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Friday, 28 June 1996
Page: 3162


Mr CREAN(1.33 p.m.) —We welcome the government's indication that they will accede to these new amendments to the Customs Tariff Amendment Bill. These amendments build on the amendments which they accepted yesterday and now fully reflect the amendments we proposed in this House last Tuesday week to this legislation. Last week, they sought to introduce changes to the tariff concession orders that, amongst other things, would have seen the introduction of a new consumer tax on imports. Despite election pledges that there would be no new taxes, and against our opposition, they put through this parliament last week the introduction of a new consumer tax. That move was rejected by the Senate, which supported our amendment. We dealt with that matter yesterday.

In speaking to this matter yesterday, I indicated that there was still an issue that we felt needed further amendment. That was to ensure that the policy by-laws mechanism, the mechanism whereby business could still access a zero tariff rating, effectively would be expanded. It was proposed in the government's bill to introduce not just the three per cent tax on consumers but a new three per cent policy by-law rate. Under Labor, the policy by-law rate effectively enabled a zero rating. So we had not only the introduction of the consumer tax by stealth but also the closing off of an avenue to business to get some relief, some zero tariff rating.

Yesterday, we argued that the policy by-law rate should still stand at zero. The message that came back from the Senate yesterday was that the policy by-law zero rating applied to a number of categories but not all. Essentially, it applied simply to major projects. It did not apply to sections of the manufacturing industry that the Minister for Small Business and Consumer Affairs (Mr Prosser) has now just alluded to and to participants in the manufacturing industry in both small to medium sized enterprises. So we moved in the Senate that the policy by-law zero rating be extended to cover those manufacturing groups. I am pleased to say that the groups that are now picked up are machine tools for working advanced materials, raw materials and intermediate goods where the imported goods are given a performance advantage over the substitutable goods produced here and metal materials and goods in food packaging.

The effect of these amendments, as I said at the outset, is to implement the full extent of the opposition's second reading amendment to this bill last Tuesday. It is unfortunate that it has taken us until the last hours of this session of parliament to get this bill through since we gave the government the opportunity to amend it as far back as last Tuesday week.

The significance of this amendment is that it is not only a win for the opposition and a win for consumers and a further advantage to business but also a very significant and comprehensive win for the Minister for Industry, Science and Tourism (Mr Moore) over his Treasurer (Mr Costello).

One might recall that it was the minister who argued that the rates on business should be dropped. He succeeded in that. But what the Treasurer sought as the quid pro quo was the extension to consumers and the lifting of the policy by-law rate. These amendments effectively wipe out the quid pro quo. So the Peter Costello quid pro quo has been elimi nated by this step. It is a good piece of policy, we welcome the government's commitment to adopt it; consumers will be better off, and there are improved benefits for industry arising from it.

Question resolved in the affirmative.