Australian Govt. plans new tax to pay for floods

Prime Minister Julia Gillard announced on Thursday the temporary tax would apply to Australians on above-average incomes from July and raise $1.8 billion to pay for massive destruction from weeks of flooding along the east coast that is continuing further sou

The Australian government has proposed a tax to partially recoup the more than five-billion Australian dollars ($5 billion) it expects to spend on rebuilding after major flooding.

Prime Minister Julia Gillard announced on Thursday the temporary tax would apply to Australians on above-average incomes from July and raise $1.8 billion to pay for massive destruction from weeks of flooding along the east coast that is continuing further south.

But the new tax will need the support of independent lawmakers to become law when legislation is introduced to parliament next month. The main opposition party opposes it.

Initial estimates of the damage bill and cost of emergency grants to flood-affected communities for the federal government is AU$5.6 billion.