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Thursday, 25 June 1998
Page: 5430


Mr GARETH EVANS —My question is to the Treasurer and it follows immediately from the answer he has just given about the problems of people not knowing what tax rates are under a WST. Did the Treasurer say on Perth radio this morning that his GST would be `embedded in the price, just as a goods tax is embedded in the price'? Doesn't this mean that his GST, in exactly the same way as the present indirect taxes of which he has been so critical, will remain for consumers a hidden tax? Will he require that the GST content of a price be shown separately and clearly from the tax-free price so that consumers are fully aware of their GST liability? If he will not require that the GST content be shown separately and clearly, why not?


Mr COSTELLO (Treasurer) —Because, if you have broad-based indirect tax and you tell people that it is broad based and what the rate is, everybody knows what it is. That is the whole idea. But the advantage of a wholesale sales tax and the reason that the Labor Party wants it is that the Australian Labor Party wants to have differential rates on differential goods. The Australian Labor Party wants to ensure that caviar is tax free. The Australian Labor Party wants to tax biscuits at 12 per cent. The Australian Labor Party wants to tax Van Gogh at zero. The Australian Labor Party wants to tax children's painting sets at 22 per cent.


Mr Beazley —Mr Speaker—

Opposition members interjecting


Mr SPEAKER —Members of the opposition are making so much noise that we cannot hear whether or not their leader wishes to take a point of order. Do you wish to do so?


Mr Beazley —The point of order is on relevance, Mr Speaker. The Treasurer was asked a specific question as to the difference between his embedding—as he described it— and the current arrangement. He has answered the question and is now irrelevant.


Mr SPEAKER —The Treasurer can respond within the question frame.


Mr COSTELLO —The one thing you know with a broad based indirect tax is what the rate is.


Mr Crean —Until you put it up.


Mr COSTELLO —The member for Hotham talks about putting up rates. We remember 1993, when the Australian Labor Party went to the people of Australia and said, `Vote against indirect taxes.' The rate was then 10 per cent, and it went to 11 per cent. The 11 per cent went to 12 per cent. The 20 per cent went to 21. The 21 per cent went to 22 per cent. The 30 per cent went to 31 per cent.


Mr Beazley —My point of order goes to relevance, Mr Speaker. The question asked the difference between his embedding process and the process that applies to wholesale sales tax. He is now way off the point. He has already answered that question. He will conceal it.


Mr SPEAKER —There is no arguing of the question at this time. Within the framework, there is a capacity for the Treasurer to answer.

Mrs Crosio and Mr O'Connor interjecting—


Mr SPEAKER —I warn the member for Prospect and I warn the member for Corio.


Mr COSTELLO —You always know when the Leader of the Opposition is on weak ground because of the exaggerated laughter, as we just saw. The great thing about a broad based indirect tax is that you know it is across the board, it is fair across the board, and you know what the rate is. But with wholesale sales tax it is concealed—concealed on rates and goods—and there are no input credits in relation to exports or anything else. But not only did the Labor Party increase, secretly and deceitfully, its wholesale sales tax rates after 1993, they also said that they could pay for income tax reductions without increases in indirect taxes. In fact, they did not say they could pay for it; they said it was l-a-w.

Opposition members interjecting


Mr SPEAKER —I warn honourable members. I will not do so again.


Mr COSTELLO —Those l-a-w income tax cuts have still not been paid to this day.

Mrs Crosio interjecting


Mr SPEAKER —Under 304A, I ask the member for Prospect to leave the House for an hour. I have warned the honourable member for Prospect on two occasions. I ask her to leave the House for an hour.

The honourable member for Prospect thereupon withdrew from the chamber.