Mr TRUSS (Minister for Agriculture, Fisheries and Forestry) (12:31 PM) —Thank you, Madam Deputy Speaker, for that history of this debate. It may draw the attention of the House to the fact that this bill, the Primary Industries (Excise) Levies (GST Consequential Amendments) Bill 2000, is actually about deer velvet and goat fibre levies. Debate has certainly ranged over a wide range of subjects. The honourable member for Paterson, who has quickly scurried from the table, rather than hear the facts in response to his tirade of abuse, is desperately attempting to scaremonger about the new tax system—a new tax system which he knows will deliver $1 billion of savings to farmers and therefore provide significant benefits to his own constituents as well as to other people in rural and regional Australia.

He raised a number of specific issues which have nothing whatever to do with this bill, but to which I feel I must respond. His suggestion that somehow or other this government was bribing the states into dairy deregulation is clearly a nonsense. The dairy deregulation is legislation being introduced by the various states, including his own state Labor government in New South Wales. It is Richard Amery who will be introducing the legislation to deregulate dairying in that state, not the federal government. It will be the other Labor state agriculture ministers around Australia who will be introducing the legislation to deregulate. The federal government has responded to the self-evident fact that deregulation will significantly reduce dairy incomes and will create considerable pain and hardship, for both dairy farmers and their communities. So the levy has been introduced to help fund some assistance to enable dairy farmers and their industry to adjust to the different circumstances.

He also made some comments and endeavoured to suggest that there was going to be great confusion in saleyards on 1 July when the GST is introduced. Farm organisations, auctioneers and buyers have been working very cooperatively on putting in place what will, I think, develop into a common system which will apply to cattle auctions around Australia. The legislation enables auctions to occur either GST inclusively or exclusively. But there seems to be a unanimity within the cattle industry that auctions should occur GST exclusive, with the GST being added after the knock-down. So there will be no confusion about whether one or two of the vendors happen to not have an ABN number or the like. The auction will occur in exactly the same way and all cattle will be treated equally in the saleyards.

In relation to an alleged cost burden for auctioneers and agents, in administering the tax system there will be some costs associated with administering the new GST but they will be significantly offset by savings and getting rid of other taxes. In addition, the honourable member referred to a cash flow of $200,000 that he said would have to be remitted by a particular agent. That agent has the benefit of using that $200,000 while he waits for the day when it must be remitted to the government. So there will be significant cash flow advantages to auctioneers and agents. They get to keep the interest that is earned on that money. So the benefits to agents and auctioneers will be significant through the cash flow effects of the GST. Of course, auctioneers and agents trading profitably get the benefit of the income tax cuts and the other benefits that the new tax system provides.

So those extraneous issues, which were raised in the debate as a smokescreen to cover the opposition's complete lack of effective response to the need for tax reform in Australia, are empty issues. The opposition have used a comparatively insignificant piece of legislation as a forum to rerun all of their tired old arguments about the GST and to defend the economies of Botswana and Swaziland rather than address the real issues of the need for tax reform in this country. This bill before the House is not a GST bill but a bill about amending the base on which levy payments for two primary industry excise levies are calculated. It is necessary to ensure that the GST does not result in higher levies being paid than was originally intended. It is not a mistake or an accident or anything else, as has been suggested by opposition speakers on the bill. It is a fact that these levies are in place and the way to calculate them needs to be adjusted in accordance with the new tax system arrangements. It is important for deer velvet and goat fibre producers.

Whilst this bill will directly affect those two levies, a further 12 primary industry excise levies and national residue survey levies will be amended under the same principle that is being legislated in this bill through changes to the regulations. These levies are not included in the bill, as the relevant schedules in the Primary Industries (Excise) Levies Act 1999 and the National Residue Survey (Excise) Levy Act 1998 used the term `value', which is defined in the GST act as an amount exclusive of GST. However, with the regulations for these levies defining value as sale price, each individual regulation will be amended to indicate that the sale price is net of any GST.

Amendments to the wool tax, passed by parliament under the A New Tax System (Indirect Tax and Consequential Amendments) Bill (No. 2) 1999, provided a precedent for this bill. The wool tax is also calculated as a percentage of the sale price and the amendments passed by parliament last year excluded the GST from calculating this tax. This bill achieves a similar outcome for the deer velvet and goat fibre levies. The bill will assist the deer velvet and goat fibre industries by maintaining their levies at the same level after 1 July 2000 as would have occurred prior to that date. Whilst the opposition has moved an amendment not closely related to this legislation, which we will obviously oppose, I welcome its support for the substance of the legislation and commend the bill to all members of the House.

Amendment negatived.

Original question resolved in the affirmative.

Bill read a second time.