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Wednesday, 10 October 1984
Page: 2058


Mr BRAITHWAITE(6.16) —I would like to say at the commencement of my remarks that we heard a whole lot of hogwash from the previous speaker, the honourable member for Newcastle (Mr Allan Morris), who devoted the first minutes of his speech to trying to put an analogy that I still fail to comprehend. Still and all, if he is prepared to waste 10 minutes on a subject as vital as the Income Tax Assessment Amendment Bill 1984 [No. 2], that is his problem. An allegation has been made against the former Treasurer, the honourable member for Bennelong (Mr Howard), about what happened five or six years ago and the retrospective collection of income tax. I remind Government members that in 1974 a Labor Treasurer set out in his Budget to clamp down on the Curran scheme. I am not sure by what means he intended to do that, but he was going to bring to an end the Curran scheme, which had been in operation from the late 1960s. What did he do about it? He did not do a thing about it. Legislation was not introduced into this House in connection with the Curran scheme or anything else. So Government members should not come in here and carp and harp about the previous Liberal Party Treasurer, who acted as soon as he received information but who adopted the principle of not taxing retrospectively. In fact the Government in that instance removed itself from the collection of any money.

We are talking about a figure of $15m in respect of the legislation before the House. The Government has cooled its heels for 12 months with legislation that it was told could be made effective as from 8 December 1983 but not retrospectively. What has it done? It has denied the Treasury the collection of those funds from that date until now. This is the attitude that is taken by people who are against tax avoidance. Government Ministers have spoken about this matter in moments of honesty, which does not happen very often. I will not include in that the Minister for Science and Technology (Mr Barry Jones), who is at the table. The Minister for Finance (Mr Dawkins), the Treasurer (Mr Keating) and the Minister for Housing and Construction (Mr Hurford) have all said at some stage that tax avoidance was a dead issue, that it was no longer an issue. They even had the honesty to insist that the $9.5 billion deficit was a figment of the imagination of the Prime Minister (Mr Hawke) and would never have been on with the previous Treasurer. They have often quoted a much lesser amount. The Minister for Housing and Construction did just that more recently. So there have been glimpses of honesty by members of the Government. However, I have not seen that honesty displayed today. I was very sorry to see Government members come in here with their tails thoroughly between their legs. They have been told by the Australian Democrats, as we have tried to tell them since December of last year, that they will accept this legislation as from now but they are against the principle of retrospectivity. The Government is short on principle.


Mr Allan Morris —We will bring it back.


Mr BRAITHWAITE —The honourable member had better just check yesterday's or today 's newspapers because they said that the Government has given that principle away. I think the fact that we are dealing with this legislation today is evidence of that. I think it is further evidence of the fact that the Government has finally found out that, firstly, tax avoidance is a dead issue and, secondly , it was not worth while trying to trigger a double dissolution with legislation of this type. We now have the facts before us. The Government is going to a normal but very early election without using these tax avoidance measures as triggers.


Mr Cadman —Indecently early.


Mr BRAITHWAITE —Indecently early, as my colleague says. That is evidence of the fact that at long last, although one may not be able to tell a Labor member much , at least he has learnt from the hard grind of having matters rejected by the Senate that tax avoidance was dead before the Government came to office. It was killed by the previous Treasurer in the legislation that has been described.


Mr Allan Morris —Just tell us about the money.


Mr BRAITHWAITE —The honourable member knows about the money. I do not know about it.


Mr Allan Morris —Where is the money?


Mr BRAITHWAITE —The honourable member should go and ask Costigan. In many of those schemes, even those that we acted on under that legislation in 1980, many innocent people were involved. Money had been paid to them in all innocence and I believe that the collection of it would have been a miscarriage of justice. Something that was legal yesterday should not be made illegal today. Tax avoidance is about the interpretation of the Income Tax Assessment Act within the confines of what can be got out of it. I suggest that all honourable members do exactly that. If there is a measure in the Act that allows a parliamentarian a benefit which may not be afforded to others, he will take it. I defy any honourable member of the Government to say that he has not used the tax Act to his maximum benefit. That is the pity of the Act. It is so convoluted that it does give incentives to and provide for the minimisation of taxation, and people will take that opportunity.

The Government has not addressed itself to an issue which is not dead at the moment, the prescribed payments tax. In 18 months it has done absolutely nothing about it except to put into place legislation threatened by ourselves in the Budget of 1983. Beyond that there has been no attempt to get at tax evasion. The Government is talking about $15m in connection with the cherry-pickers. I refer honourable members to the comments and calculations of the Leader of the Opposition at that time, the present Minister for Foreign Affairs (Mr Hayden), when he came in here and said grandly, in a loud voice, 'Tax avoidance' and, in a very soft voice, 'and tax evasion are worth $16 billion in Australia annually' . Instead of saying 'tax evasion' in his quiet voice he should have said it more loudly. What has the Government done there? Not a thing, not a crumpet. It is to those things that I believe the Government should have been addressing itself. We certainly will be addressing ourselves to them in government. I have spoken on this Income Tax Assessment Amendment Bill 1984 [No. 2] on many of its visits to this House in the past. I have to keep saying that the ex-Treasurer, the honourable member for Bennelong, did more to ensure the collapse of the tax avoidance industry than any other Treasurer has done. In fact, the present Treasurer expected to get handfuls of money to balance his Budget from his big tax avoidance issue. He expected $30 a week for the average taxpayer, or something like that. He expected billions, not millions, of dollars, and he found the cupboard was bare because there was no more tax avoidance money in the stream. People in this House have estimated the amount of revenue that could be collected retrospectively. They have found that the amounts have diminished as they have found out the facts.

Section 260 was a washout and a failure. It has been a failure since the 1960s. Labor previously rode through three years of government and did not do a thing about it. Again it fell to the honourable member for Bennelong to correct that anomaly also. The passing of that legislation led to the final funeral and burial of tax avoidance in this country.

At long last I am very happy to be able to support the Bill and to recognise that the Government has come to its senses in a delayed manner. I suggest that this might be a lesson to the Government; winning an election does not give it a mandate to do everything, including varying its principles.

Question resolved in the affirmative.

Bill read a second time.