions. Fixed incomes are often below the 1996 average wage for indigenous people of around $14 000 - itself two-thirds the average wage in the non-indigenous community. "Income tax relief is largely irrelevant at these levels. "Our people have been running hard simply to stay in the same place - to achieve basic survival at very poor levels of health. The GST would see people enter a further spiral of disadvantage as they spend more for less. "If the basic diet is eroded because people simply can't afford to buy enough or better quality food, their health will further deteriorate. In turn, the cost of providing appropriate health services will increase." Commissioner Crawshaw pointed out that expenditure surveys based on ready access to mainstream supermarkets suggest around 40 per cent of household income is spent on food. In Darwin, the city with the nation's highest supermarket prices, people pay $142.83 for a food basket that costs $109.36 in Townsville. A GST on this basket would be $3.30 more in Darwin than in Townsville. In more remote locations, the cost would be much higher. Actual prices in community stores - usually facing no competition and setting their own mark-ups - depended on distance from the nearest major centre. Commissioner Crawshaw said remote communities sometimes payed twice the prices charged in the cities and towns of south-eastern Australia. The reduction of the diesel fuel excise was likely to have a negligible effect on transport costs because other forms, like aircraft and barges, were also involved. "ATSIC's submission shows that the proposed tax reform will increase hardship on indigenous communities because it will add considerably more to the cost of living than the 1.9 per cent calculated by the government," she said. "The GST will also be counter-productive to economic development as it has the potential to be a disincentive to business and employment and reduce the ability of community organisations to provide services. "The government would need to introduce additional measures to stimulate economic activity in those communities and increase funding to ensure that rising costs do not mean a reduction in the level of services." NB: A summary of recommendations is attached. The full ATSIC submission and attachments are available from this site. ---- Media contacts: Francine Chinn (NT Media Officer) 0419 819 025 Martin Freckmann 018 631 045 Attention Radio News Editors: Two short audio grabs accompany this release - to access, dial 02 6262 5850 and enter access code 3000. ------------------------------------------------------- RecOzNet2 has a page @ http://www.green.net.au/recoznet2 To unsubscribe from this list, mail [EMAIL PROTECTED], and in the body of the message, include the words: unsubscribe announce or click here mailto:[EMAIL PROTECTED]?Body=unsubscribe%20announce This posting is provided to the individual members of this group without permission from the copyright owner for purposes of criticism, comment, scholarship and research under the "fair use" provisions of the Federal copyright laws and it may not be distributed further without permission of the copyright owner, except for "fair use."
