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Tuesday, 24 November 1959


Mr BEAZLEY (Fremantle) .- The measure that is before the House should remind' honorable members that sales tax is becoming a problem for the Administration, and that the Taxation Branch is compelled to employ a large number of civil servants in the capacity of sales tax experts. It appears that somebody omitted to include station vans and other types of vehicles amongst those that would attract a sales tax rate of 30 per cent. For this reason, the only substantial provision in the bill is that which provides for the following item to be added to the fifth schedule to the principal act: -

Motor vehicles that are so constructed as to be capable of being readily converted (whether with or without the addition of seats or other fittings) into sedans, station wagons, estate cars or vehicles similar in design to station wagons or estate cars.

The effect of the measure is to increase the sales tax on these vehicles from' 16! per cent, to 30 per cent. Apart from an army of civil servants who must be employed as legal experts for sales tax, and this is a legal decision now being introduced, this level of sales tax for any motor vehicle is undesirable. It means that a £1,000 vehicle becomes a £1,300 vehicle, with £300 sales tax on it. If the argument is that sales tax is a desirable way for a government to get revenue, and that must be the philosophy of this Government because it is constantly increasing indirect taxes, we must recognize one thing that is happening in the community: This sales tax gravely affects the price, of all sorts of vehicles that carry no- sales, tax and prodace no revenue for the Government, and that is the great desideratum of the Government. If any name is to be given to the sales tax on motor vehicles, it ought to be "the second-hand car dealers' charter". The second-band car carries no sales tax, but its price is enormously increased, because the new car instead of costing £1,000 costs £1,300 when sales tax of £300 is imposed. This increases very greatly the price that can be commanded by the second-hand dealer, and this increased price does not produce any revenue for the Government, so that it becomes another item of straight inflation. Not only is sales tax directly inflationary, but it is also indirectly inflationary. If the honorable member for Mallee (Mr. Turnbull) can rejoice at this bill, his must be the most flimsy reason for which any one has rejoiced in this Parliament.







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