Wed, 14th May 2008

Working families slugged by travel tax grab

The Hon Christopher Pyne MP
Shadow Minister for Justice & Border Protection
Shadow Minister Assisting the Shadow Minister for Immigration & Citizenship

“Australian working families looking to take a break and have a holiday are going to be slugged as of 1 July 2008 by a new tax courtesy of the Rudd Government’s first Budget,” said Shadow Minister for Justice and Border Protection, Christopher Pyne.

“The 2008/09 Budget has revealed an increase in the Passenger Movement Charge from $38 to $47 – a 18% increase that will force up the price of airline tickets for Australian holiday makers, as well as overseas tourists.

“This is another inflationary tax hike to add to the growing pile with taxes on pre-mixed drinks and luxury cars announced pre-budget.

“The Government has been especially tricky in relation to this measure. They claim in their promotional material that this tax – which will raise $459.3 million over the next four years [Budget Paper 2, Part 1, p7] – is necessary to offset ‘the cost of a range of aviation security initiatives’ and ‘the costs of processing international passengers at international airports’.

“If this were true then we would see that money put back into Customs. The fact is that Customs has seen its budget slashed this year by $51.5 million in real terms [Budget Paper 4, p23 – based on CPI of 3.25%].

“This is really a raw deal for Customs. Next year alone they will collect $106.3 million from this tax on the public, only to see it funnelled into Wayne Swan’s general revenues, as they have to continue protecting Australia’s borders with reduced funds.

“The Opposition calls on the Rudd Government to admit that this revenue will not be used to protect Australian travellers, and that this is just another ALP tax hike.”