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Wednesday, 9 December 1998
Page: 1712


Mr CAUSLEY (1:52 PM) —It is a pleasure to rise in the House and debate the A New Tax System (Goods and Services Tax) Bill 1998 and cognate bills. It is quite aptly named, I note, `A new tax system'. I have listened with some interest to the speakers opposite. In particular, I note that they have avoided the main issues at stake here and concentrated on a GST. They have tried to put forward the scare campaign that they did so well in the election campaign, and which was rejected by the Australian people, that all things would rise in price with a GST. I note that they deliberately skate around the fact that the wholesale sales taxes that are presently in place will be removed.

I heard the Leader of the Opposition this morning blustering on in a speech that if you went to the gym it would be taxed. The Treasurer is not going to get too much tax out of the Leader of the Opposition—I do not think he is going to be going to the gym—but the fact is that he avoids the fact of life that on all sporting goods at the present time there is a 22 per cent tax. So people who are in the sporting field and using all this sporting equipment will have reduced tax on the equipment that they are using.

I have not heard anyone on the opposition benches talking about cosmetics, for example. Cosmetics at present are taxed at 30 per cent, yet that rate will drop to 10 per cent. If you look at so-called luxury goods—televisions, radios, videos, and sound equipment for kids—the present tax rate is 30 per cent, yet it will drop to 10 per cent. We do not hear that in the debate from the opposition: they want to avoid all those references.

One of the things that comes through loud and clear to me is that ideology is driving the Labor Party in this debate. They want to drag everyone down to the same common denominator, the lowest common denominator. They do not want to see any incentive in the system in Australia. One of the problems we have is that incentive has been removed. What incentive is there for people to go out and have a second job? What incentive is there for a family to have two jobs? The current tax system means that people get less in their pay packets than people on the dole with two or three children. Incentive has gone from the system.

Most people in this chamber would know my background but I will remind you of just a little of it. I was one of those who gave up a teachers college scholarship and went canecutting for my first job. That was a few years ago. In 1958, when I was receiving my first pay packets, and working very hard as a canecutter, I was earning £100 a fortnight in some instances. The tax on that £100—yes, it was pre 14 February 1966—for the fortnight was £20. I was a single person. I still had £80 left over. That was a lot of money in those days. There was incentive in the system in those days so that you could go out, you could work, you could save, you could invest and you could better yourself. Those incentives are gone in the system that we have today.

The Treasurer has said on a number of occasions, and there is no doubt—and even members of the opposition quietly admit—that the tax base is getting narrower. The only way that you can run the country and raise the funds that are necessary to run the country is to increase wholesale sales taxes and to increase personal tax. We saw that very clearly in 1993, when the then Prime Minister, who had campaigned very strongly against the GST at the time, came into the House and, at the dead of night, increased all wholesale sales taxes because he could not raise enough funds to run the country. It is a fact of life that the system has to be changed and the burden of taxation has to be spread across the community.

The opposition also ignore the fact that the series of bills that is before the House also addresses those people who are minimising their taxes, who are creating trusts that deliberately reduce their income and also, of course, reduce the tax they have to pay.

One thing coming from the opposition benches that I find quite amusing is the fact that they do not seem to understand that the people who pay the most tax in Australia at present are those PAYE taxpayers who have not got a second property. They are the ones who cannot avoid taxation. Other people who have got investment property can reduce their liability on tax. I think Fred Daly once said that poor people pay tax and rich people pay their accountant. That is quite legal, but there is no doubt that those people do minimise their tax. They are not avoiding tax, they are minimising their tax.

The Labor Party are often prone to quote presidents of America. I think it was Abraham Lincoln who once said, and I paraphrase: You cannot build up the poor by dragging down the rich. That attitude seems to be absolutely paramount in the Labor Party. The Labor Party have also gone on at some length to say that they are going to defeat these bills in the Senate. I would like to say a few words about that in the remaining time that I have.

One of the most pointed remarks that has been made in recent times was made by the Prime Minister himself after the Premiers Conference. I heard the member for Watson talking about premiers and the way that they would accept money. I think it was that the most dangerous place to be was between the premiers and a bucketful of money. But the point that was made by the Prime Minister is very relevant in this debate, because if anyone cares to go back to Federation, when this parliament was set up and when the Senate was set up, it was very clear that the role of the Senate was to be the custodian of states rights; it was the house that was to protect states rights.

We have had all the premiers in Australia come to Canberra, discuss this package with the Prime Minister and the Treasurer, and agree that this is a tax reform that is necessary for Australia. If the Senate does anything else but listen to those premiers, then they are playing their own egotistical political games—that is all they are doing. It is about time the Senate realised what it is about: it is there to ensure that this House does not discriminate against the rights of the states. That is what they are there for and that is what they should take note of. For the Labor Party to say that they are going to govern in the Senate because they did not get the right to government in the lower house is an absolute disgrace. The Leader of the Opposition should hang his head in shame for even considering supporting such a proposition.

Mr Melham interjecting


Mr CAUSLEY —The member for Banks, of course, would never consider that. As I said, this is a very important set of bills. Another thing that the opposition have never mentioned in this debate—

Debate interrupted.


Mr SPEAKER —Order! It being 2 p.m., the debate is interrupted in accordance with standing order 101A. The debate may be resumed at a later hour. The member will have leave to continue speaking when the debate is resumed.