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Wednesday, 27 May 1942

Mr BARNARD (Bass) . - I do not propose to discuss the contention that the bill is ultra, vires the Constitution, because frankly, I am not competent to speak upon the legal aspect. However, I shall vote for the bill, for two reasons. First, I support the Government which has introduced the. measure. Secondly, I regard the legislation as the only practical and logical step for marshalling the whole of our financial resources for a total war effort. It is not unusual for me to disagree with the' views of the honorable member for Wakefield (Mr. Duncan-

Hughes), and this occasion is no exception. In my opinion, his concluding remarks to quite a reasoned statement of his attitude did not reflect credit on him. Any one who claims a monopoly of loyalty to Great Britain and implies that those who do not see eye to eye with him are disloyal is narrow-minded, and unfair to other honorable ' members, who, in their individual capacities, are playing their part in the war effort.

Mr Duncan-Hughes - If the Labour party cannot co-operate with us, how can it expect to co-operate with people whom it has never seen?

Mr BARNARD - I remind the honorable member for Wakefield that when the Labour party was in opposition, it co-operated with the Menzies and Fadden governments until the time came when it could not support certain financial proposals which the Government of the day regarded as vital. That is a fair and reasoned attitude. On a number of occasions the Labour party, when in opposition, extended valuable assistance to the previous governments. For the honorable member for Wakefield to declare that we are not loyal to Great Britain is most unfair.

Mr Duncan-Hughes - I did not say that.

Mr BARNARD - Whilst I do not desire to misrepresent the honorable member, that was my interpretation of his remarks.

The Treasurer, when introducing this legislation, gave a clear exposition of the financial problems of the Government, and the maze of Commonwealth and State taxation. To-day, the Prime Minister (Mr. Curtin) and the Leader of the Opposition (Mr. Fadden) dealt in very temperate language with various features of the bill. The speech of the Prime Minister was logical and reasoned, and he kept the discussion on a high plane. Unfortunately, his example was not followed by the honorable member for Boothby (Dr. Price), who normally makes a reasonable - contribution to the deliberations of this chamber. This evening-? he resorted to -tactics to which ' I do not subscribe. They did not do him justice, or make a valuable contribution to the debate. When the honorable member was on the hustings at the

Boothby by-election, the key-note of his policy was "Win the War", and he advocated that the whole resources of Australia should be placed at the* disposal of the Commonwealth.

Dr PRICE (BOOTHBY, SOUTH AUSTRALIA) - I also advocated the formation of a national government, which the Labour party has repeatedly rejected.

Mr BARNARD - The attitude which the honorable member adopted this evening was most parochial.

Mr Archie Cameron - Rubbish 1 Under this legislation, the profligate States will receive greater compensation than the prudent States.

Mr chifley - A " barker " for Bar~ ker.

Mr BARNARD - I agree. Numerous people in Tasmania and on the mainland have asked me to declare my atti'tude to the proposal for the introduction of a uniform income tax. Without exception, they have supported the principle, believing that in war-time the Commonwealth should have first call on the public purse.

Sir Frederick Stewart - Tasmania has been granted an additional £77,01)0.

Mr BARNARD - It is true that .the Premier of Tasmania asked the Federal Treasurer to increase the allocation that the Commonwealth proposes to make as compensation to that State. However, when those people asked me to declare my attitude, the amount of compensation payable lo Tasmania bad not been made public. I have not visited Tasmania for five or six weeks, and that was some time before this bill was introduced. People regard the winning of the war as para mount. The people know that the Commonwealth Government in the present circumstances should have first call on their purses. Another reason why some people support the principle of uniform taxation is probably selfish, but it is shared by those who live in one State and draw their incomes from several States. They dislike the irritation and difficulty involved in making out different returns of income for different States. Whether the reason be selfish or not it is nonetheless a reason some people have for supporting a uniform tax.

Mr Spender - They may be surprised when they see the results, because they will be taxed higher, especially if they derive their incomes from a number of States.

Mr BARNARD - I should say that that would depend on their incomes. I do not think that it is . sufficiently appreciated that it is proposed to revert to the present system twelve months after the war ends, and that its only purpose is to ensure that the Commonwealth Government shall be able to raise the money necessary for the prosecution of the war. which is the real objective. In spite of the fact that some people may have been buying more than their needs there is no real objection amongst the people generally to the payment of whatever additional taxes are needed to provide the resources which will help to achieve that objective.

Among the honorable members who have expressed opposition to the Government's proposals are the honorable member for Boothby (Dr. Price), the honorable member for Wakefield (Mr. DuncanHughes), and the honorable member for Barker (Mr. Archie Cameron), all good South Australians. I should have liked to hear from them and other opponents of this measure how otherwise the extra £15,000,000 which the Treasurer anticipates receiving as the result of it would be raised.

Mri Archie Cameron. - Before the Labour party had to take on the job of government we heard a lot from its supporters about raising money without, imposing taxes.

Mr BARNARD - The honorable member does not say that seriously.

Mr Archie Cameron - Indeed I do. Labour members when in Opposition talked all the social credit in the world.

Mr BARNARD - It is difficult t.i know when the honorable member is being serious. It is perfectly true that more money could be raised and used than has been raised by other than taxes. When the honorable member for Warringah (Mr. Spender) was Treasurer he wrote an article on inflation which he concluded by saying, "Inflation, forget it!".

Mr Spender - I guarantee that the honorable member cannot produce that article.

Mr BARNARD - Perhaps not tonight, but later, yes. We have heard a lot from the honorable' member for Wakefield about the way In which the weaker States have been impoverished under federation as the result of the loss of customs revenue and so on. T agree with much of what he said in that direction. It is unquestionable that in all federations the less populous States suffer, whilst the more strongly populated States, prosper. That is as true of the United States of America as it is of Australia. It seems to be the inevitable result of a federal system. It is also true, however, that various efforts have been made to compensate the weaker members of federal unions. I concede that those efforts have not been entirely successful, but a genuine effort has been made to make adjustments in this country. I do not think that the resurrection of the Interstate Commission would have beneficial results in the poorer States of the Commonwealth, but the Commonwealth Grants Commission has done and is doing an excellent job of work in helping to meet the deficiencies of Western Australia, South Australia and Tasmania. I t has not been able to do everything that they desire, because of certain limitations imposed upon it, but, at the same time, its efforts to' bridge the gap which exists between the conditions in those States and the conditions in the other States have had a fair measure of success. Under this legislation that commission will have greater powers and will be able to deal with many of the difficulties mentioned by the honorable member for Wakefield. For instance, provision is made for it to inquire at the request of the States into injustices, ren or supposed, imposed on them in respect of the compensation payable by the Commonwealth under the States Grants (Income Tax Reimbursement) Bill. A1 this stage, it seems to me, very little more provision could be made than is made to meet the difficulties that can be anticipated. If with the passage of time weaknesses be disclosed, the Commonwealth Grants Commission, or some other body, nan be. empowered to investigate the matter. There is no need to anticipate great difficulties. It is wise to cross our bridge* as wo come to them. The bridge we have to cross now is the war. That is our first consideration.

If wo are to win the war we must have sufficient resources of man-power and money. We have to marshal our whole resources in such a way that the Commonwealth Government will be able, to obtain whatever money it needs. When the war has been won will be the time to talk about our own difficulties. If we do not win, there will be no question for us to decide as to States, State boundaries. State revenues or State taxation authorities, or anything of that kind. All decisions will be with Nippon. I give my unqualified support to the legislation. It is practical and logical and the most effective way of prosecuting the war to a successful end.

Debate (on motion by Mr. Menzies) adjourned.


Bill returned from the Senate with requests and amendments.

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