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Tuesday, 7 March 2000
Page: 14019

Mr BARRESI (2:35 PM) —My question is addressed to the Treasurer. Would the Treasurer advise the House how the states will benefit from the introduction of the new tax system, and how their ability to provide services will be enhanced?

Mr COSTELLO (Treasurer) —I thank the honourable member for Deakin for his question and acknowledge the fine work that he does in representing the citizens of Deakin. Of course, under the new tax system not only are we introducing the largest personal income tax cut in Australia's history but we are totally reforming Commonwealth-state financial relations. The states will be given all of the revenue from GST. May I say that again: the states will be given all of the revenue from GST, which will allow them to abolish their current inefficient indirect tax bases and will also mean that the annual bunfight at the Premiers Conference, when they come to Canberra looking for money, will be over.

This is, of course, of great assistance to the states. That is why the Labor Party is ostentatiously trying to engage in conversation at the moment to try to ignore the benefits that are available to the states. When we were in opposition, we used to try this trick too. You would turn around to your frontbench and talk in loud voices so you would not have to put up with the bad news. It will not actually give the Leader of the Opposition any inspiration. As the Labor chat room yesterday said, `In the talentless Labor frontbench, things are so bad that Laurie Brereton is now being talked of seriously.'

If, of course, the GST should be rolled back, the states would be the losers, and if the states were the losers the Commonwealth guarantee recently announced by the Leader of the Opposition would mean that the Commonwealth would have to make up the difference. Not only would it have to make up the difference; it would have no goods taxes to make it up from, so it would come out of income tax. The Leader of the Opposition has hooked himself on his own petard. He was asked recently about where he would actually roll back the goods and services tax, and this is what he said yesterday—listen to this for a clear enunciation of Labor Party policy. For four years he has been thinking about his roll-back policy, and this is the little gem he came up with yesterday. Mr Beazley said:

This is why I sensibly have taken the view that, after announcing that, in principle, we're committed to rollback and not rollback just immediately ... certainly roll-back immediately ... but over time, we have given ourselves the flexibility to look at the budgetary circumstances at the time.

This is not prolix; this is gobbledegook. He might as well say to the press gallery, `Get used to gobbledegook.' The fact is that he is on an uncharted road to an unknown destination with no means of paying for it and no policy. He is like a rolling stone.

Mr Horne —Mr Speaker, I rise on a point of order. My point of order is on relevance. I know the wine was nice at lunchtime, and obviously the Treasurer over—

Mr SPEAKER —The member for Paterson will resume his seat.

Mr Reith —Mr Speaker, I rise on a point of order. That comment should be withdrawn, Mr Speaker.

Mr Horne —Mr Speaker, I withdraw.

Mr SPEAKER —The member for Paterson has facilitated the House by withdrawing, and I thank him. I understand the Treasurer has concluded his answer. I call the member for Barton.