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Tuesday, 8 December 1998
Page: 1644


Mr LAWLER (10:17 PM) —I rise to speak on the A New Tax System (Goods and Services Tax) Bill 1998 and cognate bills. I am new to this chamber and I have listened to speaker after speaker on this tax legislation. I am amazed that the ALP is whingeing about having only 20 hours to debate this issue. I have listened to the same old tired arguments time after time, which are thrown back and forth by speakers on both sides of the House with the mission in life of speaking for all of their allotted time, regardless of the content or the level of new argument.

Pardon me for expecting lively debate, with the opposition throwing up legitimate problems and being quickly and concisely rebutted by members on our side. The arguments going back and forth are the same ones which were thrown up day after day in the election campaign. They are the same questions. How can the Labor Party possibly argue for more than 20 hours of debate when we are going over the same old ground? They say that the black economy will be worse; we say it will be better. They say that the tax taken off fuel will not be passed on; we say it will—and they obviously do not know the cutthroat truckies that I know!

Some of the old ground they are not going over is their big challenge to the 1.9 per cent one-off inflation figure which was in the Treasury figures that were mentioned earlier. Over and over they have called for that to be recalculated in different ways. Lo and behold, when the figure was calculated in different ways, it was basically the same—it is largely correct, and so we have not heard much on this ever since. They talk about the GST being an evil hidden tax. It is not hidden at all in the way that wholesale sales tax is hidden. It is clear because it is consistent from one product to another and from one business to another.

The tax legislation is all inquired out. No number of new reports or examinations by economists is going to uncover all the intricacies of such wide-ranging reform. It has been on public display for months now, and no group has shot any serious holes in it. In fact, the welfare groups all recognise that tax reform is necessary. It is the only way that we can guarantee that the workers of this country will be able to support our ageing population in years to come. We must encourage savings.

It is widely recognised that the Australian economy will not fall over tomorrow if we do not fix the 1930s tax system, but it will fall over soon if we continue to ignore the area of taxation which the current system ignores—that is, the tax on services. The tax on services must not be ignored because that is the tax that is not being paid by the wealthy. The wealthy spend more on services than the financially disadvantaged. It was fine to pick up indirect taxes on goods only when goods were responsible for about 80 per cent of our economic output. It is not fine to continue this practice today when 80 per cent of our output is services. Not only that but, as I said, the rich are the biggest users of services.

The Labor Party is very good at picking up small areas in the package and ignoring the parts which offset the disadvantages it points out. It is like walking into a pristine park and condemning the park because there are half-a-dozen pieces of trash lying on the ground. The member for Hotham actually said in the chamber on Monday that Labor supports tax reform. I can only guess that the reform he is talking about is the grabbing of the assets of our elderly via their pre-1985 capital gains tax or that huge revenue raiser—a tax on caviar.

The Labor Party says it is worried about small businesses. Small businesses, by and large, welcome tax reform. They can see that they will have to implement changes to their businesses, but they can also see that, by getting rid of provisional tax, they will be much better off and that, by reducing their tax rate to 30 cents in the dollar, they will save huge amounts.

It is absolutely crazy to tax when we earn instead of taxing when we spend. In my pharmacy, my team work very hard. They are honest and dedicated. If they are working about a 35-hour week and someone rings in sick and I have to ask them to work an extra day, by and large they do that. But they will work that extra day for the grand sum of about $20 in their pocket. Why? Because they go into the next tax bracket and lose most of it in tax. Is this a sensible tax system, one that discourages people to work harder?

I know a gentleman who also was a hard worker. He worked two jobs. He was a butcher by day and a waiter by night. One day he came into my pharmacy with a health care card. I was quite worried and I went out and had a yarn to him. He told me that, after working two jobs for two years, he ran into a bloke who told him he was mad, that he was much better off quitting his second job and getting more family allowance and going on to a health care card. Is this a sensible tax system, one that actually encourages someone not to work to support themselves because someone else will?

We have developed a very strange culture that encourages us to blame others for our mistakes and to find someone else to pay for our needs. We need to turn this around, and we have to have reward for our effort. Profit is not a dirty word. We need people to make a profit. We need people to get off their backsides and be rewarded for it. The tax system we have does not do this. It discourages enterprise and rewards mediocrity. This is not the foundation that Australia was built on.

Much is made of pharmacy problems. Yes, it is a bit of an imposition, but most of us look at the big picture, and we cannot have the gain without the pain. The member for Jagajaga constantly talks about Panadol for pain. Most disadvantaged people get their pain relief medication on scripts, and scripts are GST free. Others who are not particularly disadvantaged occasionally buy a 24-pack of Panadol. The 10 per cent GST on this pack is about 20c. Calculate that over the year on an ordinary person's spending on Panadol. The member for Jagajaga also says that people use cough and cold medications and Panadol every day. I can tell you, Mr Deputy Speaker, that the only ones who need to Panadol every day are the ones who sit on this side of the chamber and have to listen to the prattlings that go on on that side of the chamber. Sometimes a bit of cough medicine might help us get to sleep at night.

We need to change the tax system. We need to remain a vital economy, one that can look after our elderly and our disabled. Let us look at the big picture, the one that admits a 1.9 per cent one-off inflation rate but also sees that 80 per cent of Australians will be paying less than 30 cents in the dollar tax and one that encourages effort and rewards savings. When we have done that, we will be able to look forward to facing the next millennium.

Debate (on motion by Mr Melham) adjourned.