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Thursday, 6 April 2000
Page: 15421

Mr KELVIN THOMSON (12:19 PM) —A New Tax System (Trade Practices Amendment) Bill 2000 is the latest in a long line of bills, amendments and regulations which we were told would simplify tax administration in this country. You have really got to laugh when you think that the Treasurer was making this claim that we would get a simplified taxation system. We note that the last time the Treasurer used the word `simplify' in the House with respect to the effects of the GST was on 28 June last year, and even then he was talking about the Australian business numbers and their effect on taxation arrangements for business. We are pleased that the Treasurer has developed at least some sense of embarrassment and has stopped referring to the GST as simplifying taxation in Australia.

The Labor Party will not be opposing this bill. Whilst we have consistently opposed the introduction of the GST, it has become law. When it fails, we have no intention of allowing the government, in its desperate search for scapegoats, to come looking for us. As far as this government is concerned, it is wish granted: you have got your legislation; now let us see how it goes in practice.

Does the bill have any redeeming features? Its essential characteristics are that corporations and those who engage in conduct which, in the words of bill, falsely represents, whether expressly or impliedly, the effect or likely effect of the new tax system changes or misleads or deceives concerning the effect or likely effect of all or any of the new tax changes, are liable to prosecution There are already provisions within the trade practices legislation for misleading and deceptive conduct generally and for misrepresentation generally. So when the government come in with a specific bill and say, `We are going to attack anything in the nature of representations concerning the GST that we believe are false,' this starts to sound suspiciously like Basil Fawlty in Fawlty Towers: `Don't mention the war.' They are telling retailers, `You can talk about anything in relation to price rises, but do not mention the GST.'

This reeks of political censorship. That is reinforced by government speakers earlier in this debate making thinly veiled threats to prosecute the Labor Party for statements made concerning the GST. We have absolutely no intention of being intimidated concerning this matter. All you retailers out there, when your prices go up, whatever you do do not mention the GST or you might be committing a criminal offence. Even worse than that, if someone comes into your shop and looks at the price rises and says, `Oh, that dreadful GST,' if you do not talk to them about wholesale sales tax changes or tax cuts or something of that nature you might be committing a criminal offence as well.

I might ask the House whether this legislation might affect, for example, the AFL supporter packages. If you go to the AFL's official web site, you find that, if you are an AFL supporter and want to go to Sydney or to Adelaide for a game, you can purchase one of these AFL supporter packages. But the web site says:

... for all games after the 1st July 2000 a 10% GST will apply to all prices.

When one of my staffers—a Hawthorn supporter, but I suppose we can forgive him for that—rang the AFL concerning these supporter packages, he was told that, for example, the cost for the Sunday, 4 June game between Hawthorn and Sydney at the SCG, including Ansett air fares, accommodation at the Sydney Intercontinental and a reserved seat, is $377.40 per person. But, if you go after 1 July, for example, on Saturday, 22 July to the Kangaroo-Sydney game at the SCG, once again including Sydney air fares, Sydney Intercontinental accommodation and a reserved seat, the cost will be $415.14 per person—that is to say, the pre 1 July cost plus the full 10 per cent GST. That is the sort of thing that is going on.

This thinly disguised bid to silence retailers is yet another bill in a series which underscore just how badly this government is botching the implementation of the GST. I want to give the House a few examples of this. The Australian Retailers Association recently held a seminar in my electorate to assist small businesses with the implementation of the GST. It was a well-attended seminar—not surprising in view of the questions that small business has concerning the GST. A few of the facts from the presenter were as follows. If you do not have electronic point of sale equipment, it will take you 10 hours a week to account for the GST but, if you do, it will take only an hour per month. If you do not get the point of sale equipment and do the business activity statements yourself, your accountancy payments would go from the once a year payment of $2,000 to four quarterly payments of $1,500 each—so $6,000 over the course of the year. If you did not remit on time, the government is likely to send in an administrator to get your books in order, and the cost of technology set-up for the GST would be between $3,000 and $8,000 for retailers. It was said that 20,000 New Zealand small businesses went out of business because they did not get the GST right and that in New Zealand over 80 per cent of businesses had electronic point of sale equipment within 10 years of the GST being introduced, whereas currently in Australia only 40 per cent of Australian businesses have electronic point of sale equipment.

The presenter told his audience that you are not allowed to increase prices by 10 per cent—you might need to tell the AFL that. To avoid attention, he suggested eight or nine per cent would be the maximum. He suggested that the time to increase prices for reasons other than the GST was not on the tax system changeover but before or after the changeover to minimise the change in price. So the main message from the man at the front of the hall was: `Get that electronic point of sale equipment or you have had it,' and in everybody's pack was advertising for the MYOB GST software, and as well there was a live demonstration of that software at the back of the hall. Through all of this, the theme is: you need a new computer to do the GST properly. If you do not have it, your business is up the creek without a mouse.

On that same theme, I have had correspondence from Shane Murphy—not the senator—from Grange in Queensland. Mr Murphy runs a small convenience store. He recently got a letter from a supplier of this point of sale software, Retech Global. Mr Murphy has explained that he is one of this company's 500 customers who use a DOS based point of sale software. He was incensed at what he saw as blatant exploitation of the GST by this company which, instead of offering him support for his current system, told him that he must spend between $5,990 and $7,990 to get their GST compliant software and hardware. He already has a computer system, but he is being told that he has to spend thousands of dollars on a new one. The company are effectively stopping support for his old system and forcing him to buy the software and hardware from them. Mr Murphy noted that he called them and asked for just the software and was told that DOS users must get both the software and the hardware, or there is no deal. The point he makes in his correspondence to me is:

We are not even trading profitably at present. We have no hope of absorbing $7,990.

You have to contrast that kind of expense with the miserable $200 which the government is giving small businesses as its GST compensation. In the limited time available to me in this debate, I will make one final point. The government has indicated that the amendments relating to access undertakings are simply intended to clarify the constitutional basis for the powers. At face value, that appears to be the case. However, Labor is concerned that there is a chance, however slight, that some access undertaking that would fall within the constitutional heads of power may not fall within the proposed section 44ZZA(3A) codifying those heads of power. We have requested that the minister put on the parliamentary record that the government does not intend to narrow the scope of acceptable undertakings within constitutional bounds, and I look forward to the minister delivering such an undertaking in this debate.

As I indicated before, we have no intention of allowing the government to claim that it has not been able to properly implement its GST and its price surveillance mechanisms. We are concerned that this bill is much more about censorship, in particular of retailers but potentially of anybody, concerning the GST, inviting them not to talk about the GST and under no circumstances to mention the war if prices go up—and, indeed, it appears that many prices will go up by much more than the government's predicted 2½ per cent. We will be examining this legislation in the Senate very closely indeed.