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Monday, 17 June 1996
Page: 1582

Senator SHERRY —My question is directed to the Minister representing the Treasurer. I remind him of a statement made by the now Treasurer, Mr Costello, to the National Press Club on 17 May 1995, when he said:

It is not our agenda to introduce new taxes. It is not our agenda to bulk up the currently existing taxes.

Do you agree that an expansion of the wholesale sales tax to cover items that are currently exempt from that tax constitutes the breaking of this promise? If not, why not?

Senator SHORT —I am not too sure what the now Treasurer said on 17 May 1995, but I can well believe that that is what he did say because everything that he and this government have done since the election has been in accordance with that statement. For you to say that the proposals put to the premiers last week constitute any change to that is a total misunderstanding by you of the nature of the taxation system.

The fact is that on numerous occasions before the election and on equally numerous occasions since the election the Treasurer, the Prime Minister, myself and others have made it clear that in terms of getting the finances of this country right, on the revenue side, the question of exemptions and anomalies are matters that need to be looked at. That is precisely what was done last week. That does not constitute any increase in taxes.

Senator Sherry —So $1.2 billion is not a new tax?

Senator SHORT —If you want to look at people who break their promises, what about looking at a government which in the months before the 1993 election said that it had legislated into l-a-w law the biggest tax cuts in Australia's history. Two days after the election they sat down and worked out how they were going to deliberately break those promises, which they knew they never had any intention of meeting.

They were a government which, two months after the election in 1993, increased sales tax across the board and introduced new taxes over a whole range of areas. They were broken promises. Everyone knows that that was the case. The fact is, Senator Sherry, that nothing that was said by the government last week in any way contravened the total commitment that we have given to the Australian people that we will not be introducing new taxes or increasing existing taxes.

Senator SHERRY —Mr President, I ask a supplementary question. Minister, how does your defence of the Treasurer and the government sit with what you told this chamber on 28 June last year when you said:

. . . the government has now added to the disaster of the wholesale sales tax system by expanding it to cover a number of items, which I have already mentioned, that are currently exempt from such tax. That does constitute the breaking of a seemingly very firm promise by the government before the election that there would be no new taxes.

What do you think about what you said on this issue last year?

Senator SHORT —Senator Sherry obviously cannot understand the fundamental difference between a range of tax increases which the previous government, his government, did in government and the very responsible approach of the present government to the whole question of anomalies and exemptions in the taxation system, of which the approach of the Treasurer and the Prime Minister last week was a very important example. I just come back to the fundamental point that I made at the outset: this government is totally committed to no new taxes and no increases in existing taxes. That was the situation; that is the situation; that will remain the situation.