29. Some Members have suggested that the rates relief scheme introduced on 1 April 1991 should be extended. This scheme was introduced as a temporary measure only. It has served its purpose. If it were extended for an additional year, less than 6% of domestic property ratepayers would benefit, and the cost to the revenue would be very high nearly $900 million for 1992-93.
30. I mentioned earlier the need to reduce our dependence on relatively volatile sources of revenue. One obvious way of doing this is to introduce a general sales tax. I should prefer not to introduce a new tax of this nature. I believe that my proposed moderate increase in general rates offers a stable and predictable alternative which would contribute nearly $6 billion in the period to 1996-97.
31. In addition to avoiding the need for a sales tax, the increase in rates has helped me to keep the increases in indirect taxes proposed in this Budget to very modest levels. I have been able to avoid any real increase in duties. Charges for water, postage and other government utilities, which are usually increased in the Budget package, will instead be adjusted during the year to minimise their impact on ordinary households. Departmental fees and charges, which were subject to a moratorium for nearly a year, will similarly be phased in carefully. Some Members have suggested that fees and charges should not increase at all. We could not afford this concession. A complete freeze on fees and charges would cost $24 billion in revenue foregone in the period to 1996-97.
CONCLUSION
32. I have said elsewhere, in response to some of the initial comments on the Budget, that if our financial position after this Budget continues to be as forecast, then in the 1993-94 Budget, it would be my intention to do what I can to alleviate the tax burden on the lower and middle income groups by reviewing and improving salaries tax allowances and bands. I made this statement, of course, on the understanding that all the revenue measures in the Budget are passed. Otherwise, our financial position could hardly be as forecast in the Budget.
33. A number of Members have asked me to be more specific. I have to tread a delicate line here. It would be irresponsible to make a completely unconditional statement. Clearly, we must have regard to any major changes in our present or prospective future financial position. We also need to give careful thought to where in the tax band concessions would be most helpful and equitable. And to the balance between improvements to the tax bands and increases in the allowances.
34.
At the same time, I would like to respond positively to Members on this, and to their clearly stated priorities, and to go further than in my earlier statement. I am now prepared to say this:
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