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Wednesday, 8 December 1976
Page: 3558

Mr Stewart asked the Treasurer, upon notice:

(   1 ) Has his attention been drawn to the suggestions made by the Australian Taxpayers' Association that (a) the company/shareholder tax situation should be modified, (b) indirect tax should not be charged on any items in the CPI figures, (c) sales tax should not be charged on any items acquired by firms which manufacture goods and (d) there should be a way of rebating the petrol tax paid on fuel for delivery vehicles.

(2)   If so, what is the attitude of the Government to each of these suggestions.

(   3 ) May I have an answer to this question by Thursday, 1 8 Nov. 1976.

Mr Lynch - The answer to the honourable member's question is as follows:

(1)   Yes.

(2)   (a) This relates to a basic part of the tax system, on which the Asprey Taxation Review Committee has made recommendations. The suggestions of the Australian Taxpayers' Association will be considered when the Government examines the Asprey recommendations.

(b)   As the Australian tax system needs to achieve a balanced structure with a significant proportion of revenue derived from commodity taxes, and as the consumer price index must adequately measure variations in retail prices for goods and services representing a high proportion of the expenditures, it will be recognised that the suggestion has serious drawbacks.

(c)   As the law stands, sales tax is levied at the point of last wholesale sale of goods, that is, at the point at which goods are sold either by a wholesaler or a manufacturer to a retailer.

(d)   In addition to the substantial cost to revenue that would be involved in exempting fuel used in delivery vehicles from duty, there would be major definitional and administrative problems involved in implementing any such proposal.

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