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Wednesday, 11 August 1926

Senator PEARCE (Western AustraliaVicePresident of the Executive Council) . - I intervene in the debate merely to refer to two matters. One is the statement which was made .by Senator Duncan, that during the last election campaign the Government announced as p'art of its policy a proposal to further reduce taxation.

Senator Duncan - I did not say that.

Senator PEARCE - The honorable senator did say it; he was challenged to name the Minister who made the announcement. I give it a flat denial. Such a proposal was not contained in the policy speech, but the Government pointed out that it had reduced taxation on several occasions during the last Parliament.

Senator Duncan - And the inference was that similar action would be taken again.

Senator PEARCE - No promise was made that the Government would introduce measures for the reduction of taxation. It knew quite well that the liabilities which lay immediately ahead of it rendered it impossible to reduce taxation in any direction other than that which was involved by the transfer of certain fields of taxation to the States in return for the abolition of the per capita grant. I desire now to refer to one or two of the statements which were made by Senator Barwell. The first relates to the position of oil companies other than the AngloPersian Oil Company. The honorable senator quoted the profits which were made outside Australia by the AngloPersian Oil Company. They have no bearing on this case. Our sole concern is to see that the Commonwealth Oil Refineries Limited, which within Australia is the rival company to these other companies, is not making an undue profit. T am in a- position to say that it is not. But what is the attitude that has been adopted by the other companies? On the 30th January last, the Vacuum Oil Company and the Shell Oil Company increased their prices to their distributers by 1½d. a gallon. That could not' be justified on the ground that the price of petrol overseas had been increased. As a matter of fact, just about that time there was a decrease in the cost of petrol overseas. Therefore, that action of the two companies amounted to a barefaced attempt to tax the people of Australia to the extent of 1½d. a gallon. There was no public outcry, and no protest was made to this Parliament. Those two companies approached the Commonwealth Oil Refineries Limited and asked that it should fall into line by raising its price. Its experience had taught it that so soon as it could obtain the full throughput of the refinery in Australia it could make a profit, and it informed the Government that it had no intention of increasing its price, because there was no necessity to do so. The only protection which the Australian motor user .has is that afforded by this refinery, which produces from 8 per cent, to 10 per cent, of the motor spirit that is consumed in Australia., Those two companies have retained that additional charge right up to the present time. When the Government, in pursuance of the policy that it announced at the elections, proposed to place a duty of 2d. per gallon on petrol, what was the result? We have undoubted proof that those two companies organized an active campaign against the whole of our road proposals. They knew that it would be too barefaced to organize a campaign against merely the petrol duty.

Senator Sir Henry Barwell - Surely they would not influence the Labour Governments in New South Wales and South Australia !

Senator PEARCE - I do not say that they did. The attitude of those Governments is dictated by an entirely different motive. They want to raise and handle this revenue themselves. But public opinion has been organized at the direct request of these oil companies, through the. agents that they have scattered all over Australia. What is the present position? The tax is being paid, not by the motor users of Australia, but by the oil companies. The motor users have been paying what is really a tax of 1½d. a gallon imposed by these two companies since January last. Now that it is being diverted from the profits of the companies to the Treasury for use in the making of good roads throughout Australia, there is a squeal in opposition to the petrol tax.

Senator Sir Henry BARWELL - Does the Minister not think that the extra 2d. a gallon will be passed on to the .consumers ?

Senator PEARCE - It may be; but, so far, it has not been. There are very good reasons why they dare not do it.

Senator Grant - What are they ?

Senator PEARCE - One reason is the statement of the Government that if the tax is passed on, action will be taken to protect the motor users of Australia from further exploitation. We say that, without a shadow of justification, they have been exploited to the extent of l£d. a gallon since the 30th January last. From that date the Government has been examining the position apart altogether from its roads proposal, because it saw how dangerous it would be to leave Australia at the mercy of foreign oil companies. Its plans were partly laid to meet such a contingency in the future. The introduction of our roads proposals sprung the position a little earlier, because the companies have to hand back to the Treasury the money that they have been unjustifiably taking out of the pockets of the motor users of this country.

Senator Sir Henry Barwell - Is it not a fact that ls. 9d. a gallon is the price charged by both the Commonwealth Oil Refineries Limited and the other companies ?

Senator PEARCE - No. Up to the 30th January last, the same price was charged by all, but on that date the two companies to which I have referred raised their price by l$d. a gallon, and it has since been higher than that of the Commonwealth Oil Refineries Limited. Therefore, they have been exploiting the consumers of this country to that extent.

Senator Grant - Does the Minister intend honorable senators to understand that this extra tax is to be paid by the public and handed over by the companies to the Treasury?

Senator PEARCE - The tax is at present being paid by the oil companies out of the ill-gotten gains that they have accumulated. No 'amount of sophistry can explain away the facts that I have stated; they cannot be refuted. They are a justification for support being given to this tax by honorable senators, who will have the knowledge that the Government has made the necessary preparations and will go ahead with them, to see that the oil consumers of Australia are not exploited in the future as they have been in the past.

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