Australian flood tax to impact on major road projects

The new flood tax announced by the federal government last week is set to impact on major road projects which will be delayed to fund flood recovery efforts.

With heavy transport issues already caused by the floods, many are claiming that the move to delay these road projects will have a negative effect on transport companies trying to ship goods around, particularly in flood affected zones in Queensland.

“Many infrastructure projects are intended to relieve the impact of flooding and it would be ridiculous if such projects are included on the list to be deferred,” Warren Truss, Leader of the Nationals, said.

Minister for Infrastructure and Transport, Anthony Albanese, is due to name the programs that will be delayed. Projects in other states than Queensland will also be deferred to save about $675 million.

The delays are expected to be anywhere between one and three years.
Prime Minister Julia Gillard says that preliminary estimates the national floods will costs the federal government over $5.6 billion, with Queensland accounting $3.9 billion.

“The great floods of this summer have been a national tragedy. In time they may prove to be the most expensive disaster in Australian history,” Ms Gillard said.

There will be a 0.5 percent tax for taxpayers earning between $50,001 and $100,000.Those earning more than $100,000 will pay an extra 1 percent, while those earning less than $50,000 and those affected by the floods will not pay.

The tax will take effect next financial year and is expected to raise $1.8 billion.

“Under this levy, someone who has an income of $60,000 will pay just under $1 extra per week. A person earning $100,000 per year will pay just under an extra $5 per week,” Gillard says.

“This will save $325 million in the Budget period. And these changes have been agreed to by the Queensland Government,” she says.

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