New $300 fire tax set to hit all houses
LINDA SILMALIS
The Sunday Telegraph
January 13, 2013
HOMEOWNERS will be forced to fork out up to $300 a year under a new fire tax with the O'Farrell government set to overhaul the funding of the state's emergency services.
Volunteer firefighters are already preparing to up their campaign to fight the move, which they claim will lead to a reduction of their budget and loss of identity.
Under the plan, each household and landowner will have to pay a yearly bill of around $300 a year to pay for the estimated $1 billion cost of funding the NSW Rural Fire Service (RFS), NSW Fire and Rescue and the State Emergency Services.
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The scheme would replace the existing system where households who take out insurance pay via a levy added into their premium.
The state government has argued that the system is unfair as only households with insurance contribute.
The insurance industry, which has been lobbying for a new funding regime, calculates that almost 40 per cent of households do not have home contents insurance.
Under one of the proposed funding models, the state government calculates each household with a land value of $250,000 would be charged $267 annually.
NSW Fire Service Association president Brian McKinley said he believed each household would have to be charged around $360 per year to meet the fire and emergency services budget.
The fire volunteer movement is just as concerned at its loss of identity if it is funded via a tax-based system, claiming the community would stop donating to the organisation.
"We raise around $3-4 million from the community and we are concerned that people will stop donating like they did in South Australia because they think they are already paying via their taxes.
"Moving to a centralised system of funding will also mean a loss of autonomy on how the money is spent."
The association also doubts transferring to a property-based tax would result in lower insurance premiums.
Other states to have moved to a property-based fire tax include Queensland and Western Australia, where both use councils to collect the levy.
The Victorian government is to introduce a property-based levy in July, with households paying about $100 each and commercial and large farms paying more. As a sweetener, it promised a $20m concession scheme for pensioners and veterans.
In a discussion paper released under the consultation process, the government argued the existing funding regime was inefficient and unfair.
"The tax on insurers increases the price of insurance, leading to some people to under-insure and others not to insure at all."
The paper said "a wide range" of revenue sources had been considered, but it was clear "a property-based levy" was the best alternative.
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