ALGA has raised the importance of taxation revenue at the local and regional level for the provision of essential Local Government services and infrastructure in its submission this week to the Taxation Issues Paper.
The submission asserted the view that an analysis of revenue, including taxation and Local Government's taxation revenue power, cannot be undertaken in isolation from the role of, and allocation of public functions to, Local Government.
ALGA flagged further critical issues including:
- the constraints and restrictions that impinge upon local government’s ability to fully exploit its taxation base (ability to pay, capping, concessions, exemptions and the potential for state crowding out)
- the critical role of intergovernmental grants from the Commonwealth and the states to the sector (both in the form of general purpose funding and specific purpose payments) in order to promote horizontal fiscal equity for all Australians
- the role local government plays in raising some of the taxation revenue within a federalised taxation system.
Submissions received in response to the Treasury Issues Paper are intended to assist the Treasury in the development of a Green Paper as part of the White Paper process, with that Green Paper expected to be released for formal consultation with the community later in 2015.