In Industry

Victoria Minister for Health David Davis

Victoria Minister for Manufacturing David Hodgett

Labor’s FBT Changes Will Cost Victorian Families And Businesses Millions

Victor P Taffa

The Federal Labor Government must immediately release the secret Lavarch report into tax concession changes that will hit the pay packets of Victoria’s health and charity workers, and that is currently crippling the Victorian automotive manufacturing sector, Minister for Health David Davis and Minister for Manufacturing David Hodgett said today.

“This secret plan should be released now. It should be released before Saturday so that people can vote on the proposals that Kevin Rudd has in the bottom drawer to cut funding to charities, to cut funding to public hospitals and to cut funding to ambulance services.” Mr. Davis said.

“All of these services, many in the health sector, are going to be hit for six if Prime Minister Kevin Rudd is returned, pulls the secret Lavarch report from the bottom drawer and implements its potentially terrible and damaging proposals.”

“The direct financial impact of the amended Fringe Benefits Tax (FBT) change on health and community service workers is more than $20 Million per year in Victoria.”

“In addition, if eligible employees were to be compensated it would cost more than 15 times this figure.”

“The Victorian community has a right to see what other nasties are hidden in the report of the not-for-profit sector tax concession working group.”

Mr. Hodgett said that since their announcement on July 16, the FBT changes had had catastrophic consequences for the automotive sector.

“Automotive manufacturers everywhere are crying out in pain, after these FBT changes were dropped out of the sky with no warning and no consultation.” Mr. Hodgett said.

“Today is the third of six Ford down days that are directly attributed to the FBT changes, and right across the sector sales have ground to a halt.”


VIC Minister for Manufacturing David Hodgett

VIC Minister for Manufacturing David Hodgett











“It was reported today that $160 Million in sales was lost in August alone, and earlier this week that Ford and Holden were facing a 20 year low in sales, all because of these disastrous FBT changes which are killing demand for cars.”

 “These changes stand to reduce local car production by 20%. The sector employs 24,000 Victorians. We are talking about thousands of job losses if these changes go ahead.” Mr. Hodgett said.

Mr. Davis said that since the finalisation of the report, all that had been made public was the change to the Fringe Benefits Tax (FBT) for vehicle leases.

“This will hit the hip pockets of nurses, paramedics, allied health professionals, aged care staff and community health workers who will lose their salary packaging benefits.” Mr. Davis said.

“This Federal Labor Government saving is a direct hit to the health, not-for-profit and community service sectors.”

“The most damning thing is that the Federal Labor Government move is not targeting high income earners.”

“This move threatens the workforce stability and security of the health, not-for-profit and community service sectors, creating a perverse incentive for the workforce to seek higher paid jobs elsewhere.” Mr. Davis said.


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