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Thursday, 20 November 1941

Senator KEANE - He will not be taxed if he makes losses.

Senator COOPER - I am pointing out that in the good year he will be taxed at this exorbitant rate, and will, .therefore, have no opportunity to make up the losses he incurs in had years. That means that the bulk of his profit above 6 per cent, will be taken from him. Thus, over a period of four years he will show an average annual profit of only 1$ per cent. Obviously, in view of the precarious nature of the industry, that is too low a rate of profit, especially as he may be paying 6 per cent, on borrowed money.

After allowing for the revenue to he raised by taxation and borrowings an amount of £7.5,000,000 remains to be raised. Approximately £3,000,000 of that sum is to be raised through the sales tax. As I have already said, that is the Government's responsibility. However, I have always maintained that the sales tax places an unfair burden upon the family man. After raising £S,000,Q00 by sales tax, the sum of £72,000,000 must still be raised under this budget. It is at this point that- the foundation of this budget differs entirely from that of the Eadden budget. The Fadden budget contained concrete proposals by which it was intended to raise that amount However, this budget is very vague in that respect. This Government has given no indication as to how it will raise that £72,000,000. We are told that it will be forthcoming from loans and credits, al though we have already budgeted to raise £66,000,000 in that way. The Prime Minister (Mr. Curtin) has suggested that the people on the lower levels of income will provide it voluntarily through the purchase of war savings certificates or by subscriptions to loans. That is very vague.

We have been given no surety that that amount will be provided. As it is so large a sum, however, definite proposals should be placed before Parliament to show us how' the Government intends to raise it. I suggest that it could easily be raised out of the increased wages bill which, from figures I have secured, increased in 1941-42 by from £140,000,000 to £150,000,000 above the pre-war -level. That is a huge reservoir of money from which a considerable proportion of this amount of £72,000,000 could be secured. On this point I bring to the notice of honorable senators the following report of a statement made by the Premier of Queensland, Mr. Forgan Smith, when speaking at the recent annual federal congress of the Returned Soldiers League held in Brisbane : - " Wc arc making conditions too profitable for eligible men to enlist," said the Premier of Queensland, Mr. Forgan Smith, at the opening of the 26th annual Federal congress of the Returned Soldiers' League. " There is more money- in circulation in Australia to-day than ever before," he added. "The whole nation will soon have to be mobilised on a war footing. We must bo as ruthless fis the .enemy."

The congress unanimously carried n motion urging the Federal Government to conscript all industry, man-.power, and wealth, and use them for the war effort.

That is the view of a Labour, premier. I suggest that the Government might make conditions less profitable for men eligible to enlist whilst, at the same time, providing more money for the soldiers. I hope that the Prime Minister's expectations that a large proportion of the £72,000,000 will be forthcoming in voluntary contributions. | Extension of time granted.'] The country urgently needs money. I hope that the great majority of our people by the end of this year or *by the beginning of next year will have realized how critical our position is, and that it will be brought home to them that they must divert their expenditure on nonessential civil goods to war loan3. In order Jo overcome this difficulty the Fadden Government proposed -to inaugurate a compulsory loans scheme. Personally, I think that that is the only way in which we can obtain revenue from the excess amount of money that is now in circulation. We must realize that we are at war.

In a time of peace industry could be speeded up for the production of additional commodities the purchase of which would absorb that excess spending power and restore general financial equilibrium in the community, but as we are now asking for a curtailment of civil expenditure that money cannot be expended on the purchase of commodities. For that reason I believe that the Government must eventually resort to compulsion by way of additional taxes or forced loans, in order to withdraw that excess amount of money from circulation. Party politics cannot justify a decision not to ask people earning less than £1,500 per year to give more in direct taxation. Portion of the £72,000,000 for which the budget does not provide should be spread in a sliding scale over all wage-earners, including the large group of workers earning under £400 per year, and who earn about 70 per cent, of the total private income of Australia, which amounts to £560,000,000. If the Government had decided to increase taxes on those incomes it would . not only have secured a considerable proportion of the amount it must still raise, but would also have found that the majority of the people concerned would very gladly make a contribution to the national revenue in that way, if only for the reason that all sections of the community were being asked to do likewise

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