Mr FITZGIBBON (12:38 PM) —My respect for the member for Blair has just grown enormously. For him to be so brave, given that he has small wineries in his electorate, to come in here and say that the proposal to protect those small wineries represents nothing more than a bit of carping on the part of the opposition is just crazy. A brave man he is indeed to come in here all alone—I notice there are no comrades on the other side, and I notice the minister is here on duty but I did not hear any words of support—and express that view about the small end of the wine industry. That is very courageous indeed.

The opposition remains opposed to the regressive GST. We opposed it before the election. We promised the electorate that in government we would not follow the course of the present government and we promised the electorate that in opposition we would do all in our power to knock over a regressive tax—a tax, as the Senate inquiry has shown, which does nothing to boost the Australian economy but does lots to hit people for six—those people least able to afford the burden that that tax will impose upon them.

However, the arrangements this tax bill seeks to put in place will be necessary if the Senate passes the government's GST bills. On that basis, the opposition is not opposing them but, as has been mentioned by the member for Hotham, we will be proposing some amendments which seek to make the wine equalisation tax much fairer. In terms of the luxury car tax, the opposition will not be opposing that either, but it just goes to show what an untidy arrangement the goods and services tax will be if ever given effect.

The importance of the wine industry in Australia cannot be overstated. It now employs more than 60,000 Australians directly and, of course, many more indirectly. Most of those people are employed in the regions. In my own electorate of Hunter, the wine sector is one of the main industries which underpins the local economy. The wine industry is a significant export industry for this country. One billion dollars in wine is expected to be exported from this country next year, and the projections are that the export side of the industry will continue to grow at a rate of about 25 per cent per annum.

The GST bills provided the government with an excellent opportunity to revisit the issues of tax on wine—to have a debate about the impact of the taxation system on the industry, to have a debate about how it affects consumption decisions, to have a debate about how it affects investment in the industry, to have a debate about how it affects export growth, and to have a debate about how, if it all, it addresses the public health issues and social issues that flow from alcohol consumption. But what did we get? No real community consultation, no inquiry, no submissions invited. We got 368 words from the Treasurer during his second reading speech—368 words about a massive tax change in an industry crucial to this nation's economy; 368 words about an industry now exporting its head off.

There was no debate about price elasticities, no debate about import competition, no debate about public health, no debate about those social impacts of alcohol consumption which I mentioned earlier—just a measly 368 words from a Treasurer who, I admit, focused on the big issues but who has no concern whatsoever for an industry which is experiencing some exciting growth and, in particular, he has no concern at all for the smaller wineries which are going to be disadvantaged as a result of the government's decision to choose an ad valorem system. There was no concern at all expressed about the fact that the impost will be 29 per cent, even though the Wine Federation in Australia has demonstrated quite clearly that a tax of around 24½ per cent would have been sufficient to make this a revenue neutral proposal.

The debate over the relative merits of an ad valorem based wine equalisation tax and a volumetric based tax is one we should have had. We should have had it in this place and we should have had it in the wider community. There is no doubt that, relative to the big players, the smaller wineries are going to be disadvantaged by an ad valorem based wine equalisation tax.

I have already mentioned the fact that the member for Blair was quite brave to come in here all alone without qualification to support the WET, but I really have to ask myself: where is the member for McEwen? Where is the member for Ballarat? Where is the member for Eden-Monaro? Where indeed is the member for Forrest? There is a very interesting trend running through this parliament. Whenever we have a debate in this place on an issue on which the backbench is offering no support, it is reflected in the speakers list. It was reflected when we were debating the petroleum repeal bills and it is reflected again here today. Where are those members with small wineries in their electorates? On our side we have the member for Lyons on the speakers list—which is not unexpected—and I look forward to his contribution. We also have the member for Bass. Again, she is someone who represents a wine region very well.

Mr Hockey —What about the member for Barton?

Mr FITZGIBBON —The member for Barton does not mind a bit of regional wine I might add, but he does not represent a wine region. Yet from the other side we have had one speaker—I repeat, one speaker—from a wine region who was prepared to come in here to support a proposal which will disadvantage their local industry. The wine tourism industry is a major employer in this country, particularly in the regions. When people visit those regions—when they come to the Hunter or when they go to the Barossa, to Margaret River and to the Tamar Valley—they do so to visit the small wineries. They go there to experience the pleasure of wine tasting and all those other things those small wineries have to offer. Of course, while they are there they visit our restaurants, they take up accommodation and, generally speaking, spend lots of money.

I would have thought that the wine tourism industry was just so important to the regions that the government would have had it at the forefront of its mind when considering the form of the wine equalisation tax. More attention should have been given to the impact of the WET on those industries. We should have had, as I said, a full parliamentary inquiry. We should have given the smaller players an opportunity to appear and to put their case. They represent some 550 of the 1,000 wineries which traverse this country and they should have had an opportunity to be heard. It is not surprising that the big players like the Winemakers Federation of Australia have had their day—and the government has been very quick to jump on the ad valorem train—but those small wineries should have been given an opportunity.

I have to concede that, without that inquiry, the opposition is in no position to be advocating here today that we should shift to the volumetric system, but we should have had that opportunity. We are proposing amendments which, as the member for Hotham mentioned, will go a long, long way to compensating those small wineries that are going to be adversely affected by these changes. The amendments will do basically two things. The first will exempt from the wine equalisation tax all cellar door sales up to an amount of $100,000 of wholesale value each year, and the other will exempt from the wine equalisation tax all promotions and those wines given away at wine tasting.

The member for Hotham made a very important point. The wine equalisation tax is supposed to be about topping up the GST to ensure that, for those public health reasons and those social policy reasons, the price of wine does not fall. That is probably a reasonable community expectation. But how do you justify putting an equalisation tax on something that does not have a GST upon it—that is, wine tasting and promotions? There is no logic to that whatsoever. I can only assume and hope that it was a mistake in the drafting. I do appeal to those on the other side to at least support that part of our amendments today. This was a wine equalisation tax which was supposed to be revenue neutral: it is not. Not enough thought has been given to it. I appeal to members on the other side to support the opposition's amendments.