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Monday, 29 May 1989
Page: 2957

Senator WALTERS(10.07) —My question to the Department of the Treasury relates to sales tax. I have been assured by industry that the sales tax can often be put on in the example I will give. Let me take a wheelbarrow costing $100. Sales tax is 20 per cent. The invoice price, with the sales tax included, is $120. It can then pass to a retailer-wholesaler and the profit margin of 10 per cent on the tax paid cost can be added and another sales tax on the margin of 20 per cent adds an additional $2.40. It can then be passed to a retailer whose profit margin of 25 per cent would be put on the total sum. Is that how it works practically?