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Tuesday, 29 June 1999
Page: 7767


Mr ANDREN (6:10 PM) —The goods and service tax and accompanying amendments to the taxation system are sitting in wet cement. Whether that cement sets and in what shape it sets time will show—and the distorted shape and cracks are yet to show, but they will. I have made my position clear over many months: the goods and service tax is a regressive tax that favours the well-off at the expense of those caught like a rabbit in the glare of the tax office headlights—nowhere to go to avoid, no discretion. The big tax avoiders, the friends of big government, are laughing. The heat is off. I think I heard the Treasurer today say that tax reform has been completed. Labor cannot cry crocodile tears for lower income earners either. Where was their attack on tax avoidance?

It is a bottom up not top down tax. It gives the greatest benefit to those on higher incomes when a fair progressive system should take more from those who have to provide services which give those who don't the chance to improve their situation. The former Taxation Commissioner Trevor Boucher says there is $21 billion worth of avoided tax and shelters out there that should and could be raided long before the imposition of an unfair tax on those who cannot avoid it. Not only that, but the further you go down the tax scale the less is the impact of tax cuts and the more every dollar spent attracts this tax. The compensations cannot be guaranteed; the GST can.

The Prime Minister suggests the only route to tax reform is a GST—that is absolute rubbish and the broader tax base we need is one based on greater income tax revenue, not consumption. The government has marketed the proposed changes as a new tax system for a new millennium, but the reality is the package is little more than an old fashioned, regressive, bureaucratic GST—nothing more, nothing less. Take the GST out of the package and the whole thing falls down like a pack of cards.

Some of the concessions granted to the Democrats were funded by reduction in income tax rates to higher earners. But those taxes in the first place are funded not from the GST, which goes to the states—and heaven help local government under that new funding regime. The tax cuts were funded through cutbacks to the states—funnily enough, cuts in university funding, labour market programs, legal aid and programs like the dental scheme. Incentives have been offered to the regional transport industry and farmers and to rail transport only after it was squeezed from them by the Democrats—the sorts of reforms that could and should have been funded by taxation gathered from areas identified by Mr Boucher.

I took a platform of opposing this tax to the last election and I claim a mandate from my electorate for that opposition. I totally reject this regressive, outdated, unfair tax for all of those reasons.