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Tuesday, 29 November 1960

Mr BARNES (McPherson) .- As the representative of a rural electorate, I am very glad to have the opportunity of supporting this bill. Of itself, a bill to increase the sales tax on motor vehicles is not desirable, but we have to consider this measure is but one of a number which are designed o bring stability to our economy, and I congratulate the Treasurer upon this very statesmanlike attempt to do what is really required to bring balance to our economy. Every one must realize that extreme boom conditions in metropolitan areas at a time when country areas are experiencing difficulties are not desirable.

It has been very interesting to hear the points put forward by members of the Labour Party. It is obvious that they are laving difficulty in finding a sound reason for opposing this measure. They condemn he Government for our flexible economy, out 1 point out that it is a tremendous con.trast to the strait-jacket economy we saw when the Labour Party was last in office. The honorable member for Macquarie (Mr. Luchetti) said that the ordinary people should be in a position to afford to buy a rooter car. I remind him that when Labour was last in office the ordinary people could 1Ot afford to buy cars. One disadvantage

Df the boom, if it can be called a disadvantage, is that it is expanding too rapidly and must be slowed down. This and related measures are designed to do that.

Honorable members opposite have suggested that the country people will suffer as a result of this bill. Perhaps they will in one way. I have not the slightest doubt that sales of motor cars in city areas will be reduced but, in the long Tun, city residents must benefit from the overall stability of the economy which this bill is designed to bring about. On the other hand, however, dealers in country areas may experience a greater depression in sales than will be felt by metropolitan agents, but I point out one important factor which the Opposition ignored. No doubt honorable members have noted that not one member of the Labour Party has mentioned that country people will still be able to buy utility trucks without payment of increased sales tax. Another important factor is that our newspapers contain advertisements to the effect that some dealers are absorbing the increase themselves. This means that the person who really wants a motor car may buy one from these dealers without being required to pay additional sales tax.

But I should like the Treasurer to look into one matter. It has come to my knowledge that some finance companies have notified dealers in small country towns that they are no longer prepared to finance the purchase of motor cars. That notification has come so quickly and so uniformly from a number of finance companies that I suspect it is an organized move on the part of those companies, and I appeal to the Treasurer to investigate the possibility of making finance available through the Commonwealth Bank in those cases in which the companies who hitherto financed such business have refused to advance money.

It has been suggested that these sales tax measures will create unemployment in the motor industry, and honorable members opposite have suggested that restrictions be re-imposed upon the importation of motor cars. I remind those honorable members that the number of finished motor vehicles imported is negligible. In the main, components are imported and then assembled in Australia, and if it proposes that the importation of these components be restricted, the Labour Party is advocating a policy which would lead to unemployment in the industry. In reply to a question by a member of the Opposition to-day the Minister for Labour and National Service (Mr. McMahon) mentioned various areas where there was unemployment, or where it was anticipated, and he gave an undertaking that the men concerned would be reemployed. As he indicated in his answer to the question, he had no doubt about the outcome. I believe that we could not go much further as we were going with this boom economy.

As I have said, this is only one part of the economic measures designed by the Government to curtail excessive spending in certain directions. We all realize, particularly people from the country, how much should be spent on our roads, hospitals, schools and institutions which are so necessary in our rapidly developing economy. If we were not prepared to take measures to divert some of these funds into Commonwealth loans, eventually to be used in the proper development of Australia, this Government would be failing in its duty to put our economy on a stable footing.

Mr Uren - The Chifley Government took other measures.

Mr BARNES - The honorable member for Reid interjects that the Chifley Government took other measures. The people of Australia remember those measures so well that at every election this Government comes back stronger than ever. It would be tragic if the people of Australia did forget what happened under the previous Labour Administration.

Members of the Opposition speak about cars for Australians. In the days of the Chifley Government we could not buy cars. If we were fortunate enough to get one, we could not buy petrol to run it. We must remember, also, that during the 1949 election campaign the Labour Party declared that it was absolutely impossible to lift the restrictions on the sale of petrol. But as soon as the Menzies-Fadden Government was returned to power the first thing it did was to lift those restrictions. Again, we remember the efforts of the Opposition to nationalize the banks. In fact, I believe the Opposition is jealous of our present flexible economy because it shows up the Opposition's criticism of the measures which have been taken to control the economy in the ten years during which this Government has been in power. Members of the Opposition have spoken of horror budgets and all sorts of things; but in every instance we have kept our economy booming and advancing.

The Opposition is condemning this measure. The honorable member for Macquarie (Mr. Luchetti) asked what this Government will do with the tremendously increased revenue which it will receive from the imposition of increased sales tax. But in the next breath he said that the sale of cars in Australia will be completely depressed. I point out that a drop of 20 per cent, in the sale of cars in Australia will simply maintain revenue at its present level. So, what does the honorable member mean when he refers to the tremendous revenue that the Government will receive from sales tax? He refutes his own argument. I have not much more to add. After all, the people of Australia want a stable economy. We hear a lot of propaganda from the motor people. All honorable members have been circularized with pamphlets headed, " Stop the car tax ". I have one in my hand.

Mr Cope - Read it out.

Mr BARNES - I am not going to read it out. These people are good salesmen, and they are against anything that interferes with the sale of cars. But we know very well, as members of the Opposition have pointed out on many occasions, that these people have made huge profits. Honorable members opposite have quoted the balancesheets of motor companies which disclose huge profits and they cannot argue that a slight recession in those profits will not be to the ultimate benefit of not only those organizations but also to the Australian economy as a whole.

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