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Thursday, 25 October 1956


Mr BIRD (Batman) .- I propose to devote my time to discussing the Government's inexplicable reluctance to impose a tax on diesel fuel. This matter has been under consideration for some years. It was raised by the Premier of South Australia. Mr. Playford, at the Premiers conference in 1951. Since that time numerous bodies have suggested that, in order to raise additional finance to improve our increasingly bad road position, we should tax diesel fuel, thus putting that fuel on all fours with petrol, which is taxed by the Government. The position of the States regarding the financing of road construction and maintenance is becoming well nigh desperate because, as everybody knows, the State governments have practically no money to devote to the large programme of road construction and reconstruction that is vital if we are to have road transport befitting a modern, civilized nation.

In recent years the use of diesel-propelled vehicles has been steadily increasing. Not only have the numbers of such vehicles in ase on Australia's roads increased, but their size and weight has also increased. Anybody who has seen a diesel-propelled semitrailer hurtling along a highway can well imagine the dire effects on our road surfaces caused by the huge numbers of such vehicles now in use in Australia. I do not think :hat anybody either in this House or outside it would deny the damage done to our road surfaces by huge diesel trucks. In recent /ears there has been such a widespread demand that fuel for these vehicles should be taxed in the same way as petrol. All petrol used by motor vehicles in Australia is taxed, and two-thirds of the revenue from that tax at present goes to the States for expenditure on roads. 1 argue, of course, that the whole proceeds of the tax should go to the States, but that is not a matter under immediate discussion. Surely it is only fair and reasonable for the Commonwealth to accept the principle that if it is right to tax petrol-driven vehicles by taxing the fuel they consume, it is right to tax all vehicles that use our roads irrespective of the fuel they use,


Mr J R FRASER - Tyres could be taxed.


Mr BIRD - That has been suggested also but, at the moment, we are dealing with a tax which is levied on petrol and not on diesel fuel. A tax is imposed on tyres in the United States of America, but that is not the subject on which I am speaking. I am pointing out the anomaly in the treatment, for taxation purposes, of the two different fuels used in the propulsion of motor trucks.

The latest organization to come into the arena and demand the imposition of a tax on diesel fuel is the Australian Automobile Association, which is easily the biggest motor organization in Australia. That association recognizes the gross iniquity of taxing one set of motor users and not another set. The Government, for reasons best known to itself, refuses to say what it proposes to do. About fifteen months ago, I asked the Prime Minister (Mr. Menzies) for information mom the Government's intentions in relation to motor fuels. I received a reply from him in October of last year stating that the matter was still under consideration and that, possibly at the latter end of the financial year, the Government would make some decision The latter end of the financial year is long past. Recently. I asked the

Prime Minister a question in the House on this matter and he told me that, because it was a matter of policy, he could not disclose the intentions of the Government. 1 suggest to the Government that because of the desperate condition of Australian roads, it must raise additional finance to assist the States to put the roads into even a mediocre condition. I will not say " firstclass condition " because it is not possible for State governments, with the finance left to them, to make one decent highway. The observation of all overseas visitors when they travel around the country is, "What poor roads you have compared with roads in Europe, Africa, or America", or whatever country they come from. At the present time, the States are not receiving sufficient money to enable them to maintain the roads properly. The Government should explore every possible source of revenue in order that the States may be assisted in their terrific fight to maintain, at least, the semblance of a road system.

It is quite anomalous that trucks that use> diesel fuel should be exempt from the payment of fuel tax while trucks that use petrol must pay an impost. Not only must they pay an impost but, from March of last year, they had to pay an additional 3d. a gallon in tax. I suggest that that is only adding insult to injury. I wonder why the Government leaves the diesel trucks alone but increases the tax on petrol. Something has to be done. This is a source of revenue for the Government. Such a tax as 1 have proposed would give little offence except to a small group of hauliers who are waxing fat as the result of the Government's ineptitude.

Let us look at what is done overseas. After all, this country is not the Alpha and Omega of all knowledge with respect to transport. Let us see whether there is any reluctance in other countries to impose a tax on diesel fuel. In Great Britain, 25 years ago, the United Kingdom Government recognized that there was a case for the taxation of diesel fuel. In 1931 there was in operation a tax of 8d. a gallon on petrol but no tax was, at that time, imposed on diesel fuel. The United Kingdom Government recognized the iniquity of the position. So, in 1932. it imposed a tmi form tax on petrol and diesel fuel. The United Kingdom Government realized that it had been losing a lot of money and that the position which had existed was unfair. So the taxes on the two fuels were equalized in 1932 and on each occasion on which the tax on petrol has been increased the tax on diesel fuel has risen correspondingly. To-day, the price of diesel fuel in Great Britain is 92 per cent, of the price of petrol, because tax is paid on both fuels. In Australia, the price of diesel fuel is only 60 per cent, of the price of petrol because the Government will not face up to the position and do the fair thing by the State governments and the motoring community.

Crossing the Atlantic, we find that a tax was imposed on diesel fuel in the United States of America in 1942, ten years after the tax was imposed in the United Kingdom. In the United States, both State governments and the federal government have the power to impose taxes on motor fuels, and 46 out of the 48 States have a diesel fuel tax. In 39 of those States, the same tax applies to diesel as to petrol fuels. In the other seven States there is a heavier tax on diesel fuel than there is on petrol. In addition to the State taxes, a federal tax of 3 cents a gallon has been imposed on petrol and diesel fuel.

So, both England and America have realized that this problem cannot be solved, as this Government is attempting to solve it, by burying their heads in the sand. It is accepted in .England and America that if vehicles are to be taxed for the purpose of maintaining the roads that they use, all vehicles that use the roads should be taxed, not only vehicles that use one kind of fuel for propulsion.

One of the arguments that has been used in this country, although faintly, is that a lot of diesel fuel is used in vehicles that do not use the roads. That problem can easily be solved. In America, a refund of diesel fuel tax is made in respect of those vehicles which do not use the highways. If anybody suggests that that cannot be done in Australia, my reply is that it has been done in America for many years. It has been found that it presents no grave difficulty in that country because, when all is said and done, the use of diesel fuel is concentrated in the hands of a few transport companies. No difficulty has been experienced in America in taxing only those firms which use diesel fuel on the highways. If that is the Government's reason for not taxing diesel fuel in Australia-

Mr. ACTING DEPUTYSPEAKEROrder! The honorable member's time has expired.







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