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Thursday, 10 December 1998
Page: 1825

Ms BAILEY (10:40 AM) —If we were simply to listen to all those members of the opposition who have taken part in this debate on A New Tax System (Goods and Services Tax) Bill 1998 and related bills, we could be forgiven for thinking that this debate was simply about the introduction of a GST. I am very pleased to have this opportunity to speak in this debate because this is a debate about introducing a new tax system. It is about introducing a new tax system to get rid of an outdated, outmoded tax system designed in the 1930s. We are now about to move into the next century and yet the opposition would have every Australian individual, business and exporter working with a tax system that is completely and utterly outmoded. It is for those reasons that I am very pleased to have this opportunity to speak in this debate, which is about the introduction at long last of a new tax system.

I would like to talk about the need to introduce this new tax system. The most unfair tax in our tax system today surely has to be the wholesale sales tax. This is a tax that builds into every layer of production, process, transport and marketing of our goods produced in this country. It is a hidden and very unfair tax. The average consumer has only to walk down the street of their local shopping centre and walk into their supermarket, newsagent, electrical goods store or any of the variety of stores there to find that hundreds and hundreds of normal everyday items have concealed within their prices the wholesale sales tax. It is an arbitrary tax. There are seven different rates of this tax. It applies arbitrarily to a range of goods. As I said, it compounds into the cost of the good.

The losers from this wholesale sales tax are, firstly, the Australian consumers. They are the ones who are duped by this most iniquitous tax. But our small businesses are also disadvantaged by this tax and a whole range of other taxes which we are going to get rid of in this new tax system. Because of these unfair taxes those businesses are made un competitive. As several members from the government have pointed out, the exporters in our country are also disadvantaged. It is very hard to compete in the global international markets. I can name many exporters from within my own electorate who have fought tooth and nail to gain entry into some of these important niche exporter markets—especially some of our producers in aquaculture, a new industry for many of our primary producers. Many exporters have really had to fight hard to get a foot into some of these niche markets, and they are being disadvantaged.

I have heard speeches in this place by every member on both sides of this chamber exhorting our exporters to get out there and do better. But, by opposing the introduction of this tax, every member of the opposition is saying to our exporters, `We are going to tie one hand behind your back. We are going to make you uncompetitive. We are going to disadvantage you against all of the other countries that are your competitors in that international marketplace.' That is what every member of the opposition is doing—disadvantaging our exporters and making them uncompetitive.

As well as that, every member of the opposition who has stood up in this place and has opposed this legislation is disadvantaging all of our hardworking people out there who are trying to earn a living. As an illustration of this, recently I was in a small town called Kinglake in my electorate where I was approached by a man who wanted to complain bitterly about the tax system. He was an average worker trying to support a wife and three children. They were a single income family and he told me that his income could not support that family. They could not even afford to send the children off on school camps. He nominated the reason why he was falling behind in society as being that he was losing so much of his salary in tax. He, like so many others, made a point of coming up to me and saying, `It is not worth our while to work any overtime because we simply lose it in tax.'

In the brief time that I have available today I have given just some of the reasons why this new tax system is so needed. It is needed for our individual workers, it is needed for our small business people and it is needed for our exporters. This government is prepared to introduce this new tax system.

The last speaker, the member for Prospect, was talking about the compensation that is contained within this new tax system. Let us have a look at some of this compensation. The first method of compensation to all Australians under the new tax system will be to ensure that 81 per cent of all of our taxpayers will never pay more than 30 cents in the dollar in tax. That has to be one of the best incentives of all time. As well as that, we are increasing and making far more simple the family assistance within this legislation. For example, we are doubling the extra $1,000 tax-free threshold for each dependent child under the family tax initiative to $2,000, which is the equivalent of $140 per year per child. These are real benefits to families. We are doubling the extra $2,500 tax-free threshold for single income families with a dependent child under the age of five. That $5,000 tax-free threshold means $350 per year per family. These are real initiatives.

There are others, including an increase in the maximum assistance for child care for low income families by $7.50 a week, an increase in social security benefits and an up-front increase in allowances by four per cent. This means that those receiving any form of income support are going to have that increase long before the GST is introduced. The assets test for pensioners is being increased by 2.5 per cent. We are making sure, importantly, that all of our citizens who are receiving income support pensions are always going to be ahead by 1.5 per cent.

In stark contrast to what the opposition ever did in government, we are making sure that those on income support are always 1.5 per cent ahead. They are not going to be in catch-up mode. By the stance the opposition are taking with regard to this legislation, they are denying ordinary Australians the advantage of those tax cuts. They are denying them assistance to families. They are denying small businesses the chance to be competitive and to get ahead. They are denying our exporters the chance to be competitive.

Mr DEPUTY SPEAKER (Mr Jenkins) —Order! The time allotted for the second reading of the bill has expired. The question is that the words proposed to be omitted stand part of the question.