Mr CREAN —My question is to the Treasurer. I refer to his previous answer on charities. Treasurer, isn't it the case that, under existing law, a charity buying a pie warmer today simply has to quote its sales tax exemption number to buy that pie warmer free of sales tax? Why did you just mislead this House?

Mr COSTELLO (Treasurer) —I would have thought that even to the Australian Labor Party, after debating this for some time—

Honourable members interjecting—

Mr SPEAKER —The member for Griffith! The Minister for Forestry and Conservation ! The member for Prospect!

Mrs Crosio interjecting—

Mr SPEAKER —If the member for Prospect is concerned about any action taken, she may raise it under the standing orders. She otherwise has an obligation to ensure that every other member is heard without interruption, as she well knows. The Treasurer has the call.

Mr COSTELLO —I would have thought that after all of this time the Labor Party would have become familiar with the concept of taxes embedded in prices and, just for the benefit of the Australian Labor Party, I restate the principle. A pie warmer is made by a machine on which there is wholesale sales tax. A pie warmer is transported on a truck on which there is wholesale sales tax. The truck is filled with petrol and diesel on which there is diesel excise.

Mr Crean —I rise on a point of order. It goes to relevance, Mr Speaker. The Treasurer, in his answer before, said the pie warmer attracted a sales tax. The existing law says it is—

Mr SPEAKER —The Deputy Leader of the Opposition will resume his seat. He has made his point. The answer being given by the Treasurer is entirely relevant to the question of whether or not there is a sales tax on the pie warmer or any other item, and I call him.

Mr COSTELLO —The manufacturer of the pie warmer, to cope with his wholesale sales tax, puts it into the price. The transporter with the truck, to cope with his wholesale sales tax, puts it into the transport. The diesel is added into the transport. The premises have taxable goods that go into them. The electricity that is used to warm the pie warmer has embedded wholesale sales tax. And under wholesale sales tax, the state-of-the-art Labor Party tax system, which is emulated in the world by only Botswana and Swaziland, no person can get back embedded taxes. I often wonder to myself how the Australian Labor Party sits there and thinks that, of all the political parties in the world, it is the only one that has seen the truth of wholesale sales tax.

Mr Beazley —Mr Speaker, I rise on a point of order. It goes to relevance. He was asked a specific question about an answer that he had given in which he said that sales tax which applies to the pie warmer is paid by the charity. We have quoted its exemption. Of course, what goes for the pie warmer goes for any item of equipment on which there is a sales tax charge—

Mr SPEAKER —The Leader of the Opposition has made his point. The Leader of the Opposition will resume his seat and I will rule on relevance. As I indicated earlier, the comments made by the Treasurer in response to this question were relevant. His criticism of previously existing policies is not as relevant. As I feel the latter part of his answer is not as relevant, I invite him to come back to the former response he was giving.

Mr COSTELLO —Mr Speaker, I have to talk about wholesale sales tax to answer the question because the question is about wholesale sales tax and how it affects prices.

Mr SPEAKER —It was not the comments about the wholesale sales tax that prompted the point of relevance.

Mr COSTELLO —For anybody in business or in charity or in export, under the embedded wholesale sales tax system you do not have any chance to get back taxes on your inputs—none whatsoever. Every other country in the world is giving their exporters a free go because you get back all the taxes on your inputs. Every other country in the world is giving their manufacturers a fair go because they can get back all of the taxes embedded in their inputs. This would be the only country in the world that is standing back and not doing it. It is about time we gave them the opportunity to do it.

Mr O'Keefe —Mr Speaker, I rise on a point of order which also goes to relevance. There are large groups in the community who have sales tax exemptions. The Treasurer is failing to answer the question.

Mr SPEAKER —The member for Burke will resume his seat. He is now advancing an argument. The Treasurer has concluded his reply.