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Tuesday, 24 November 1959

Mr HOWSE (Calare) .- The Opposition, in opposing this measure, has dragged the whole question of sales tax into the debate. I agree with many of the views that have been expressed by honorable members opposite. I did not enjoy paying sales tax on the station wagon that I own. The Opposition has sought to classify station wagons and to pinpoint the uses to which they can be put, but that is not the point of the discussion. What is the purpose of this bill? This bill seeks merely to correct an anomaly. In his second-reading speech, the Treasurer (Mr. Harold Holt) said -

The sole purpose of this bill is to take legislative action to prevent partial avoidance of sales tax which has arisen from a marketing procedure adopted by .a number of manufacturers of the station wagon type -of motor vehicle.

Apparently the honorable member for Maranoa (Mr. Brimblecombe) will vote against the bill because he is convinced that the Taxation Branch is not aware of the tax evasion that is going on. The Taxation Branch certainly is aware of it, but at present has no legislative power to deal with it. This bill will give the branch that power. Therefore, on the argument of the honorable member for Maranoa, he should support this bill and not oppose it. After all, the station wagon is purely a passenger vehicle masquerading as a commercial vehicle because most of them are used for passenger carrying work. The law says that a passenger carrying vehicle, no matter how it is used, must bear the 30 per cent, sales tax. It makes no difference whether you are a doctor, a dentist or a primary producer, the 30 per cent, sales tax must be paid on the passenger carrying vehicle that you use. In this instance, a station wagon is purely a passenger carrying vehicle and, therefore, should carry the 30 per cent, sales tax.

I could argue at great length on whether passenger vehicles should carry such a high rate of .sales tax, but that is not the point of the bill. We have to decide only whether station wagons, some .of which are now masquerading as commercial vehicles, should carry the 30 per cent, sales- tax as. do other station wagons that are on the market. To hear some of the arguments that have been advanced by honorable members opposite, one would think that the Government was seeking to raise the tax on passenger vehicles from 16$ per cent, to 30 per cent. This is not a new tax. It has been in operation for a long time. The bill seeks merely to close a loophole by giving the Commissioner of Taxation the necessary legislative power to impose on station wagons the rate of sales tax that is now applicable to passenger vehicles. All honorable members must be aware that certain makes- of vehicles which are being converted into station wagons are carrying only 16$ per cent, sales tax. Why should the few people who own those particular makes of vehicle enjoy that privilege? Most station wagons, for better or for worse, carry the 30 per cent sales tax. If the Government had not introduced this bill, we would have been faced with the position that all manufacturers of station wagons would have said, "Let us all be in on this party. Let us produce a commercial vehicle which will carry only 16$ per cent, tax and then we can sell the conversion kits at a reasonable price and avoid the additional tax". What would be the result? The Treasurer has said that if all the car manufacturers agreed to produce only a commercial vehicle the Treasury would lose about £3,000,000:

I am not in favour of the present high tax on passenger vehicles and I think that a good case can be made out for its reduction,, but the bill, now before us fills a very useful- purpose by closing an avenue by which a few people have been able to get under the guard of the Commissioner of Taxation. It is not often that I support him, but in this case I think that he should have the power that this bill seeks to give him.

Question put -

That the bill be. now read a. second time.

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