Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Friday, 4 September 1942


Mr CHIFLEY (Macquarie) (Treasurer) . - by leave - I move -

That the bill be now read a second time.

The Government intends that some portion of the present spending of the people on amusements should be diverted back to the Commonwealth Government in order to help to finance the war. Despite the curtailment of many forms of sporting activities, attendances as a whole at entertainments show a tendency to increase. A great deal of the resources upon which people draw to meet their costs of entertainment are to be found in the war expenditure of the Commonwealth itself. The Government does not wish to impose undue prohibitions on the people, but it considers that whilst many of our men are absent from their homes on active service, and whilst many others are working long hours in essential employment, those who still have the leisure to frequent places of entertainment should be prepared when they do so to make a contribution to the war effort. The rates of tax proposed are heavy. They will serve to bring significantly to the notice of 'people who attend entertainments the fact that the nation is fighting for its existence.

When the Government decided that it was necessary to enter this field of revenue it found that in five of the States there existed an entertainment or amusement tax. In the sixth State there was no such tax. The rates of tax varied considerably, as did also the incidence of the tax. It became obvious that if a tax which would achieve the objectives sought by the Common wealth were to be imposed it was desirable that the varying taxes of the States should be suspended. The Government, therefore, decided to approach the State Governments with a proposal that they should, upon payment of compensation, vacate the field entirely and leave it to the Commonwealth. The first approach was made at the Premiers Conference, held in Melbourne during August. One State only, namely, Tasmania, indicated at the conference that it was willing to agree to the suggestion of die Commonwealth. The other four States, namely, New South Wales, Victoria, South Australia and Western Australia, desired to give the matter further consideration and requested that the Commonwealth should put its proposals in writing. The Prime Minister, therefore, wrote to the Premiers of the States, and they have in reply signified their willingness to vacate the field in favour of the

Commonwealth for the duration of the war and one year thereafter. The States are to bc compensated upon the basis of the revenue formerly received by them from this source. I desire here to record the Government's appreciation of the co-operation of the State governments in the matter. The bills contain clauses which will cause the tax automatically to cease on the last day of the first financial year to commence after the war ends.

This bill, if accepted, will represent the second occasion upon which the Commonwealth has imposed an entertainments tax. Honorable members will recall that the Commonwealth entered this field during the last war, and the tax was imposed on the 1st January, 1917. After the war- the tax was gradually lifted until in 192* it applied only to admission charges of 2s. 6d. and upwards. In 1933, the Commonwealth vacated the whole field in favour of the States as a part of the financial arrangements made to enable them to recover from the effects of the depression. The proposed Commonwealth legislation in. substance follows on the lines of the previous Commonwealth act. The tax is payable upon the price of admission to the entertainment. The tax commences at 3d., which is levied upon admission prices of ls., and increases with each 6d. increase of the price of admission. No tax is payable on admission prices of less than ls. The Government has decided that the legitimate stage and other entertainments in which artists appear in person should receive some concession in rates, .and accordingly has provided for them a special scale in which the rates are approximately 25 per cent, less than the general rates. I shall explain the rates of tax in more detail when I introduce the rates bill. It is estimated that the gross revenue that will be collected from this source for a full financial year will be £3,250,000. Compensation payable to the States will amount to approximately £765,000, leaving a net revenue to the Commonwealth of £2,485,000. For the balance of the present financial year it is expected that the Commonwealth will collect about £2,430,000, out of which compensation will be payable to the States of approximately £575,000, leaving a net revenue to the Commonwealth for the current financial year of £1,855,000.

The bill provides exemption for entertainments where all the proceeds, without any charge for expenses, are devoted to public, patriotic, philanthropic, religious or charitable purposes. If the entertainment is wholly of an educational character, or is of a partly educational and partly scientific character, and is conducted by a society not established or carried on for profit, or all the net proceeds are devoted to the erection, maintenance or furnishing of memorial halls for the use of returned soldiers, sailors and airmen, it will be exempt from tax. Where the net proceeds of an entertainment are devoted to public, patriotic, philanthropic, religious or charitable purposes, and the expenses do not exceed 50 per cent. of the receipts, it will be exempt. If the attendance at such an entertainment, owing to inclement weather or other unforeseen circumstances, is so reduced as to cause the expenses to exceed 50 per cent. of the receipts, the Commissioner has power to grant exemption. During the operation of the previous Commonwealth Entertainments Tax Act, dinner and supper dances were a continual source of difficulty. The proprietors of some of these functions maintain that the whole of the payments made by tie patrons have been for the dinner or supper and the dancing is merely incidental. This claim has been successfully maintained even in those cases where a first-class dance band has been in attendance and dancing has proceeded from about 8.30 p.m. until 2 a.m. A provision has, therefore, been inserted in the law to enable such entertainments to be taxed, whilst at the same time ensuring that the meal at which merely incidental music is provided is not taxed.

The bill contains provisions for the registration of all entertainments and, to ensure that the casual entertainment does not escape, provides that a liability shall rest upon the owner or lessee of the premises in which the entertainment is held to see that no unregistered entertainment is held on his premises. The tax is to be collected by the proprietor of the entertainment and paid over to the Commissioner of Taxation, either prior to the entertainment being held by the purchase of stamped tickets of admission or within seven days of the holding thereof where a guarantee has been lodged. The usual provisions are included for the imposition of penalties for offences against the provisions of the act. The bill provides that the tax shall operate on and from a date to be proclaimed. The intention is that the date of operation of the tax shall be the 1st October, 1942.


Sir Charles Marr -Will provision be made to prevent an admission charge of1s. from being slightly reduced in order to obviate payment of the tax?


Mr CHIFLEY - Yes, provision against that will be made later.

Debate (on motion by Mr. Fadden) adjourned.







Suggest corrections