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Wednesday, 11 October 1972
Page: 1463


Senator BYRNE (Queensland) - Mr Deputy President,I move the following amendment to the motion before the chamber:

At the end of motion add - but the Senate expresses the view that the Government should consider as soon as possible the complete elimination of Federal estate duty'.

Copies of the amendment have been circulated to honourable senators, but unfortunately no other member of my Party is present at the moment to second the amendment.


Senator Townley - I formally second the amendment.


Senator BYRNE - I have been a member of this chamber for some years and, to my recollection, the legislation governing the imposition of Federal estate duty has been amended 3 times. The Bill presently before the Senate is at least the third amending measure; there may have been others. The first amendment I recall was the one referred to by Senator Lawrie when relief was afforded from the duplicated imposition of estate duty in the case of quick successions; there was some alleviation of that position. A year or so ago there was an alleviation of the imposition of Federal estate duty by lifting the level of exemption and by other types of concessions. The Bill now before the chamber is of the same character. 1 do not propose tonight to go into tha whole matter of the justification for the elimination of Federal estate duty, but I do say that the Senate is indebted to Senator Lawrie, who has just resumed his seat and who is the Chairman of the Standing Committee on Finance and Government Operations to which this matter has been referred in these terms:

The effects of Estate and life duties on the public revenues and the economic circumstances of individuals and communities, and the social consequences of such duties.

That Committee has not yet presented its report. However, Senator Lawrie as a result of information which has come to him in public hearings of the Committee has been able to give the Senate the benefit of certain inferences that can be drawn as to the effects of the incidence of this duty, the effects of individual cases of hardship which are involved, the general oppression implicit in the imposition of this duty, the economic consequences of it generally and the effect it has on rural industries and on rural settlement, on individual 'lives, on domestic circumstances and on the breakup of justifiably accumulated family estates. The Senate, I think, could well rest upon the detailed information which Senator Lawrie has been able to furnish to it from the evidence which has been presented to his Committee.

When a similar Bill to the one now before the Senate was introduced in this chamber about 2 years ago - again when the level of exemption was lifted - I moved an amendment on behalf of my Party. A. similar amendment was moved in relation to, I think, the Budget when, among other propositions, this amendment was advanced on the motion for the second reading of the Appropriation Bill. On the first occasion, to the motion for the third reading of the Bill 1 moved an amendment which was in identical terms to that which has now been moved and circulated to honourable senators.


Senator Young - You had some support, too.


Senator BYRNE - Yes. On that occasion I was supported by a number of honourable senators. Our amendment was supported by a number of members of the Liberal Party; by all members of the Country Party except a Country Party Minister, but 1 must say that since he was a member of the Cabinet he perhaps had little alternative but to support his Government's legislation; by one Independent senator, if 1 remember correctly: and by all members of my own Party of course. But it was totally opposed by all members of the official Opposition, and was defeated.


Senator Milliner - It was a pious resolution.


Senator BYRNE - Senator Milliner says that it was a pious resolution. It was to be an expression of opinion by this chamber, and I do not regard a formal expression of opinion by this chamber as being merely a pious resolution. It must be interpreted as the opinion of one chamber of the legislature formally presented to the government as expessing the view of the representatives of the 6 States on a matter of very great importance. I must accept the resistance of the Australian Labor Party to our proposal for the total elimination of estate duly as an expression of opinion by that Party, and as an expression of the policy of that Party. I presume that that policy remains the same today and I would therefore be gratified if in the course of this debate Opposition senators would indicate whether they still resist the elimination of Federal estate duty or whether that policy has been changed or the attitule of their Party has been altered and they will now support our amendment as, I am sure, many honourable sentors on the Government side - I hope, in increasing numbers - will do.

The fact that on 2 occasions in the last 2 or 3 years it has been necessary to represent this principal Act and to amend it by granting further exemptions is an indication of 2 things. Firstly, it is an indication that due to the change in the economic climate of this country an air of unreality is now being injected into the valuation of estates, attracting then the imposition in harsh terms of Federal estate duty, and this is something that has to be constantly rectified. That has been done before and is being done again. That in itself indicates a totally unsatisfactory situation and one which surely must ultimately be eliminated by the abandonment of the tax. The second thing that is indicated is, of course, the growing concern that obviously is being expessed in the necessity, firstly, to relieve a matter such as the double incidence and then to ameliorate the level of incidence by lifting the. level of exemption. That must indicate a growing concern and a growing acknowledgment and appreciation that this lax by its nature is an unsatisfactory and unjustifiable tax and one which, if it cannot be eliminated immediately, must be eliminated gradually until we reach the process of its final elimination.

Those are the conclusions I draw from the presentation and re-presentation of the principal Act with amendments on 3 occasions to my knowledge, and probably more, as I may have discovered, if I had researched it in that depth. It is important that the Parliament should express its view on this matter, and it is important that the Senate should express its firm view in relation to this tax insofar as it is imposed under Federal law. That is why I cannot for a moment accept that a formal resolution of this chamber is merely a resolution which is passed here and dies here. A resolution of this chamber surely must come into the cognisance of the Government and must have at least some persuasive effect on the Government in regard to its acceptance when the opportunity presents itself. On the last occasion on which a resolution was moved in these terms Senator Prowse moved an alternative resolution to the effect that the Government should take this matter into budgetary consideration, the Budget of that year then being pending. That resolution was supported by my Party, by all members of the Country Party with the exception of a Country Party Minister and by a number of members of the Liberal Party, but again was opposed by the Australian Labor Party. Of course, circumstances change insofar as that Budget has passed and the current Budget has been formulated; therefore to refer to a budgetary situation now in this resolution would be unreal. What the Democratic Labor Party does, therefore, is seeks a firm expression of parliamentary opinion on this chamber to the effect that the chamber, having considered the matter, is averse to the continued imposition of the tax and commends to the Government early consideration of its total abolition.

The fact that the Senate by resolution - if 1 remember correctly, by unanimous resolution - referred the matter to the Standing Committee on Finance and Government Operations, of which Senator Lawrie is the Chairman, surely means that the Senate must have expressed its concern. We are merely asking that in a formal way that concern be clearly and unequivocably expressed tonight. I hope that the Senate therefore will support our amendment. It has been suggested that there may be other propositions for further partial alleviation of the present level of imposition by one method or another or by the application of one formula or another. The Democratic Labor Party cannot accept such specific proposition insofar as they would represent a precise amendment to a Bill which is part of the budgetary situation, and that would amount to rejection of the Budget. We do not think that would be appropriate. Therefore we think the best that can be done at this stage - and we do it as firmly, as clearly, as unequivocally and as persuasively as we can - is to present this amendment and trust that it will receive the unanimous support of honourable senators. lt is not necessary for this chamber tonight to canvass in detail all the injustices and all individual hardships of estate duty or to canvass the merits of the case for the abolition of Federal estate duty. We do know that, today, the Commonwealth has complete control over the major sources of revenue in this country. Those sources are the imposition of direct, taxation, of duties of customs and excise, and of sales tax. The States are left with ancillary methods of raising finance. One of those methods to which the States resort is the imposition of estate duty, probate duty or succession duty.

We know that whatever our views may be on the principle of estate duty, constitutionally the most that we can do in this place is to direct our minds to the elimination of that duty insofar as it is imposed under Federal constitutional power. Whatever we might think of the continued imposition of that duty by the States, that is a matter for them. All we can do is to go as far as we are entitled to do constitutionally. This amendment purports to do that.


Senator Cotton - It is not my wish to interrupt the flow of the honourable senator's thoughts. But I think it may be easier for me now to offer an observation than to make a long speech in closing the second reading debate. Has the honourable senator taken into account in his calculations - I am sure that he has - the problem that a reduction in Commonwealth estate duty might lead to an increase in the level of such duty imposed by the States?


Senator BYRNE - I was just going to canvass that point.


Senator Cotton - I am glad that you are because what we are wishing to listen to is the force of argument for that case.


Senator BYRNE - I think that the point made by the Minister is very appropriately and most relevantly raised. He is' asserting that, insofar as the Commonwealth may vacate the field of this duty, this action may be an incentive to the States, with a wider field of revenue then available, to impose this duty in their own sphere at an increasingly high level. We think that that would be a most unacceptable alternative because that is not the purport of our amendment. It is not the intention which is implicit in our approach. We think that the duty in principle and by its very nature is indefensible whether it is imposed by the Commonwealth or by the States. Therefore, in our approach to it we would say that we wish to eliminate it as far as we can in the Federal sphere under constitutional powers. We would ask the States similarly to adopt this principle. We wouk request that insofar as their revenue necessarily will be affected, alternative sources of revenue might be discovered by them or for them; otherwise the whole of the exercise would be nugatory and of little value and effect.

What we challenge here - it was very well put by Senator Lawrie - is the principle implicit in this opposition, that is, the inequities which inescapably accompany it and the injustices which inescapably are imposed by it. These are the things that we want to eliminate. I mention the disturbance of families that have devoted themselves for years to the building up of only one asset which basically is land. Everything has been sacrificed to the retention of the homestead and some producing land surrounding the homestead. That becomes virtually the sole asset of the family and the sole asset which is passed on in succession. The moment the succession arises, not sufficient money is available to meet the estate duties which are imposed under valuation of the property which may be unreal in terms of its productive capacity. The estate must be sold; the assets have to be distributed; a whole domestic family unit is disturbed. The succession is no longer inviolate but is destroyed for all time. We think not only that this is an injustice but also that it is socially undesirable. It is towards the elimination of this situation and for this purpose that we have moved this amendment.

The Senate discussed this matter as recently as 18 months or 2 years ago. We spoke on it then and, before that, on many occasions we have presented our case. We think that it is a case which is now finding increasingly common acceptance. We think that it does find acceptance in the Government, which has the responsibility for discovering the revenue which must be discovered in order to finance the expenditure of government. We do feel that the Government giving these constitutional alleviations is now sensitive to the undesirability of the retention of this tax. A firm expression by this House of the Parliament may well persuade the Government that a final effort should be made to discover an alternative source of revenue and to eliminate this highly undesirable means of raising it by way of Federal estate succession duty.

For those reasons, we commend the amendment to all honourable senators. I feel that on this occasion we shall obtain increased voting support from the Government benches beyond those members who have supported us on previous occasions and who supported the amendment on the occasion when you, Mr Deputy President, moved an amendment as an alternative to the one that we had proposed. Your amendment was virtually in the same terms, with some minor qualifications. But particularly do I hope on this occasion that members of the Opposition will support our programme for the elimination of estate duty. We do hope that we will obtain their support on this occasion because, if we do, it will be the first occasion on which a House of this Parliament has come out clearly and without equivocation in appealing to the Government on behalf of the people involved - and so unjustly involved - to eliminate this imposition on their life of thrift, sacrifice and saving.

Therefore, with considerable enthusiasm and, I trust, with equal hope, we 'commend this amendment to all honourable senators. We trust that its fate on this occasion will be different from that which it met on previous occasions. Allowing perhaps that amendments of this kind may- not be able to be accepted in the disposition of members of the Cabinet, although I could not see why, at least those who may not in some way be bound by any Cabinet loyalty will find it possible to support the amendment and to let if not a unanimous at least a substantial vote flow from this chamber, stating the principle of elimination by supporting the terms of the amendment. For those reasons, I commend the amendment to all honourable senators. I do hope that the amendment will meet the fate and the outcome that I contemplate arid for which I so fondly and eagerly hope.







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