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TAXATION LAWS AMENDMENT BILL (NO. 3) 1986
BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1986

Order of the Day read for the adjourned debate on the motion of the Minister for Community Services (Senator Grimes)-That these Bills be now read a second time-And on the amendment moved thereto by Senator Messner, viz: At end of motion, add: "", but, in respect of the Taxation Laws Amendment Bill (No. 3) 1986, the Senate condemns the Government for-

(a) its failure to control Government spending to the point where it has broken its "Trilogy' commitment to hold taxation to no more than 25 per cent of gross domestic product and proceeded to tax Australians to the highest point in our history;

(b) its contempt for ordinary taxpayers, illustrated by its decision to charge a $200 fee for appeals against the Tax Commissioner's rulings regardless of the size or complexity of the claim;

(c) its incompetent handling of the withholding tax issue, whereby the Government changed the tax rules, caused a run on the dollar, and retreated 27 days later; and

(d) its disgraceful treatment of the Defence Forces Reserves, by withdrawing the tax free status of reservists' pay, thereby causing a grave rundown of reserve forces and damage to their morale and effectiveness, and belatedly restoring the concession.

Debate resumed.

Senator Siddons moved an amendment in respect of the Bank Account Debits Tax Amendment Bill 1986, viz: Leave out all words after ""That'', insert ""The Bill be withdrawn and redrafted to provide for a tax at the rate of 0.5 per cent of all debit transactions, irrespective of their magnitude, in place of the current rates of tax, and that the additional revenue raised be used-

(a) to reimburse the States and Territories for the abolition of pay-roll taxes; and

(b) to increase social welfare spending''.

Debate continued.

Ordered-That the Questions for the second reading of the Bills be put separately.

TAXATION LAWS AMENDMENT BILL (NO. 3) 1986-

Question-That the words proposed to be added be added (Senator Messner's amendment)-put

The Senate divided-

AYES, 29

Senators- Alston Archer Baume, Michael Baume, Peter Bjelke-Petersen Boswell Brownhill Carrick, Sir John Collard Crichton-Browne Guilfoyle, Dame Margaret Hamer Harradine Kilgariff Knowles Lewis MacGibbon Messner Newman Parer Puplick Reid (Teller) Short Teague Townley Vanstone Walters Watson Withers

NOES, 36

Senators- Aulich Black Childs Coates Coleman Colston Cook Crowley Devlin Elstob Evans Foreman Georges Gietzelt Giles Grimes Haines Jones McClelland McIntosh (Teller) McKiernan Maguire Mason Morris Powell Ray Reynolds Richardson Ryan Sanders Sibraa Siddons Tate Vigor Walsh Zakharov

And so it was negatived.

Main Question-put and passed.

BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1986-

Question-That the words proposed to be left out be left out (Senator Siddons' amendment)-put.

The Senate divided

AYES, 7

Senators- Haines Harradine Mason Powell Sanders Siddons Vigor (Teller)

NOES, 59

Senators- Alston Archer Aulich Baume, Michael Baume, Peter Bjelke-Petersen Black Boswell Brownhill Carrick, Sir John Childs Coates Coleman Collard Colston Cook Crichton-Browne Crowley Devlin Elstob Evans Foreman Georges Gietzelt Giles Grimes Guilfoyle, Dame Margaret Hamer Jones Kilgariff Knowles Lewis McClelland MacGibbon McIntosh McKiernan Maguire Messner Morris Newman Parer Puplick Ray Reid (Teller) Reynolds Richardson Ryan Sheil Short Sibraa Tate Teague Townley Vanstone Walsh Walters Watson Withers Zakharov

Amendment negatived accordingly.

Senator Mason moved an amendment, viz: At end of motion, add "", but the Senate is of the opinion that the tax imposed by the Bank Account Debits Tax Act is inequitable and discriminatory because it is proportionately greater on small bank debits and therefore bears more heavily on less affluent persons''.

Debate continued.

Question-That the words proposed to be added be added (Senator Mason's amendment) put.

The Senate divided

AYES, 7

Senators- Haines Harradine Mason Powell Sanders Siddons Vigor (Teller)

NOES, 59

Senators- Alston Archer Aulich Baume, Michael Baume, Peter Bjelke-Petersen Black Boswell Brownhill Carrick, Sir John Childs Coates Coleman Collard Colston Cook Cooney Crichton-Browne Crowley Devlin Elstob Evans Foreman Georges Gietzelt Giles Grimes Guilfoyle, Dame Margaret Hamer Jones Kilgariff Knowles Lewis McClelland MacGibbon McIntosh McKiernan Maguire Messner Morris Newman Parer Puplick Reid (Teller) Reynolds Richardson Ryan Sheil Short Sibraa Tate Teague Townley Vanstone Walsh Walters Watson Withers Zakharov

And so it was negatived.

Main Question-put and passed.

Bills read a second time.

The Senate, according to Order, resolved itself into Committee for the consideration of the Bills.

In the Committee

Ordered-That the Bills be considered separately.

TAXATION LAWS AMENDMENT BILL (NO. 3) 1986-

Bill, by leave, taken as a whole.

Senator Vigor moved an amendment, viz:

Page 8, after clause 19, insert the following new clause:

Losses and outgoings

""19a. Section 51 of the Principal Act is amended by adding at the end the following sub-section:

"(5) A deduction is not allowable under sub-section (1) in respect of expenditure for the purpose of the advertising or promotion of-

(a) tobacco, substances containing tobacco, synthetic tobacco or any substance intended or designed for smoking;

(b) cigarettes, cigars or other items intended or designed to be used for smoking; or

(c) smoking pipes or any other accessories, items or devices intended or designed to be used principally for or in association with smoking.'.''.

Debate ensued.

Question-That the proposed new clause be inserted in the Bill-put.

The Committee divided

AYES, 7

Senators- Haines Harradine Mason Powell Sanders Siddons Vigor (Teller)

NOES, 57

Senators- Alston Archer Aulich Baume, Michael Bjelke-Petersen Black Boswell Brownhill Carrick, Sir John Childs Coates Coleman Collard Colston Cook Cooney Crichton-Browne Crowley Devlin Elstob Evans Foreman Georges Gietzelt Giles Grimes Guilfoyle, Dame Margaret Jones Kilgariff Knowles Lewis MacGibbon McIntosh McKiernan Maguire Messner Morris Newman Parer Puplick Ray Reid (Teller) Reynolds Richardson Ryan Sheil Short Sibraa Tate Teague Townley Vanstone Walsh Walters Watson Withers Zakharov

And so it was negatived.

Bill agreed to.

BANK ACCOUNT DEBITS TAX AMENDMENT BILL 1986-

Bill, by leave, taken as a whole and agreed to.

Bills to be reported without amendment.

The Acting Deputy-President (Senator Coleman) resumed the Chair; and the Chairman of Committees (Senator Hamer) reported accordingly.

On the motion of the Minister for Finance (Senator Walsh) the Report from the Committee was adopted, and the Bills read a third time.