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Thursday, 15 September 2011
Page: 10333

Taxation


Mr OAKESHOTT (Lyne) (14:34): My question is to the Prime Minister. Prime Minister, with 10 taxes in Australia raising 90 per cent of tax revenue and in your considerations leading into the national tax forum in October, will your government commit to fewer taxes for a simpler and more resilient tax and transfer system in Australia—

Mr Dutton interjecting

The SPEAKER: Order! The member for Dickson! I have the opportunity of inviting the member for Lyne to commence again, but I will not. He will now be heard in silence.

Mr OAKESHOTT: as well as committing to a process with the state governments that starts reducing the 115 inefficient taxes, mainly state taxes, as identified in the Australian tax review of 2009?




Ms GILLARD (LalorPrime Minister) (14:35): I thank the member for Lyne for his question. It enables me to talk to the House about the future tax forum and tax reform generally. First, it is very important to ensure the House has the facts at its fingertips. The Howard government was the highest taxing government in Australia's history. I know that members of the opposition are in denial about this very simple fact.

Opposition members interjecting

The SPEAKER: Order! I hope the member for Lyne does not take this the wrong way, but he is up in the backblocks. If I cannot hear the response, I would be very surprised if he can. I think that the House could just settle down or we will be here all day listening to me lecture you. The Prime Minister has the call and should be heard in relative silence.

Ms GILLARD: I am trying to share a few simple facts with the House. Under the former Howard government, tax as a share of GDP reached 24.1 per cent—

Ms Marino interjecting

The SPEAKER: Order! The member for Forrest is warned!

Ms GILLARD: in 2004-05 and 2005-06.

Mr Hockey interjecting

The SPEAKER: The member for North Sydney is warned.

Ms GILLARD: That is a fact—24.1 per cent, making the Howard government the highest taxing government in Australia's history.

Mr Tony Smith interjecting

The SPEAKER: The member for Casey is warned.

Ms GILLARD: Tax as a share of GDP inherited by this government was 23.5 per cent—that is, it had come down from the Howard government's peak as the highest taxing government in the nation's history. For 2011-12, tax as a percentage of GDP will be 21.8 per cent. Importantly, that is less than the tax share—

Mr Pyne: Mr Speaker, on a point of order: under the ruling you made yesterday the opposition has responded to that by making sure that its questions do not contain argument. The government, on the other hand, has not responded to your indication about how you will view question time because it is still using questions as an opportunity to slag the opposition. I would ask you to bring the Prime Minister to order under the ruling you made yesterday.

The SPEAKER: The Prime Minister has the call. If I am being invited to listen more carefully to her response, if I am able to hear it through people stopping interjecting, I will listen more carefully. But until now the Prime Minister has been in order in responding to the question from the member for Lyne.

Ms GILLARD: I was asked about tax and the tax forum coming up in a few weeks time. I was creating the baseline fact that I think people need to know that tax as a share of GDP is less now than when this government was first elected in 2007 and certainly less than the highest taxing peak under the Howard government, as the highest taxing government in the nation's history.

I am asked by the member for Lyne about the efficiency of taxes. On the question of the efficiency of taxes, the government has been engaged in a tax reform agenda, including the tax reform agenda associated with lifting the tax-free threshold, which takes one million Australians out of the tax system. The member for Lyne has also directed my attention to the inefficiency of state taxes—the number of them and the inefficiency of them.

The SPEAKER: The member for North Sydney might as well sit down. The Prime Minister will resume her seat. The member for North Sydney will resume his seat.

Mr Adams interjecting

The SPEAKER: The member for Lyons is warned. I really would like to know what the point of order of the Manager of Opposition Business was if it was not anything but the way in which the question was to be responded in a directly relevant manner. The only standing order that I have before me to use as the basis for a response is that they shall be directly relevant and it is open to me to interpret that. The point that the member for Sturt was making to me was about my interpretation of 'directly relevant'. I say again that this could be solved if we had the same rules for questions and answers. What I have tried to say, as is alluded to in Practice, is that it seems wrong that the same standard is not applied to responses. That is where I am trying to get to. The original point of order had to be under direct relevance. That is why I was not inclined to give the member for North Sydney the call, because I know that he knows that there can only be one point of order under direct relevance. I have said I will listen carefully to the response. There may be a learning curve in what we are trying to change here, but I will listen to the Prime Minister's response.

Ms GILLARD: I was asked by the member about inefficient state taxes and I am responding directly to that. The member raises this question and he is right to do so. It was the subject of a great deal of attention under the Henry tax review. Self-evidently, state taxes are a state responsibility, but I will certainly be encouraging participants at the tax forum, including representatives of state governments to bring proposals for fewer taxes.

Opposition members interjecting

The SPEAKER: I remind the member for North Sydney of his status.

Ms GILLARD: I will certainly be encouraging that because the efficiency of our tax system is very important to the Australian nation and, as past tax studies, including the Henry tax review, have shown, there is a large number of inefficient state taxes; so, of course, it would be desirable for our economy for state governments to address this question and to have fewer taxes.

Mr Pyne interjecting

The SPEAKER: The member for Sturt is warned.