Senator CROSSIN —My question is to Senator Kemp, the Assistant Treasurer. Is the minister aware that a recent study by the New Zealand Inland Revenue Department found that, while the New Zealand tax system is somewhat efficient, one country that was better over the past few years was Australia? Is the minister aware that the New Zealand Commissioner of Inland Revenue told a parliamentary inquiry, `The GST is a little less cost efficient to gather,' and the current absence of a GST in Australia is the reason why this country has a more efficient tax collection system? Does the minister agree that collecting a GST would lead to increased deadweight cost to the economy and an increased collection cost for the Australian Taxation Office?

Senator KEMP (Assistant Treasurer) —Let me assure you that we intend to have a system which operates at world best practice.

Opposition senators interjecting—

The PRESIDENT —Order! There are too many interjections. Opposition senators shall cease interjecting to that extent.

Senator KEMP —As I was saying, when we get tax reform through the Senate, you can be assured that the system will operate at a highly efficient level. I am aware of the report that was brought down by the Commissioner of Taxation. I assure the Senate that the government intends Australia to operate the GST at world best practice, and it will compare favourably with the collection of other taxes.

The cost efficiency of the new system obviously needs to be assessed in the context of a whole package of measures. Of course, costs of collection will be affected by changes in state taxes and the streamlined and simplified payment and reporting arrangements for business taxpayers—of course, not just with the GST. As I said, we are very conscious of the need to develop a highly efficient and effective tax system, and those will be some of the key issues in the government's mind as it enters into negotiations with the Australian Democrats.

Senator CROSSIN —Madam President, I ask a supplementary question. Will the exemption of food from the GST increase or decrease the Australian Taxation Office GST collection costs, and what will be the benefits to the Australian economy from exempting food from the GST?

Senator KEMP (Assistant Treasurer) —Senator Crossin, like all her colleagues, will just have to wait till the government announces the outcome of negotiations.

Opposition senators interjecting—

Senator KEMP —Before I was shouted down, I was trying to indicate to Senator Crossin that, despite her sudden interest in matters of taxation, the Labor Party decided it would not be at the table in relation to tax reform so that is why she and her colleagues are on the outer. Senator Crossin, as to what eventually transpires, you will have to await the announcement of the outcome of negotiations we are having with the Australian Democrats.