How the State Government’s decision on ride sharing can be dramatically improved
In relation to the recent State Personalised Transport Review, CCIQ’s overarching position was that we supported competition in the market and the entry of alternatives such as Uber.
However, that competition needed to be fair and on an even playing field.
In our view, we are not yet there – despite the State Government’s commendable solution to this issue.
CCIQ believes the State Government has reacted with balance in finding a compromise for the personalised transport industry but more needs to be done.
Under the changes announced by the State Government from today:
• Ride-booking services will be legal for drivers holding a valid driver authorisation and safety inspected vehicle;
• 80 taxi regulations will be cut, and the taxi industry will benefit from $4.3 million in waived fees over the next 12 months; and
• The Queensland Government will establish a $100 million transitional assistance package to help taxi and limousine licence holders adjust to more competition and take advantage of new opportunities – without a fare levy.
Key elements of the $100 million transition assistance package include:
• $60 million via a one-off payment of up to $40,000 for existing taxi licence holders ($20,000 per licence, capped at two licences) and $10,000 per licence for existing limousine licence holders
• $26.7 million hardship fund
• $4.3 million in waived fees
• $5.6 million to incentivise wheelchair accessible taxis
• $3.75 million for business advisory help
According to a PwC economic analysis, the changes are estimated to deliver a net economic benefit estimated at $474.1 million across the state.
However the competition will continue to remain unfair. Quite simply it is all about tax and it is questionable whether Uber is paying their share in Australia.
Read the Australian Senate’s Economics References Committee report on corporate tax avoidance from November 2015:
In short approximately 25 per cent of the revenue that they earn in Queensland is not taxed.
And quite rightly most of our members feel aggrieved by tax minimisation or companies actively seeking to ‘game’ the tax system.
Queensland businesses are overwhelmingly in agreement that more needs to be done to address multinational companies moving profits overseas to avoid paying taxes in Australia.
According to a CCIQ ReachTEL Survey conducted last year 90 per cent of Queensland businesses agree or strongly agree that tax avoidance undermines the fairness and integrity of the tax system.
CCIQ believes multinational companies such as Uber that are able to structure their operations to avoid the full scope of taxes have an unfair advantage, particularly over small and medium businesses that only operate locally and do not have financial capacity to implement such intricate tax planning arrangements.
This situation undermines the integrity of our tax system and prevents local businesses from competing on a level playing field.
On this basis CCIQ favors the State Government including in the annual driver authorisation license the inclusion of a tax equivalent payment/levy for non-taxi plate holders (Uber, GoCatch).
GoCatch CEO David Holmes (above)
This would be in lieu of the tax that any reasonable small business person would expect a multinational to pay.
This would truly create a level playing field.
CCIQ would vocally support the State Government on this position and we believe it could market this point significantly.
Because at the moment that $100 million assistance package is coming out of the State Budget of which Queensland businesses contribute 65 cents in every dollar earned.
If Uber and GoCatch want to join the market then they should pay their fair share of tax to the State and Commonwealth.
The Personalised Transport Horizon package strikes a balance between ensuring existing industries are not unfairly sidelined, but also allows for market disrupters to flourish in Queensland’s economy but at its core fair competition to our mind includes tax.