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Wednesday, 10 May 2000
Page: 16213


Mr MOSSFIELD (5:49 PM) —The Fuel Sales Grants Bill 2000, the Fuel Sales Grants (Consequential Amendments) Bill 2000 and the Product Grants and Benefits Administration Bill 2000 operate as a package to provide a tiered scheme of grants for petrol sales to consumers in non-metropolitan areas, with a higher rate of grants to be provided for sales in remote areas; to standardise the administration framework for grants and benefit administration by the Commissioner of Taxation; and to ensure that the grants are covered under the Taxation Administration Act 1953, like other taxes in such areas as prosecution and offence collection and recovery.

The ALP will be moving an amendment, but we are not endeavouring to oppose the bill in total. Our amendment reads:

That all words after “That” be omitted with a view to substituting the following words:

“whilst not declining to give the Bill a second reading, the House condemns the Government for worsening the city/country fuel price differential by imposing a GST; and imposing a costly, complex, and uncertain new layer of compliance burden on fuel retailers”.

This bill supports the view, put by the ALP over a long period of time in this debate, that the inclusion of petrol in the GST will widen the city-country petrol price differential. The government's plan involves reducing the excise on fuel by a set amount of 7c or 8c a litre and then imposing the 10 per cent GST. This will have a differing effect, depending upon the retail price at the time. If the existing retail price of petrol were 77c, removing the 7c of excise and imposing a 10 per cent GST would have no effect on the retail price. However, if a country petrol station were charging 87c, removing the 7c excise and adding 10 per cent would increase the price from 87c to 88c a litre because of the GST, and the city-country differential therefore would increase. This price effect is an inescapable fact. The government continues to claim that no petrol prices would rise as a result of the GST. The Labor Party and many independent motoring organisations have consistently pointed out that the government simply cannot deliver on this promise.

The Fuel Sales Grants Bill 2000 establishes a grants scheme to fuel retailers for sales in non-metropolitan and remote areas to end users. A grant will apply to all such sales after 1 July. A sale is when the fuel is delivered, not when it is paid for. The bill merely establishes a framework of grants. To obtain a grant, a proprietor has to register under the scheme. There is simply no detail provided about the key points—namely, where the non-metropolitan locations are that will qualify for the grant; where the remote locations are that will qualify for the higher grants; and what is the rate of grants at the various places. I would have thought that members on the other side would want to know this information. I think it is vital information if people in country areas are to benefit from this legislation.

In an earlier contribution to this debate today on this legislation I heard the member for Braddon, in a quite outstanding speech, make the point that the major motoring organisations in his state of Tasmania were seeking this vital information. And I am sure that the motoring organisations right throughout Australia are seeking this information. All of these key points are to be dealt with within the regulations to the bill. This is a bad way to conduct government—that is, by regulation. Where is the parliamentary scrutiny? I will quote from the excellent Bills Digest, which is available to us all, where it says:

The scheme is largely to be implemented through regulation rather than by specific criteria contained in a Bill. The Treasurer's Press Release states:

Details on entitlement to the grant scheme, including the mechanism for determining non-metropolitan and remote areas, along with the grant rates will be prescribed in the regulations to the legislation.(7)

Regarding which areas are to be included in regional or remote areas, a spokeswoman for the Treasurer is reported as stating: 'You will have to wait and see—

What sort of a response is that when people want to know these details—

closer to the introduction of the GST', and 'If we were to announce it now, there might be a temptation for some to increase prices to take advantage'.

I do not believe that this is the way to run government and I do not believe that this is the way to introduce new legislation. There is simply not a good enough reason for this parliament to be denied vital information in this legislation. If we were to accept this argument, we would not have any details about any legislation before the parliament because there would always be excuses as to why people want to withhold certain information. This is typical of the government: they want to push through this GST legislation without full scrutiny, or with as little scrutiny as possible. But I do not believe that the Australian people will accept that.

I also want to make the point that this is still a very unpopular tax. I believe that government members are being very brave or very gallant, or being very silly, if they honestly think that this is a popular tax, because it is not a popular tax. People in my electorate are telling me that it is not popular and that they do not like it, and people in the constituencies of the government members must be saying the same thing. But, quite clearly, the people will not trust the government on this issue. Why should they? Firstly, we had the Prime Minister say that he would never ever introduce a GST. Then we had core and non-core promises and then we had limits on the promise whereby Treasurer Costello actually attempted to walk away from the promise when he told Laurie Oakes on the Sunday program that there were limits to the promise. This jettisoning of the bush outraged Australians. This in turn, of course, led to the Prime Minister claiming that the promise would be made in full.

The scheme itself is currently estimated by the Treasury to cost over $500 million over four years, although I believe that this cost may already have increased. Details have not been released to the public, other than the Treasurer announcing that non-metropolitan locations will get a 1c a litre grant and remote areas will get a 2c a litre grant. Put simply, this bill is very confusing. It does not clarify any of the details that are necessary to evaluate the effectiveness of the scheme. The Treasurer is simply saying, `Trust me.' Ross Gittins had a description in the Sydney Morning Herald this morning, and these are his words:

The worry is, the supercilious one has little to be smug about—but shows no sign that he realises it.

So, `trust me' Treasurer, I do not believe the Australian people will. Just as with the diesel fuel grants for heavy transport vehicles, the government presumably has not actually settled the details for the boundary changes yet. This legislation is another example of a half thought out GST proposal that is confusing to both the general public and business alike.

The Product Grants and Benefits Administration Bill 2000 will also impose a further compliance on fuel retailers. The cost of compliance will presumably be able to be retained by the retailer although, once again, this is not clear. However, if this does not apply, the retailer will suffer a loss through participation in the scheme. Does this matter? Of course it does not, as long as the government spin doctors are trying to convince bush voters that they are being looked after. Again, to blazes with the business owners' problems. The details about the full compliance burden are non-existent, as are almost all other administrative details. For example, how often are grants paid? What is the base for calculating grants? Is it post sales or anticipated sales? Is the grant subject to income tax for the recipient? What records have to be kept in order to satisfy the requirements of the scheme? All of these are very important details for people in the industry.

This bill also covers other administrative matters, such as the method of registration and cancellation of registration; the assessment and payment of claims; compliance enforcement measures against those schemes that attempt to abuse the grants, recovery of unpaid debts and penalties for false statements; and, information gathering and access powers of the Commissioner of Taxation, including secrecy provisions.

The bill standardises the administrative framework for grants and benefits administered by the Commissioner of Taxation. The Fuel Sales Grants (Consequential Amendments) Bill 2000 will amend the Taxation Administration Act 1953 to ensure that the administration provisions which apply generally to acts administered by the Commissioner of Taxation will apply appropriately to new grants and benefit laws. These include those relating to prosecutions and offences, general interest charges which apply to outstanding amounts and the collection and recovery of tax related liabilities.

The lack of detail in this legislation will only add to the general confusion in the minds of the general public and business over the introduction of the GST. Does the government really think that the petrol outlets and their customers in Dundas, Dee Why or Doonside in Western Sydney will not ultimately demand to be part of the package? Because they most surely will. I have previously called for the whole GST package to be deferred for 12 months. This would allow people to come to grips with it and would allow, I believe, business and consumers to understand it better. But, clearly, when one looks at this bill and considers last night's budget, this will not happen. Therefore, the confusion will continue and the government's GST will continue to cause them great electoral damage. Remember well that it is the Howard government's tax package and not the ALP's, and no amount of humbug and huffing from the government will have us attached to any part of it. The tax is yours and the Democrats. This bill, while providing inadequate compensation measures for this unfair tax, will however not be opposed by the ALP.