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Wednesday, 11 May 1994
Page: 611


Senator MICHAEL BAUME (1.30 p.m.) —For medical reasons, as honourable senators can probably hear, I should not be speaking, but I am so annoyed, so enraged in fact, by the con job done on the Australian public and on the Australian media by last night's budget that I really must speak. The budget is the worst tax rip-off for 10 years. That is the real hidden whammy in last night's budget. We would not know that by reading the newspapers today or by listening to the television or the radio. Hidden away, more than 300 pages into the budget documents and not even mentioned in the incredibly dishonest speech that has been presented to this parliament about the budget, is the fact that total tax revenue is budgeted to rise in the coming year by a record $9.15 billion. This will lift total tax collections by the Keating government to the highest ever level of $103.3 billion. That is 2 1/2 times higher than the $41 billion total of the Fraser government's last year in office.

  After adjusting for the forecast inflation rate of 2.25 per cent, real tax revenues in this budget will jump by 7.4 per cent. That is more than double last year's budgeted tax rise of 3.9 per cent, which the media jumped up and down about, as they should have, because the government went to the election promising tax cuts. Last year we had a 3.9 per cent rise. This year tax revenue is to rise by 7.4 per cent after accounting for inflation.


Senator Campbell —You are wrong. It was not a promise; it was l-a-w.


Senator MICHAEL BAUME —As my colleague from Western Australia, Senator Campbell, points out, it was not just a promise; it was supposed to be law—l-a-w, in case we could not understand it. We understand it all right. The word `law' to the government is clearly a dirty three-letter word, because here, in two years, we have had almost a 12 per cent real rise in tax revenues when there were going to be tax cuts. This year's 7.4 per cent real rise in tax revenues, after accounting for inflation, is not only double last year's rise of 3.9 per cent; it is the biggest tax rise since the 11.6 per cent real rise in tax revenues in Paul Keating's 1984-85 budget. It is the biggest rise in tax for 10 years.

  I did not see that recorded in any of the expert commentaries by the media. I did not hear that in any of the expert commentaries on the radio or on television. How can the government get away with this blatant deception, this incredible tax rise? What is it that allows a government to go to an electorate and lie its way into office with promised tax cuts and then, when it does not deliver them, it is exonerated? It is not even mentioned in the media. Our shadow treasurer mentioned the 7.4 per cent real rise in tax revenues, but I have not seen it given any prominence whatsoever. Why are the media letting this lot off the hook? Why does the government not have to wear the consequences of its deception? That is why I am so angry. That is why I am talking when I should not be, when my voice is destroyed.

  The government is pretending that there are no new taxes in the present budget. The fact is that there are huge tax rises in the present budget resulting from, among other things, the tax hikes announced in the last budget but being implemented only in this budget. Let us have a look at some of these rises. The pay-as-you-earn tax that hits ordinary wage-earning Australians will go up in this budget by $3.6 billion, or 8.1 per cent. That is more than double the big rise that took place in last year's budget. That is not some sort of tax on business; that is a tax on ordinary Australians. It is a huge rise on top of last year's rise. But I say, `Don't worry, chaps and women; you were told there would not be a tax rise. In other words, you were lied to again.'

  Fuel taxes are going up by 12.6 per cent. Honourable senators should compare that with the opposition's undertaking to reduce the price of fuel in the last election. Taxes on superannuation funds go up by 27 per cent—it is not really worth while trying to look after oneself in one's retirement under this government—and sales taxes and excises are going up under this budget by a further 8.3 per cent on top of last year's 10.8 per cent. That makes a huge two-year increase of more than 20 per cent in sales tax and excise revenue—representing, in fact, Mr Keating's hidden alternative GST. We have got the GST that he said we must not have—that this government campaigned against. Here we have a huge 20 per cent increase in sales and excise taxes without any of the offsetting cuts in income taxes which had been promised in the coalition's package.

  We have got the worst of all worlds under this government, with huge rises in income taxes and huge rises in indirect taxes. Yet when I came into the Parliament House today there was a group of television and radio interviewers at the front door and they asked me, `What will the opposition's tactics be, in view of the fact that there will be no tax rises in the current budget?' I must say at that stage I was sufficiently concerned about my voice to suggest they ask someone who could speak. I was close to speechless anyway, but hearing that question I became totally speechless.

  That is the sort of nonsense that members of this press gallery are prepared to spread around. I cannot say they knew it to be false; they just did not know. They just had not read it, because they had not got as far as page 300 in the budget documents. I suppose I cannot blame them. One would expect an honest government to have said in its budget speech that that was what it was going to do to taxes, having made such a huge issue of it.


Senator Sherry —What is your leadership doing? Asleep, are they?


Senator MICHAEL BAUME —What did our leadership do? Our leadership mentioned the fact in its press releases. I have just quoted the shadow treasurer. It is only the second paragraph, so maybe Senator Sherry had better get back to reading it. I will read it for him, because obviously he is incapable of understanding it:

Alexander Downer MP, Federal Member for Mayo, Shadow Treasurer.

I will read the first two paragraphs. They are worth reading. They say:

The 1994-95 Budget is a tax-and-spend Budget. This is the Budget of a Government squandering the benefits of recovery.

Hear, hear!

For most Australians—

—this is the second paragraph, for the Parliamentary Secretary:

For most Australians the Budget means a higher tax burden and, in time, higher interest rates. In real terms, the tax take in this Budget increases by 7.4 per cent.

So maybe those opposite will stop chirping and listen to the facts.


Senator Sherry —Why aren't the press listening to you? Because you have no credibility, is it?


Senator MICHAEL BAUME —He said the press did not run it because we do not have any credibility. The fact is that this government has conned the media and conned the parliament of Australia. This minister has no defence of that beyond saying he does not want to listen to us on our side. The facts are clear—and stated, if one can get as far as page 300 in the budget papers to find the hidden whammy of a dishonest government. That is the fact. I am concerned that there has been not one headline, not one attack in the media on this huge tax rise. I just wonder why we do not talk about these things any more in the media. Why is this government allowed to get away with it?

  If these tax rises were to be used for any real benefit to the economic recovery, then there might be some case for saying that this kind of tax increase could perhaps be justified. For example, the government could have used them by slashing the deficit, which all the economic commentators say should have been done and must be done. As Ross Gittins in this morning's Sydney Morning Herald says, an incredible opportunity has been lost. If the government were to use these tax rises in that way then there might be some case for saying that this kind of tax increase could be justified. But not when it has promised not to do it; not when it is wasting the results of those tax rises anyway; not when it is using those tax rises as part of a deception of the Australian people; not when it is reneging on its undertakings.

  As Dr Hewson pointed out in his media release, this budget is undertaking a blatant breach of the commitment that the Prime Minister made in March 1992. Mr Keating will be pocketing at least $4 billion to $6 billion over the next four years in bracket creep, as taxpayers are pushed into higher tax brackets because of the impact of inflation. The tax grab is Mr Keating's hidden Working Nation levy—and it is a levy on all Australians; that is the simple fact—the biggest tax grab for 10 years, and not revealed as such. You have got to go to page 300 to find out about it. This is a dishonest government; this is a disgraceful government; this is a government that seeks to con the people of Australia and to tax the living daylights out of them. This is a government which does not deserve to last, which did not deserve to win office. Its deception is now being demonstrated in this dishonest publication which hides, on page 300, the worst tax grab in 10 years.