Senator BOSWELL (8:42 PM) —We are getting near the end of the road in this debate on the legislation for a new tax system and the goods and services tax. This package was taken to the election. It was soundly debated out there. People voted on it. No-one can say that the population were not aware of the new tax system that was offered by this government. An election was won on it. We proceeded back to parliament. Three Senate committees were set up and those committees have travelled extensively around Australia at great expense, carting around with them Hansard reporters and various senators. No-one has moved their position one iota. Now we are back to the debate. If no more speakers are added to the list, we will probably be concluding the second reading stage shortly.

One just has to wonder what we have achieved when we asked the electorate to endorse the tax package. The conservative coalition had some momentum up. They had a vision for Australia. They showed quite conclusively to the acceptance of the community, the electorate, that they had momentum up, that they had a vision and that they had a plan for Australia. On the other hand, the Labor Party went to the election full of negativism, with no plan for the future and no drive. Consequently, they were rejected.

Tonight we face a new tax system that I believe will make the economy work better. It is certainly going to be better for the constituents in rural and regional Australia. Not only will those people get the benefits, but Australian business enterprises will also get many benefits. The benefits will be felt right across Australia, right across the community, but it will be more beneficial, I believe, for rural Australia and small business.

I have been going around Australia in the last couple of weeks on the market domination inquiry. We have heard from just about every food retailer, processor and wholesaler from the big end of town like Coles, Woolworths and Davids to the absolute other end such as the small tobacco retailers and the small family corner stores. Right across Australia the message is universal: `Please do not exempt food from the GST. You will drive us to the point where we will not be able to run our businesses.' That is not coming from one sector of the food retail outlets or the food wholesalers or the processors but from right across the whole broad band.

Senator Mark Bishop interjecting—

Senator BOSWELL —No, they do not. No, that is quite incorrect. Food retailers want and are asking for a sales tax system that will not drive them crazy, where they have 22 per cent on this and 32 per cent on that and 10 per cent on something else and nothing on something else. They are adamant that they want this tax system up and running. I will tell you another reason why they want the tax system up and running: there is a problem with sales tax at the retail level which—

Senator O'Chee —Advantages the big fellas.

Senator BOSWELL —It certainly advantages the big fellas to the tune of about $30,000 a year for a retailer who sells in the vicinity of $12,000 to $15,000 worth per week. The GST washes the penalty away from small business. That is another reason why the retail sector is demanding that this new tax system go ahead. But it is interesting to hear that only a couple of weeks ago Labor Premiers Carr, Beattie and Bacon came here and ticked off on the new tax system which was going to give them another $17 billion over four or five years. I do not have to tell senators on the other side how stressed health delivery services are and how stressed the hospital situation is. This money will be able to relieve that situation.

So that is $17 billion to the states. They have come down here and they have ticked it off but, because they want to stay on line with party policy and because there is some sort of unity between the state Labor parties and the federal Labor Party, they put out a mealy-mouthed statement which was read by Senator Mackay saying, `Really, we'll take the money and run but we're not going to give it our blessing.' They wanted the money, and they have got the money. The states need an extra stream of revenue and the new tax system is going to benefit all states and those people who use public hospitals and schools, police and all those services that states provide which are financially stressed and at cracking point. This is one way to ensure that there is going to be a new revenue stream that will deliver services back to the states.

But this new tax is also going to encourage investment in industries that contribute to the growth, employment and prosperity of Australia's rural industries, which provide export markets all over the world. I have continued to use this figure, but some 25,000 farmers are needed to feed and clothe Australia. The other 120,000 or 110,000, depending on how you count them, have to get their income from exports; and they realise that. Our exporters have invested time and capital to become world-class traders. They have gained efficiency and increased productivity. They have had great leaps forward in sectors like the sugar industry, the wine industry and the dairy industry, which exports $2 billion a year. The wine industry is also very successful. The sugar industry also exports $2 billion a year.

But those industries are continually being saddled and burdened with a cascading wholesale sales tax system. That system increases production costs and takes away Australia's competitive advantage. Wholesale sales tax compounds throughout the value adding and the production phase of exports, making them dearer and less competitive. Our overseas competitors do not have that burden at all. In fact, we are handicapping ourselves with a wholesale sales tax system. We are encouraging imports by making them cheaper and we are saddling our own home-grown product with a lot of wholesale sales tax.

Every $2 of revenue collected by tax comes from the wholesale sales tax on goods purchased by a business. Australian primary producers compete under a very indiscriminate, unfair tax at the moment. We have now changed all that. We have a comprehensive tax package which takes into account Australia's people and its exporters. It is now up to the Senate to give the exporters, the lifeblood of this nation, a fair tax regime that they deserve. The new tax system is going to wash out of the system $4.5 billion in savings to Australia's exporters with a fall in production and value adding costs of 3.5 per cent. That is going to make us more competitive in the market.

It is a dog-eat-dog competitive market out there when you are selling sugar, wheat or wine on world markets, many of them corrupted by people devaluing their currency or by banks and governments giving monetary support to growers. We have to compete in that and we have to accept it. As I pointed out, there are 100,000 farmers out there who depend totally on exports. We have to have a tax system that makes us competitive. When you give $4.5 million worth of savings to Australian exporters, that is going a long way to solving many problems.

There is going to be an additional reduction in costs for Australian firms competing with imported goods. Agricultural industries alone will have a reduced cost of $1.1 billion a year—and that makes the average farm business about $7,000 better off. I cannot understand why the Labor Party, the Democrats and the Greens want to deny rural Australia this export opportunity and also block billions of dollars worth of fuel rebates that try to make us competitive.

Australia's comprehensive disadvantage is distance. We have to move our produce many, many miles—probably through the equivalent of several European countries—to market. High transport costs and diesel excise impact heavily on final margins. Under the tax system we have been debating here today, business will pay less for petrol and diesel. It will not be a one-way street with exports going down to the wharves, making our exports more competitive, but a two-way street with food and farm machinery, tyres, batteries, et cetera, and all those commodities that are required to sustain country towns in regional and rural Australia benefiting because the back loading will be at a lot cheaper rate.

We are going to pay less for diesel and we are going to pay less for petrol. We will be able to claim an input tax credit on the GST payable on fuel used for business, saving around 7c a litre on what is paid by business and farmers at the moment. The excise payable on diesel used in heavy transport and rail will be reduced from around 43c a litre to 18c a litre—a huge saving. All other users of diesel, including marine business users, will qualify for a full credit of the diesel excise, taking the excise from 43c a litre to zero. Road transport costs will be down 6.7 per cent, rail costs will be down 3.8 per cent and water transport will be down 5.8 per cent.

Yet where have the Greens, the Democrats and the Labor Party been for the last three months? This evidence has been produced time and time again for all the committees. But there is none so blind as those who do not want to see, and the Democrats and the Labor Party just cannot get their minds around it.

I can offer a little bit of gratuitous advice to the Labor Party. My friend Senator Julian McGauran said today that we may go to an election on this. If we do, if the Prime Minister does care to take us down that course, you are going to be soundly thrashed because you have no vision and you are offering Australia nothing. All you are offering is the politics of negativity. The people rejected the politics of negativity last time, and they will reject it again at any time there is an election called. If I can offer you a bit of gratuitous advice, even if you are philosophically opposed to this: please, for your own good, take a dive. If you take a dive, you may hold enough of you together to come back to form a bit of an opposition.

There are remote area power users and fuel generators. I would include in that a number of Aboriginal communities which would not have electricity but would be generating their own power by diesel generator. There are still a few of them left in the bush, but mainly they are right out in the really remote areas of the Gulf. But those Aboriginal communities and those on the islands of the Torres Strait use diesel generators to supply their power. There is going to be a rebate for those particular diesel generator users, and more users are going to qualify for that particular rebate.

So many more industries are going to benefit from a reduction in the fuel excise. Just take the charter boats out of Mackay, Townsville and Cairns for the tourist industry as an example. They are going to gain from the inclusion of marine activities in the diesel excise rebates. It is going to make a huge difference to the tourism industry around the Barrier Reef, particularly between the months of March to October. Many Asian people come over and take advantage of the tourist benefits and go out and see the reef. It is going to make that particular industry much more accessible and much more profitable.

Rural and regional Australia will benefit enormously from lower production costs and cheaper fuel. Sometimes I think I have fallen through the looking glass, like Alice in Wonderland, when I hear Senator Brown saying that we have to increase the diesel fuel excise on farmers. I would just love every farmer to come and sit in these galleries and listen to Senator Brown and Senator Murray, although Senator Murray, on occasions, does make sense.

Senator O'Chee —Not on this issue!

Senator BOSWELL —On occasions, I said. I do not want to give him too many accolades, but on occasion he has been known to make a little sense, but certainly not on the GST. Senator Murray would have to accept that he has been with me on this market domination committee. We have gone right around Australia, and he has been with us most of the time. He would have to acknowledge that the whole of the food industry have pleaded with the committee on this—although we have not really let it get up to run because it is a market domination committee. They have sent out signals to the Democrats—and they know Senator Murray is a Democrat— saying, `Please do not exclude the GST on food or you will give us such a headache we will never be able to maintain our system.' But Senator Murray seems to think he knows better than them.

So many communities are going to gain. Small business, the engine room of Australian employment, will receive a three per cent saving on business cost as a result of the new tax system. Nine hundred thousand small businesses employ 50 per cent or more of Australia's work force, and they will benefit from improved cash flows, lower compliance costs and the removal of a raft of taxes. The quarterly payment arrangements for the GST will deliver a cash flow benefit because everyone will sit on their cash for another three months. That will reduce their overdrafts and that will be a benefit for businesses, too. People know that, if they have a good cash flow, that will be of assistance.

The maze of taxes imposed by state and federal governments on small business has been an owner-operator nightmare. Taxes to be abolished or replaced by the new tax system include the wholesale sales tax; the provisional tax; the provisional uplift tax factor; company tax instalments; stamp duty on business properties; conveyances; stamp duty on leases; stamp duties on cheques, bills of exchange and promissory notes; stamp duty on shares; the reportable payment system; stamp duties on credit arrangements, instalment purchase arrangements and rental arrangements; and stamp duty on mortgages—a whole raft of taxes will be relieved. These will all be replaced by one single tax. The tax burden on small business will be reduced by more than $10 billion each year after the financial year 2001-02, and there are many other benefits.

As I said, the committees have gone out to the far-flung areas of Australia. They have come back at great expense. We have gone to the election with this package. The Democrats, the Greens and the Labor Party have heard all this evidence that I have said in my speech today, but they have not been moved. (Time expired)