Outcry over tax on rain

THE Bracks Government is outraged at a leaked federal proposal to tax rainwater collected from roofs.

The idea was revealed in a leaked email seen by the Sunday Herald Sun.

Acting Premier John Thwaites yesterday warned that if water was privatised -- as proposed by some federal Liberals -- a tax on rainwater in tanks would follow.

The Bracks Government is furious at the mooted tax -- it pays rebates on tanks as a water conservation measure.

In the email, National Water Commission chief Ken Matthews says, "Legally, all water in Australia is vested in governments."

Mr Matthews' email continued: "Governments have not yet considered the capture of water from roofs in rainwater tanks to be of sufficient magnitude to warrant the issuing of specific entitlements to use this class of water.

"However, if rainwater tanks were to be adopted on a large scale such that their existence impacts significantly on the integrated water cycle, consideration could be given to setting an entitlement regime for this class of water."

Such a regime already exists for farmers catching rainwater and storing it in dams.

A residential household version could include a licensing arrangement and taxes for those wanting to collect more than a set amount.

The commission yesterday confirmed the email was accurate.

Mr Thwaites said there were also fears the Federal Government could seize control of the resource from the states and tax rainwater.

And Federal water parliamentary secretary Malcolm Turnbull has said that if the Australian constitution were drawn today, control of water would be given to Canberra.

Prime Minister John Howard's environment parliamentary secretary, Greg Hunt, also has talked up water privatisation.

Mr Thwaites said yesterday the Bracks Government opposed any taxes on rainwater.

"We want people to use rainwater to take pressure off Melbourne's storages," he said.

"We are encouraging people to install rainwater tanks and that's why we offer a rebate of up to $1000 on them.

"Greg Hunt is saying private companies should take over recycled water.

"If private companies were allowed to take over water they would seek to maximise profits at the expense of the public.

"Private companies would not want the competition from water tanks and would therefore seek to control tank water or have it taxed."

Mr Howard said in his New Year message water had to be looked at from a "national perspective".

And Mr Hunt has signalled a plan to force states to recycle more waste water or allow private firms access to it.

Mr Matthews said in his email: "It is important to think of the capture of water from any source in an integrated way.

"If 1000 homes were to install 5000-litre tanks with an annual yield of 57,000 litres, this is 57 million litres that would not have reached a river or ground water system, or -- viewed another way -- is taken from either the environment's entitlement or another productive use."