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Wednesday, 3 May 1961

Mr McMAHON (Lowe) (Minister for Labour and National Service and Acting Attorney-General) . - by leave - I move -

That the bill be now read a second time.

I propose to deal with this bill and the complementary States Grants (Coal Mining Industry Long Service Leave) Bill 1961 together. They, along with an Excise Tariff Proposal which I will be commending to the Committee of Ways and Means, give effect to the Government's intention announced earlier this year to encourage the development of coal export markets and at the same time make a practical contribution to reducing costs in the Australian coal-mining industry.

The Government's decision was taken against the background of a review of the revenue collected from the present coal excise against the current and likely expenditures chargeable against those revenues. The conclusion was reached that the current rate of excise, namely, 5d. per ton, could safely be reduced. In giving effect to this decision the Government considered two possible courses of action - first, to make some reduction in the excise on all coal produced, and, secondly, to remove completely the excise on coal exported, at the same time making a smaller reduction in the excise on coal for home consumption. In choosing the latter course the Government has acted consistently with its policy of encouraging the development of export markets and has given a lead in the direction of reducing costs wherever possible. The amendments proposed in the Coal Excise Bill now before the House will remove from licensed coal-producers the liability to pay excise duty on coal exported and provide administrative machinery whereby coal maybe removed from mines for export free of duty. The bill also contains some minor drafting amendments.

The provisions of this bill will cover most export coal. There are, however, cases in which coal is not exported direct from mines licensed under the Coal Excise Act. To meet this situation and to provide for the case of State-owned coal, which is not excisable, there is the complementary bill I have mentioned. In some cases duty-paid coal from a number of mines is mixed by merchants prior to export. Where this occurs, the cost to the merchants includes an element to cover excise paid by the producer and it is therefore necessary to reimburse him from the coal excise revenue an amount equivalent to the excise already paid on the coal to be exported. There may also be instances in which State-produced coal is blended with excisable coal before export. Although State coal is not excisable, the States, by agreement with the Commonwealth, pay an amount equivalent to the excise on each ton of State-owned coal produced. A reimbursement arrangement similar to the one which will operate in the case of blended coal from privately-owned mines is therefore being provided.

As to the rate of excise duty which will apply to home-consumed coal, the Government has decided that it should be reduced from the present rate of 5d. per ton by 1d. per ton. At a later stage I shall move in the Committee of Ways and Means an Excise Tariff Proposal fixing the excise duty at 4d. per ton.

It is proposed that these bills and the tariff proposal will operate from 1st June of this year. This date of operation has been fixed to allow time for the promulgation of regulations and the settlement of administrative matters in the meantime.

I commend the bills to the House.

Debate (on motion by Mr. E. James Harrison) adjourned.

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