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Friday, 19 October 1984
Page: 2074

Senator Sir JOHN CARRICK —My question is directed to the Leader of the Government in the Senate. I refer to the Prime Minister's statement that family homes would be exempt from a capital gains tax. Since the Prime Minister and the Government's decision making has advanced to a point on capital taxes that he is able to announce that decision on family homes, what is the position in relation to farmers? Will the same curtilage provisions apply to the capital gains tax as apply to the assets test?

Senator BUTTON —As I said before, the Government is undertaking a comprehensive review of the taxation system in Australia. The purpose of that review is to provide fairness and equity in the taxation system, which has not been the case over the years. I believe that most Australians, particularly pay as you earn taxpayers, recognise and feel very strongly about that. They feel very strongly about this Opposition too because it nurtured the tax avoidance industry when it might have been doing something about the position of PAYE taxpayers in this country. In the course of that review it is possible-I would think likely-that general questions relating to capital taxes will be considered. In the consideration of the whole tax structure and the part played by capital taxes in the whole tax structure, no doubt exemptions will be considered if the review recommends the adoption of any capital taxes. If the review so recommends it will undoubtedly recommend exemptions. In responding and making decisions about any recommendations which flow from the review, the Government will be guided by its fundamental concern in setting up the review, which is to ensure, as I have said, greater equity and efficiency in terms of business taxes in the taxation system. Decisions will be made at that time on that basis. I would think there is an enormously powerful argument in respect of taxes on farm homes and so on. But that is a matter which will arise from the review and will be given consideration in the light of the fairness and equity criteria to which I have referred.

Senator Sir JOHN CARRICK —I ask a supplementary question. The Leader of the Government has not answered my question. The Government has announced a specific decision in principle on homes. Why is it that it cannot announce a similar decision on homes of farmers and the curtilage involved?

Senator BUTTON —The Prime Minister has said that if in the context of any comprehensive review a capital gains tax of some kind or another were recommended, in the interests of fairness and equity the family home would be excluded. He has taken that no further than that. I do not seek to take it any further than that because the fairness and equity test will be the one which will be applied.