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Monday, 6 December 1999
Page: 12820

Mr HOWARD (Prime Minister) (3:13 PM) —The week before last, the Leader of the Opposition questioned me about a phone call I had had on Perth radio from Shirley, and I said at that time that I had not heard from her. But the ever vigilant Prime Minister's office got in touch with her. We did find the lady and we had a very pleasant discussion with her. The facts are as follows—and I thought, as the Leader of the Opposition asked me the question, the House, particularly his own followers, would be interested to hear the answer.

The details were provided to my office by the lady. The essence of her concern, as stated to us, is that she was quoted a GST-inclusive price of $5,500 for a basic prepaid funeral. She was concerned that this price was excessive as a relative of hers had been quoted a price elsewhere which was substantially lower. I am advised that she has since spoken to others and purchased a prepaid funeral which suits her requirements for $3,500. I would remind the House that the government has enhanced the powers of the ACCC so that businesses that engage in any price exploitation in the lead-up to the introduction of the new system will be liable to penalties of up to $10 million for corporations and $500,000 for individuals.

I should also inform the House—parallel with this but not arising out of this—that there were discussions between the Australian Funeral Directors Association and the government. The government proposes to amend the legislation applying to the GST transitional rules for prepaid funerals. The effect of the amendment is to make a prepaid funeral purchased before 1 December 1999 and fully paid before the year 2005 GST free no matter when the funeral occurs. However, a GST will apply to prepaid funerals purchased after 1 December 1999, and the funeral operator will of course be required to pay a refund if the funeral takes place before 1 July 2000.

I also want to add to an answer I gave to the Manager of Opposition Business. The Manager of Opposition Business asked me a question about sales tax on cars. I did state the obvious—that if you cut the tax on cars they become cheaper—although the shadow minister does not accept that. I was handed a document that contains the following statement:

. . . the recession has had a severe effect on motor vehicle sales.

From tomorrow the sales tax on new cars currently subject to the 20 per cent rate will be permanently lowered to 15 per cent—

that did not actually turn out to be the case; it was not very permanent—

a saving on a new Commodore or Falcon of around $800.

With cheaper cars we will drive newer cars, which is good for the environment, good for road safety, and good for one of our most important industries.

At least the author of those words thought that if you cut the tax you got a cheaper car—that is, P.J. Keating's One Nation statement of 26 February 1992. As a footnote, it was not very permanent. He took it back to 22 per cent after the 1993 election.