Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Friday, 2 September 1921

Senator PEARCE (Western Australia) (Minister for Defence) .- This matter has been brought under the notice of honorable senators, and it is one which, of course, appeals to our sentiments; but we must have regard to other things as well, as we are the guardians of the taxpayers' interests. This matter has been fully considered since representations have been made, and the question has been thoroughly investigated by the Department. In the Excise Tariff, as introduced, the rate was as at present, viz., 25s. per proof gallon. On 17th September, 1920, it was raised to 28s. but it was subsequently reduced in the other House to 25s. on and after 8th July, 1921. In considering the rate on this item, it must be borne in mind that the spirit is used by chemists and many other manufacturers scattered in remote districts throughout the Commonwealth. Reference has been made to the conditions prevailing in the United Kingdom; but the comparison is not a good one, because Great Britain has a population of 48,000,000 people spread over a comparatively small area. When we consider the number of chemists that are scattered far and wide over this vast continent, it will be easy to realize the difficulty in administering such a provision. The Department would view with alarm any reduction in the rate, as supervision of the uses to which the spirit might be put is quite out of the question, owing to the wide distribution of the users. A substantial increase in the number of officials would be necessitated for the purposes of supervision, and even such increase would not furnish adequate protection against abuse. It is true that spirit free of duty is given to public hospitals, but in this case, owing to the comparatively few institutions involved, adequate supervision is possible. Supervision is possible because the spirit is delivered to and held under heavy bond by the principal hospital in the State, or by State Government Drug Depots, as in New South Wales, which is responsible for safe custody and proper use. The distribution by the principal hospital or State Depot is measured out on a fixed scale strictly proportioned to the ascertained monthly, or, in small hospitals, quarterly, requirements, and complete records are kept of the quantities required and distributed. It is therefore impossible for the hospitals concerned to use the spirit for other than the specified purposes, as any increase in the quantities delivered would be at once detected and immediately investigated. In the case of spirit delivered for use in fortifying wine, sub-item j, or in making vinegar, sub-item x, or for the manufacture of scents, sub-item l, the spirit is treated in the presence of an officer in such a manner as to make it practically impossible to use it for any other purpose. In the case of fortifying wine, an officer has control of the spirit until it is actually mixed with the .wine, and sees the operation done. The same procedure applies to spirit for making vinegar or scents. It would be impossible to apply this control and supervision to the thousands of chemists scattered throughout the Commonwealth. In taking this view no reflection is cast on the integrity of chemists. But it is a matter of ordinary human experience that, were a concession of this kind to be given, the inability to exercise anything like adequate control would inevitably lead to abuse. The Committee has passed requests for increase of duty on medicines which practically compensate chemists for the duty charged on the spirit they use. The rate on Excise spirit is 25s. per proof gallon, and in item 285 a, additional duty under the general Tariff on medicine and medicinal preparations equal to 25s. per proof is the effect of the Committee's request. The request, therefore, provides for a duty practically sufficient to compensatefor the Excise duty collected on the spirit used in the preparation of medicines. The substantial advantage granted te* chemists under this Tariff as compared with previous Tariffs will be evident from the fact that under the 1914 Tariff, as amended in September, 1918- that is, the Tariff in force at the time the present Tariff was introduced - chemists paid. 24s. per proof gallon on Excise spirit, while the duty on imported medicinal preparations containing spirit was based on a rate of 25s. per proof gallon. There was, therefore, a margin of ls. per proof gallon only in favour of the local manufacturer of medicines. Under the present Tariff, as modified by the Committee's requests, Excise duty on the spirit is 25s. per proof gallon, whereas the duty on imported spirituous medicines is ad valorem, 30 per cent., 35 per cent., and 40 per cent., with the addition of a rate of 20s. per proof gallon under the British preferential and 25s. per proof gallon under the general Tariff. As regards spirituous extracts and tinctures, there was a margin of ls. per proof gallon only under the 1914 Tariff, whereas under the present Tariff there is a margin of 5s. per proof gallon under the British preferential Tariff and of 6s. per proof gallon under the general Tariff. If Senator Payne's request is carried, we shall have to review what the Committee did last night in regard to the spirit contents of medicinal preparations and reduce them accordingly

Senator Payne - Could it be made applicable to registered friendly societies' dispensaries ?

Senator PEARCE - I shall have thematter investigated, but on the spur of the moment I cannot bind the Department. I deprecate opening the door to provide chemists with facilities for obtaining spirits at a lower rate for the reasons stated, and I trust the Committee will not support the request.

Senator Keating - Is the State Drug' Store in N/ew South Wales supplyingchemists ?

Senator PEARCE - No; only public hospitals.

Suggest corrections