Liberal Democrats’ Senator David Leyonhjelm today welcomed Peter Dutton’s support for removing the GST from electricity.
However, he pointed out that he raised this idea several months ago when he introduced a bill into the Senate to remove the GST from electricity. The bill was defeated, with the government and opposition both voting against it.
"I welcome Peter Dutton’s support for my idea to take the GST off electricity.
"It’s a proposal the Prime Minister should have supported when I raised it. It has the potential to save Australian households hundreds of dollars a year, and might save his own job.
"My costing from the Parliamentary Budget Office shows that taking the GST off electricity would cut tax by $2 billion annually, saving a typical household around $200 a year. My bill could be restored to the notice paper this week, and electricity could be GST-free within days."
Senator Leyonhjelm said electricity is an essential service like water, so electricity should also be GST-free, particularly as we do not have a comprehensive GST like New Zealand.
"A lot of low-income households report they are going without heating this winter because of electricity prices. This is sure to cause deaths, a scandalous situation in any first-world country but unforgivable in a country so rich in resources."
Although the revenue is passed on to the states, the GST is a federal tax. Senator Leyonhjelm said making electricity GST-free would not need the support of the states.
"The states rake in the dough with every electricity price rise. Even after taking the GST off electricity, each state’s budget would remain in a healthier position than the federal government’s budget," Senator Leyonhjelm said.
"More importantly, the people of each state would face dramatically lower electricity bills." ---
