Policy move to subsidise rates with GST

On 23rd March 2005, the Mayor of Strathbogie Shire, Robyn Machin, in an opinion piece for the Weekly Times newspaper wrote: A widespread view is that local government rates have had their day, the system is broken and an alternaive funding source must be applied, in the form of a 'growth tax'.

The Victorian Nationals are to be congratulated for their proposed policy to use GST revenue to supplement local government. It is a major step towards a more equitable rating system.

But let's take the idea further. If this concept is accepted, it could be looked at on a national level with a view to allocating a proportion of GST revenue to rebuild our failing infrastructure. This could be committed by the federal government and disributed directly to the municipalities bypassing the states where it can too often get resirected.

Under the current system of grants funding, there is no room for planned infrastucture development. It is a case of councils grabbing the cash when they can and utilising it as best they can to keep an ever deteriorating infrasture operative.

How much better would it be if councils knew that specific funds were assured for the maintenance and development of new infrastructure.

It would be nice to think that council rates could be eliminated altogether through a proportional increase in GST from 10% to maybe 12%. This would be a true user-pays system where residents and tourists alike would be contributing towards the national infrastructure.

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Related Article: State Policy on local government

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