The ‘Save the River Murray Levy’ will be abolished from 1 July, as the fund has achieved its original purpose, with the river now being supported by a national plan.
The abolishment of the levy will provide annual savings to most households and businesses of more than $40 and $182 respectively.
SA Premier, Jay Weatherill, said the levy was originally introduced in October 2003 to allow South Australia to lead the charge to save the River Murray and to fund a program of works and measures to improve the health of the River in the State.
“The State Government is abolishing the Save the River Murray Levy in recognition that the original purpose of the fund has been achieved, specifically, to allow us to campaign to save the health of the river,” Mr Weatherill said.
“The specific measures funded by the Save the River Murray Levy will continue to be delivered, but we now have a national plan to support and improve the health of the River.”
“We understand the cost of living pressures faced by South Australian households and want to look at ways in which we can ease that burden.
“We also want to reduce the cost of doing business in South Australia to encourage investment and help create jobs.”
The abolition of the levy, which will form part of the State Government’s tax reform package, would deliver savings to households and businesses of almost $109 million over four years.
The levy currently applies to the water bills of 415,000 households and 50,200 non-residential properties that are able to be supplied with River Murray water. Pensioners and low-income earners who receive a concession on their water rates are exempt from the levy.
SA Treasurer, Tom Koutsantonis, said the Save the River Murray Levy was considered a regressive tax in that it had a greater impact on lower-income households.
“The levy is a flat fee for all levy payers rather than a progressive fee based on property values, which is considered a better indicator of a person’s ability to pay,” he said. “As part of the State Tax Review, we looked at how we could make our State’s tax system fairer and more equitable.
“Abolishing a regressive tax like the Save the River Murray Levy is a prime example of this.”