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Thursday, 23 March 1961

Mr SPEAKER - Order! I warn the honorable member that anything in relation to another place is on dangerous ground.

Mr DALY - It was reported in various newspapers from time to time when this matter was being debated that a senator from Queensland had said -

In the present case, we are not conscripting labour but we are virtually doing the same thing by saying to people, " You have to get out of this industry and find a job somewhere else ".

Mr Duthie - Who said that?

Mr DALY - A Liberal senator in criticizing the increased sales tax. When that legislation was introduced, Senator Wood pointed out that the Government was introducing legislation which should not be supported. Do you not notice, Mr. Speaker, that when I mention the criticism of one of their own members, members of the Country Party endeavour by way of interjection to stop me from proceeding?

The point that I make is this: The previous legislation should never have been introduced. It has produced disastrous results so extreme that the Government cannot control them. The Government has been forced by public opinion to remove the legislation because of the tremendous upheaval in the community.

Mr Turnbull - That is not right.

Mr DALY - It is all right for members of the Australian Country Party to interject but, as the Leader of the Opposition (Mr. Calwell) said, the hardest thing to find in this Parliament is a farmer among the members of the Country Party. Look at the honorable member for Herbert (Mr. Murray). He came into the Parliament as a Country Party member, saw what he had to sit with, and bolted with the speed of a jet to join the Liberal Party. Members of the Country Party here should be defending the rights of the people in regard to sales tax and other matters which affect men and women on the land, but they were prepared blindly to support the Government's policy because their party is just an appendage of the Liberal Party. They have no policy of their own, and are opposed to everything that is reasonable and decent.

Let us look at the changes that have taken place in respect nf these matters. I wonder what worker in industry and what member of this Parliament can follow the policy of the Government on sales tax and other matters. Let us remember that the Government was elected on a tax-reduction policy. The only tax reduction that it has ever given it gave a couple of years ago when it reduced income tax by 5 per cent. and in the following year restored it to its previous level. In other words, a Dutch reduction - -down one year and up the next. That is why the Government is completely discredited to-day. This is what a leading newspaper said a short while ago under the heading, " Round and Round With Holt " -

Federal Treasurer Holt has faced more ways than a merry-go-round in explaining his Government's economic policy.

This applies particularly to this sales tax legislation. The report continues -

In Adelaide on November 13 last, Mr. Holt denied Australia was facing an inflation crisis.

Two days later, on November 15, he announced increased sales tax on cars and tighter bank credit as part of the Government's new programme to check inflation. Since then, Mr. Holt has had this to say: -

November 18: The Government's new measures were not directed to crippling the local car industry, but to slowing down production.

November 21: Australia would have plunged into a depression as disastrous as that of the 1930's but for the Menzies' Government economic policy.

It changes like the weather. The report continues -

November 27: The recently imposed restrictions were " just one of the changes of tactics " necessary to maintain the Government's objectives - national expansion, full employment and a rising standard of living.

December 1: Criticism of the Government's measures would abate considerably when the full story of the Government's intentions and reasons was made known.

December 4: He had no regrets about any of the measures he announced on November 15.

February 20: Australia's economic situation might worsen before it improved.

Mr. Holtmade this last statement to an A.C.T.U. delegation.

The newspaper reported in the following terms a statement made by the Prime Minister on 21st February: -

Prime Minister Menzies announced that the Government had decided to drop the 10 per cent. sales tax increase imposed on motor vehicles on November 15.

It is history now that the Prime Minister did not even consult the Treasurer on these matters. Here is a man in a responsible position - responsible for the economic policy of the country - who made a number of conflicting statements. The day after he had told an Australian Council of Trade Unions delegation that things would be worse before they were better, there was a complete policy change, and the 90 days wonder tax was abolished almost overnight.

Then, the Sydney "Daily Mirror" of 22nd February published the following: -


Tax Reversal Shocks Cabinet.

Prime Minister Menzies did not consult Treasurer Holt before asking Cabinet yesterday to reverse its policy on car sales tax. Mr. Menzies had very brief talks with some Cabinet members, but apart from that took no one into his confidence.

And, as a pretty fair judge, I am sure that the Minister at the table would not be taken into his confidence. The Prime Minister knew that a major error had been made; he was frightened by the numbers of people who were unemployed in the country because of his policy, and by the pressure applied on him by wealthy supporters of the Government. He knew that the policies which he had enunciated through the Treasurer were false and wrong and, as such, had to be repealed; and that is why this legislation is before the Parliament to-night. Government supporters will deceive nobody by claiming that this action is being taken from a sense of justice and that the Government did not intend to retain the increased sales tax indefinitely.

I recall that in 1956 a temporary sales tax was imposed on motor cars, but that tax still operates. So, when honorable members opposite claim that this measure has been introduced in fulfilment of a promise to the people, they are pulling their own legs; and that is a very dangerous game. Earlier, I mentioned that this Government was elected on a tax reduction policy. As my time is limited-

Mr Hamilton - Ah!

Mr DALY - A Country Party member says " Ah " when I mention tax reduction. And well he might, because he intends to withdraw from politics at the end of this year, no doubt because he is disgusted at the failure of the Government to carry out the policies that it announced. Members of the Country Party can interrupt as much as they like. Every time the honorable member for Richmond (Mr. Anthony) interjects, I think of the statement of the late William Morris Hughes when a man once asked him why he did not join the Country Party, and said to him, " It is the only party you have never been in ". Mr. Hughes replied, " Good Lord, man, a fellow has to draw the line somewhere "; and every time I look at the honorable member for Richmond, I realize what he meant.

Let us look at page 26 of the Prime Minister's famous policy document of 1949. Let it never be forgotten or taken from the archives of this Parliament, because it is an indelible record of the fact that the present Government parties were elected on false pretences. At page 26 of that document, under the heading " Taxation " - and do not forget it was paid for by private banks - we read -

We still believe that rates of taxation must be steadily reduced, as national production and income rise, and as economies are effected in administration.

Now listen to this promise on sales tax -

We will review the incidence of indirect taxes (which are a huge though sometimes unrecognized item in Australia) upon basic wage and cost of living items and housing costs.

This Government certainly made them recognizable. Let us look at how the Government has carried out its policy; and the thousands of people listening to this debate will no doubt realize why the Government is afraid. In 1948-49, the last year of the Labour Government, £39,000,000-odd was collected in sales tax, and last year the figure was £164,000,000, under this tax reduction Government. Would not the Government be a riot if it really carried out its policy? This financial year, £180,400,000 is to be collected in sales tax, as against £39,000,000 at the time when the Government was elected on a policy of tax reduction. Let us look at the Government's taxation of the individual. In 1948-49, under Labour, direct taxation averaged £57 per head of the population, but to-day, under this tax reduction Government, it is £135 per head. I suppose the Government is working on the basis that if it goes on long enough it will come back to where it started. That is about the only way in which its tax reduction policy will be carried out. The Government says that it had to take it out on the car industry, that there were too many cars in this country and too many imports to service the motor car industry. Two-thirds of the Government's supporters would not be here if they had1 not ridden into Parliament on the promise to abolish petrol rationing irrespective of the drain on our overseas reserves as a result of such action. Every member opposite me has quoted in this Parliament again and again the countless numbers of cars purchased by the people as an indication of the prosperity of the country and of what this Government has done for the country. But, to-day, the Government is not only forcing out of business car manufacturers; it is also forcing out of work the people employed in manufacturing them. This Government hypocritically got into office by boosting imports of petrol which this country could not afford at the time, and to-day it is trying to destroy an industry which Labour encouraged and expanded. I could speak for a long time on the Government's policy, because I know that under this tax reduction Government taxation has not been reduced. Under the Labour Administration in 1948-49, the general rate of sales tax was only 8i per cent, but now it is about 30 per cent. This Government came into office on its pledge to reduce direct and indirect taxation. But it repudiated that pledge; and1 now, like a thief in the night, it sneaks this legislation into the Parliament, without consulting the Minister, because it realizes that the people have had it. The Government now knows that the people will not tolerate its policies, which are completely destroying the economy of this country.

I welcome this opportunity to speak on this measure and with the Leader of the Opposition (Mr. Calwell) and other honorable members on this side of the Parliament, I say that the tax which has been taken from the people under false pretences should be refunded to them. To-day the Leader of the Opposition quoted instances in which taxation has been refunded in less justifiable circumstances. Would not the Country Party members be on their feet, man for man, for once in a while, if the Government took from the farmers even a couple of shillings and refused to give it back, no matter how unconstitutional or illegal such action might be? I have to talk for the farmers because nobody in the Country

Party is qualified to do so. I remind members of that party who question that claim that I come from Currabubula which is a centre of primary production. However, I shall not be diverted from making the remarks I wish to make finally.

The original legislation should never have been introduced, and the money falsely taken from the people should be refunded to them. The Government has changed its policy in the face of public opinion and to-day it wants to get this measure quickly through the Parliament in order to hide the blunder it has perpetrated. Look at the famous man of the mystic " 5 " who is silent to-night; his mystic " 5 " will not help him when the Government goes before the electors in the not-far-distant future. I support the Government's proposal to repeal the original legislation. It is interesting to note that the Government has seen the error of its ways; but I hope it will go the full distance and refund to the people of this country the money that has been taken from them falsely. It should also publicly apologize to Senator Wood and Senator Wright for its treatment of them when they were the only Government supporters who had the brains and the courage to oppose the increase of sales tax on motor cars.

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