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Taxing time for senators -

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Taxing time for senators

The World Today - Thursday, 4 September , 2008 12:12:00

Reporter: Lyndal Curtis

ELEANOR HALL: The Senate has finally managed to vote down the Government's $550 million luxury car
tax increase but not without one more stumble being added to the mishaps of last night.

While it was the Liberals who were embarrassed last night, this time the Government had trouble
with its numbers.

But it didn't affect the outcome and that is that the Senate has voted down the first significant
Budget measure to come before it.

Not only does this leave car dealerships trying to figure out what to do with the money they've
already collected but it leaves the Government with a half-a-billion-dollar hole in its surplus.

In Canberra, chief political correspondent Lyndal Curtis reports.

LYNDAL CURTIS: There was sympathy this morning for Queensland Liberal Senator Sue Boyce who last
night didn't hear the bells ringing and missed the vote on the luxury car tax increase.

She apologised to the Senate last night and has offered another apology in writing to her
colleagues.

From all sides this morning, it was a case of there but for the grace of God.

BOB BROWN: I went over and had a word of sympathy to Sue Boyce because it's a terrible position to
be caught in.

GEORGE BRANDIS: Well, I think mistakes are made from time to time. People are human after all.

BARNABY JOYCE: Well I'm going to be the last one to criticise Sue Boyce. You know, these things
happen and Sue might have missed the vote, but I've actually voted for the other side a few times.

LYNDAL CURTIS: Independent Senator Nick Xenophon who's new to the Senate says he hopes it never
happens to him and he was philosophical about the outcome.

NICK XENOPHON: You know I think we can all take a leaf out of the Rolling Stones who I think once
said, "You can't always get what you want, but sometimes, you try hard enough, you get what you
need."

LYNDAL CURTIS: First thing this morning, the Coalition had all its senators gathered in the Chamber
in anticipation.

JOHN HOGG: The question is that the Bills be now read a second time. Those of that opinion say aye.

SENATORS: Aye.

JOHN HOGG: Against say no.

SENATORS: No.

JOHN HOGG: I think the no's have it. No's have it. Division required, ring the bells.

LYNDAL CURTIS: And this time with Senator Fielding sticking to his decision to vote against the tax
increase, the Opposition won.

JOHN HOGG: Order. There being 33 ayes, 34 no's, the matter is resolved in the negative.

LYNDAL CURTIS: This vote wasn't totally hiccup free. The numbers should have been 34-34, still
enough for the Opposition to claim victory but not a reflection of the actual numbers.

The Government vote counters, it turns out, forgot to count Senator Chris Evans, normally not a
difficult man to spot. He sits at the big table in the middle of the Chamber as the Government
Senate Leader.

But as one Senator said after the vote, the obvious is sometimes overlooked.

The whips from both sides met and decided to correct the record and Labor Senator Mark Bishop did
so from the President's chair.

MARK BISHOP: I am advised that it is agreed between Government and Opposition whips that the
outcome was 34 ayes, 34 in the negative, and accordingly the matter is lost.

LYNDAL CURTIS: The Coalition says it didn't know until he walked over to sit with the Opposition
senators last night that Senator Fielding was going to vote the tax increase down.

The Government had been negotiating with all the crossbenchers, agreeing to changes proposed by the
Greens and supported by Senator Xenophon to exempt fuel efficient cars, but Senator Fielding wanted
farmers and tourism businesses exempt as well.

That was a bridge too far for the Government.

Before the vote this morning, the Treasurer Wayne Swan told Radio National he wasn't doing any last
minute negotiating with Senator Fielding on the proposed changes.

WAYNE SWAN: Well because his requests simply couldn't be implemented. They would have been a
compliance nightmare.

LYNDAL CURTIS: The Greens Senator Christine Milne has been scathing about Senator Fielding's
performance.

CHRISTINE MILNE: What we've got is an irresponsible Coalition and a senator who says that he's
concerned about tourism operators and farmers but didn't develop any amendments himself, didn't put
anything on the table to discuss and isn't even prepared to see the debate through.

LYNDAL CURTIS: But Senator Fielding blames the Government for refusing to agree to his changes. He
says he was just standing up for farmers and tourism operators.

STEVE FIELDING: The Government seemed quite happy to give a tax exemption for Mercedes and some of
those higher end cars because of fuel efficiency, but they're not willing to give a tax exemption
to farmers? A tax exemption for tourist operators? Why wouldn't they do that?

LYNDAL CURTIS: The Coalition's industry spokesman Eric Abetz has proclaimed the Opposition and
Senator Fielding heroes of the car industry, tourism and rural and regional Australia.

He says the Coalition senators aren't Budget wreckers.

ERIC ABETZ: Well that's absolute nonsense. The one reason the Labor Party gave for this new tax was
to fight inflation. So how do you fight inflation by introducing an inflationary measure? The Labor
Party argument simply did not stand up.

LYNDAL CURTIS: The Chamber of Automotive Industries has been campaigning heavily against the tax
increase and has welcomed the Senate vote.

But the industry is faced with uncertainty. First, is the Government going to try again to get the
tax rise through in three months, and if not, how does the industry refund the money already
collected?

The Chamber's chief executive Andrew McKellar says the tax office needs to let car companies know
what to do.

ANDREW MCKELLAR: Many brands have been collecting tax in preparedness, had this legislation passed.
That will now not be remitted to the tax office. It needs to be refunded to customers and we need
clear advice from the tax office as to how that should proceed.

LYNDAL CURTIS: This is just the first of the significant Budget measures that has been voted down
by the Senate.

The Government still faces a fight over a number of others including the changes to the Medicare
surcharge thresholds. That vote is scheduled for today.

ELEANOR HALL: Lyndal Curtis reporting from Canberra.