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Tuesday, 29 September 1942

Mr CHIFLEY (Macquarie) (Treasurer) . - The more I hear of this subject the more I realize what a difficult problem it is. A close examination was made of all alternatives, particularly in respect of those who serve at operational sta tions, whose case was raised by the honorable member for Warringah (Mr. Spender).

Mr Spender - Operational units, not stations.

Mr CHIFLEY - No one can tell what officially becomes an operational unit.

Mr Spender - That is not so.

Mr CHIFLEY - According to those who understand these matters it is not so easy. The Prime Minister dealt with that point. Other people may very easily be in as dangerous a situation as are members of the forces, and very often they may not have the means to defend themselves. Members of the Volunteer Defence Corps do not get the benefit of this provision until they go into camp and are in receipt of pay. It is only fair to direct attention to the fact that the introduction of uniform income tax benefited no one more than the soldiers. Last December we exempted the dependants' allowances from taxation. Then, when the uniform income tax was introduced, the soldiers derived further benefit. In some States the earnings of soldiers, including dependants' allowances, were taxed if they exceeded such a small amount as £100, but that has now been wiped out since the States have vacated the field of income tax. The estimate of the loss of revenue involved in exempting dependants' allowances is £2,000,000 for 1942-43, and about £3,000,000 for 1943-44. The revenue involved in granting to members of the defence forces an exemption of £250 with a deduction of £94 diminishing by £1 for every £1 over £261 is £1,000,000 for 1942- 43, and about £1,500,000 for 1943- 44. Those are very substantial concessions. The honorable member for Warringah talked about people in barracks who do not go into the danger zone, but they are always liable to go there. The honorable member for Fawkner (Mr. Holt) spoke about members of the air force who fly to sea and go into combat. The Minister for the Army (Mr. Forde) who is threatening to travel to advanced operational bases might put up a similar argument. So I have to be very careful about that. It cannot be denied that the concessions we have given are great. I know that no treatment of the defence forces can be too generous, but there must be an end somewhere. I am still awaiting a suggestion whereby I could get more money for the Treasury. All the suggestions I have received so far since being Treasurer have involved paying money out of the Treasury. All the matters that have been raised in this discussion are worthy of consideration, but, once you give one concession, you come to the borderline of another. At some point we have to stand firm. The concessions that the Government has given since December last are reasonable. I am willing to examine the other points that have been raised, but I remind honorable members that, before adopting any proposal, I must ascertain what effect it will have on the revenue.

Clause agreed to.

Clause 14 (Payments to fund providing benefits to persons on war service).

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