More than 100 Building Tasmania workers had their redundancies wrongly treated as tax-free and Labor says workers who left over the past 13 years could be caught up too.
Labor wants the government to reveal how far back the errors go and how many former public servants could face unexpected tax bills.
“We don’t know how far back this problem goes,” Labor MP Ella Haddad said.
Haddad blamed the errors on the speed of the government’s public sector cuts, which aim to reduce the workforce by 1,700 jobs.
“Eric Abetz is the most reckless treasurer Tasmania has ever seen,” she said.
“In his rush to get rid of people, he has got the tax law so terribly wrong that people are going to be facing tax bills that come out of nowhere.”
She said Premier Jeremy Rockliff and Treasurer Eric Abetz need to be clear with the workforce and the public about how far back the mistake stretches.
“How many people who have left on redundancies over the last 13 years could now be facing a tax bill that they were not expecting?” Haddad said.
“Minister Ellis is on the record saying this has been historical practice.”
“How on earth have they got this so badly wrong for so long?” she said.
She said the government did the right thing by reporting the error to the Australian Taxation Office (ATO), but it could still face fines.
“The ATO isn’t in the habit of looking the other way when people make big mistakes like this,” she said.
“This government’s been in power for 13 years,” she said.
A government spokesperson said it is a legacy issue that includes the former Giddings Labor-Green government.
“The issue has been identified and we have ensured that public servants accepting voluntary redundancies have the same post tax outcome as expected,” the spokesperson said.
Asked whether past governments, including the former Labor-Greens government, also bore responsibility, Haddad said “every government should obey the law and this government’s been in power for 13 years”.
