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Tuesday, 18 June 1996
Page: 2108


Mr LATHAM(6.20 p.m.) —The Prime Minister, the member for Bennelong (Mr Howard) has always said that he wants to establish a relationship of trust with the Australian people. He has said that he wants to establish a bond whereby the Australian people can rely on his words and his promises. This customs bill and scores of other broken promises have shattered that trust. This bill and scores of other broken promises have shattered that bond. This bill is another broken tax promise. It is a three per cent tax on consumers. We know it is a tax because the Minister for Industry, Science and Tourism (Mr Moore) has said so. In the Sydney Morning Herald on 2 April Mr Moore conceded that it was totally correct to say the removal of tariff concession orders was an extra tax. There it is from the minister's mouth that this is a tax. That ends once and for all any question as to the status of this particular measure.

As a tax, it is completely contrary to the coalition's tax promise. They were the party prior to the election that would never introduce a new tax. They would not change the tax mix; they would not increase any tax. But barely 100 days into the Howard government we have a broken tax promise before the parliament which will place a three per cent tax on consumers. All those valuable items in the households, in the pubs and clubs and on the sporting fields of Australia are to be levied with an additional three per cent tax. This government has decided, contrary to its election promise and what the former government was intending, to place a three per cent tax on consumer goods imported to Australia where similar goods are not produced within this country.

The government is, in this debate, again trying to construct its alibi for a breach of faith with the Australian people, an alibi by which a broken promise can be justified. Of course, the coalition always alludes to the fiscal position. But we know too well that this is the standard tory method in Australia for breaking promises. It was patented by Nick Greiner in New South Wales in 1988 and was then tried on in Victoria, Western Australia and South Australia. It is the standard message from the conservatives, who make promises only to break them. They come into government and say that the cupboards are bare.

Tomorrow, we are having the report of the Commission of Audit. It will be bodgied up to try to legitimise things, to try to create the alibi by which this coalition government can break its promises. But the truth has come out: when the member for Higgins, the Treasurer (Mr Costello), made the allegation on 12 March, he said that the parameters had changed and that the problem was that the forecasted growth had slowed. The problem has now been corrected by the March quarter national accounts and, apparently, growth is going gang-busters. Even the Prime Minister has acknowledged as much in a very open account to the international bankers when he said that the Australian economy was in good shape. Let me quote from that conference in Sydney on 3 June. The member for Bennelong had this to say:

The incoming Government inherited an Australian economy . . . that was a little better than just good in parts . . . We have had 19 quarters of positive economic growth . . . low levels of inflation, and we continue to enjoy the benefits . . .

The Australian people are quite entitled to ask this basic question: if things are so good and the Australian economy is in such good shape, why do the cuts need to be so big? If the Australian economy is in such good shape, why do tax promises need to be broken, and why does the parliament need to consider this new three per cent tax on consumers?

The government is seeking an alibi, an alibi that the Prime Minister has blown with his admission that things are in good shape. There is no reason to break the government's tax promises. We are now to believe that the five minutes of economic sunshine that the Prime Minister spoke of in 1995 have turned into the year's longest day of economic growth, the longest growth cycle in the nation's modern history. We have also had an understanding in recent times of the $3 billion hole that the coalition has dug for itself with its uncosted election promises. So much for transparency on the budget! The government will not release the Department of Finance costings on the $3 billion worth of coalition election commitments made prior to 2 March.

The other interesting thing in relation to the fiscal position is that the coalition itself, throughout the course of 1995, became the poachers in the Senate, knocking $2.3 billion of revenue off the Commonwealth budget. The poachers, of course, have come into this House and said that they are the gamekeepers. But the gamekeepers are the ones trying to bodgie up an alibi by which they can break their promises to the Australian people. It was the member for Bennelong, supported by the member for Higgins, who throughout the election campaign chanted across the nation their mantra of no new taxes and no tax increases. They did everything within their power to chant that mantra—everything, bar asking the Australian people to read their lips.

Indeed, at the Press Club before the election, the member for Higgins said, `It is not our agenda to introduce new taxes. It is not our agenda to bulk up currently existing taxes.' Bulk up? He is a tax hulk, breaking out of his suit with enthusiasm to tax the Australian people. This legislation reveals very starkly one fundamental truth in Australian politics, and that is this: how can anyone take the coalition's mandate seriously, if the coalition does not itself respect it?

If the coalition does not respect its own mandate, its own solemn promise to the Australian people, not to introduce new taxes, such as the one contained in this legislation, how can the Australian people and this parliament respect it when it comes to provisions like the privatisation of Telstra and the labour market deregulation bill? The coalition has always claimed a mandate on those issues, but it has no mandate on any issue unless it is prepared to respect its own promises. It is an absolute act of disrespect to the parliament, to the Australian people, to all the businesses and to all the taxpayers, to introduce this legislation into the House of Representatives.

What we are seeing is broken promise after broken promise. It was very interesting, in relation to this question, to recall the words of the Prime Minister on the John Laws program just before the election. He was asked, `If you were given a choice between keeping all your promises and running down the budget or breaking promises and bringing the budget back into surplus, what would you choose?' The Prime Minister said very clearly that, given that choice, he would keep his promises at any cost to the budget. That proves one basic thing: you cannot trust the Prime Minister on his promise to keep his promises. That is how bad it is. He is breaking his promise to keep his promise on no new taxes. This is a three per cent consumption tax that is being levied across most of the sectors in Australia.

After the election, the Prime Minister said on the John Laws program, `I am desperate to be an honest man.' That is what he said: he is desperate to be an honest man. He can't be too desperate this evening, because as consumers throughout the country pay their three per cent impost they will not think that the Prime Minister is desperate at all; and they certainly will not think that he is honest. They will think that he is a sneak, a welsher, a promise breaker, someone who made all those election promises for one purpose and one purpose only; that is, he made them to be broken. When he put his hand on his heart and said to the Australian people, `There will be no new taxes under a Howard administration,' he made that promise only to break it.

One needs only to recall the debate in the House earlier. The member for Hotham (Mr Crean) accurately described this tax as a mystery tax. So much for respect for the parliament ahead of the executive. The parliament does not even have an indication as to which items this tax will be levied on. There is one report in the media that 17,000 consumer items throughout Australia are to be affected by this legislation.

The Minister for Industry, Science and Tourism responded to the suggestion of a mystery tax by saying that it is actually a mystery ball, like the Shane Warne ad, where they bowl the mystery ball and it darts through the hotels and the houses and across the sporting arenas of Australia and comes back and bowls Ian Botham. I can appreciate why the minister for industry was saying that it was a mystery ball, because his own delivery on this has bowled the Treasurer middle stump. He has rolled the Treasurer on this measure right through the cabinet process, and bowled him middle stump. He joins a long list of state and territory leaders who have been doing that in recent times. For the poor old Treasurer, it is duck after duck after duck as the middle stump is knocked back.

It is all well and good for the minister for industry to joke about this being the mystery ball that he has bowled to the Treasurer, but I think the comparison runs a bit closer to the bone. In that cricketing commercial the mystery ball starts out by going through the houses of Australia. It is very interesting to note that the mystery tax will be doing exactly the same thing. The mystery tax will be going through the houses—through the windows, through the doors—placing a three per cent consumption tax on all household items. It is a tax on baby walkers, battery operated dolls, bone china goods, can openers, candlesticks, coffee grinders, dolls' shoes, dolls' strollers, food blenders, microwave ovens, electric trains, food processors, knives, lint removers, men's and women's shavers, quilts, rice cookers, squeaky toys, toy music boxes, toy vehicles, toy washing machines, vacuum cleaners, video games and yoghurt makers. They are the sorts of items which will qualify under this three per cent consumption tax; they are the sorts of items that will be affected.

Where does the mystery tax turn to after that? It crosses the sporting and playing fields of the nation. As it does there is a three per cent tax on baseball equipment, basketballs, bicycles, electronic dart boards, exercise cycles, golf club grips, golf club practising machines, gymnastic equipment, ice hockey skates, javelins, discuses, knee guards. All these items are subjected to a three per cent mystery tax. It covers pogo sticks, pool toys, skateboards, skipping ropes, soccer balls, softball bats, table tennis balls. The list goes on. All these basic consumer items used on the playing fields of Australia go up by three per cent.

I know what the impact will be, because the mystery tax will be crossing the electorate of Werriwa. There is no more important activity in the south-west of Sydney than what happens on the playing fields of Campbelltown and Liverpool. All the families who participate in and love their weekend sport will be affected adversely by this three per cent consumption tax. So the mystery tax will be passing across household items, across the sporting fields and across the sporting arenas.


Mr O'Keefe —All taxes are going up, up, up!


Mr LATHAM —As the member for Burke points out, taxes are going up, up, up under this high taxing government with its three per cent consumption tax. Where will the mystery tax turn next? It is just like the mystery ball. It will pass through the pubs and clubs of Australia, smashing its way through as it levies its three per cent impost. The price of billiard balls will go up by three per cent, as will the price of billiard cues, coin-operated pinball machines, dart flights, dice, steel guitars, synthesisers, and even Christmas decorations. That is how low this government has gone.


Mr O'Keefe —Christmas decorations!


Mr LATHAM —Yes, even the Christmas decorations will be taxed. Not only in the pubs and sporting clubs but also in the households of Australia, the price of imported Christmas decorations will go up by three per cent under this government, yet it promised no new taxes. `No new taxes' was the Prime Minister's promise to the Australian people at the 2 March election. This legislation goes out of its way to hurt Australian families. This is the legislation that the coalition said it would never introduce to this House. This is evidence that under this government it has become a dog's life for Australian taxpayers and consumers. It has become a dog's life for all Australians affected by this high taxing government.

It is often said—and it is a bit of a cliche—that you cannot teach an old dog new tricks. That is not what they are saying at the Treasury these days. They have been teaching their old dog plenty of new tricks: new tricks like a $1.2 billion GST on the states; new tricks like a consumption tax on the Australian public, as contained in this particular legislation. Speaking of dogs, it is worth quoting what the member for Higgins said on 30 January:

Here is the big difference between us and the government: Mr Willis wants to increase taxes. We don't. That is the big difference between us.

This was not a promise that was sundry to the election campaign. This was not a promise which was a matter of trivia in the public debate. This was a promise that the Treasurer was willing to stake his reputation on during the election campaign. This was a promise not to introduce taxes, not to change the tax rates, a promise upon which Peter Costello was willing to stake his reputation. He made this the defining issue of the 1996 federal campaign. He said that the big difference between Labor and the coalition was that Labor allegedly wanted to increase taxes and the coalition did not.

On that defining issue, on the issue on which the Treasurer has staked his reputation, he stands condemned by this House. He stands condemned for misleading the Australian people on tax policy. They are suffering from tax fraud. They are suffering from the tax grabs of this government. This legislation is only part of the pattern of higher taxes under this Howard-Fischer government.

For a government that said at the election that it would not introduce taxes, what have the Australian people had to face? They have had to face an increase in the Medicare levy, a $70 per annum impost on taxpayers—a one-off $500 million tax increase for the coming financial year. Beyond that, they are now facing the prospect of the state Costello taxes. We know they are Costello taxes because Jeff Kennett said he would name his state taxes after his dog, so they are state Costello taxes. That amounts to a $650 million tax grab that will hit the average taxpayer in Australia by $150 per annum. That is a $150 per annum tax grab that the government said would never happen. It promised that these things would not be placed before the parliament at state or federal level.

The impact is severe. The price of beer is going up. Cigarette prices are going up. There will be levies. People in Victoria are now talking about Peter's poll tax as they face the prospect of a land levy to pay for the way in which the Treasurer abused the Premiers Conference process. Beyond that, the Treasurer did not get what he wanted. He really wanted a $1.2 billion GST on the states. So there is an increase in the Medicare levy and there is the state Costello taxes.

Small business and self-funded retirees have also been affected because they have been swindled on the uplift factor on provisional tax. The coalition promised six per cent but they have legislated a permanent rate of 10 per cent, which is now before the Senate. That is a $540 million tax diddle. It is a $540 million tax grab over the three years of this parliament.

Beyond that, the Treasurer thinks he has got away with imposing a sales tax on government cars—something that will cripple the car industry in Australia. It is a tax grab of $100 million per annum. There have been those four clear areas of broken promises relating to tax. Now there is a fifth, the measure which stands before the House—that is, a tax grab of $500 million per annum.

How do the Australian people come to understand the tax scorecard of the Howard-Fischer government? How does that scorecard stand tonight, after barely 100 days of this administration? It is the Medicare levy, $500 million; the state Costello taxes, $2,000 million throughout the life of this parliament; the uplift factor on provisional tax, $540 million throughout the life of this parliament; the tax on cars, $300 million. This bill is a startling $1.5 billion over the next three years. The total tax scorecard for the Howard-Fischer government is a startling $5 billion throughout the life of this parliament. For each taxpayer in Australia that equals $625 over the next three years or $210 per annum.

That is the bottom line for all those battlers, all those families, all those taxpayers who put faith and trust in the member for Bennelong, who is now the Prime Minister. The bottom line, barely 100 days into his administration, is they are $210 per annum worse off, including the measures in this bill, than when this government started on 2 March. It is all before this government gets serious with its August budget. It is all before it even gets into the serious debate it wants to have on the GST.

Not so long ago, on 2 May, the Treasurer said in this House: `I must say, there is a lot of economic sense in a GST.' So he is keen, as the coalition has always been keen, on the idea of a goods and services tax. Just this morning, in the national press, in the Sydney Morning Herald there was an article headed `Howard keen to encourage debate on GST'.

So Australian taxpayers are $210 per annum worse off under this government, under the five broken promises on tax that we have seen already. This is before they have even warmed up, before these National Party gentlemen opposite even get keen on tax. This is a big taxing government that has made the average Australian taxpayer $210 worse off per annum after barely 100 days, and the GST is still to come. (Time expired)