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Wednesday, 19 October 1949


Mr ACTING DEPUTY SPEAKER (Mr. Sheehy) - Order! The Minister must be allowed to make his speech without interruption.


Mr Holt - I did say that the collections for the first three months indicate that the receipts will exceed the Treasurer's estimate.


Mr DEDMAN - The honorable gentleman made that statement, but the receipts for the next three months may show a decline compared with the estimate. An Opposition always advances the contention that the estimated receipts from a tax will probably be exceeded by the actual collections. That contention is in line with the argument that is adduced about the swollen coffers of the Treasurer. The honorable member for Pa wkner added receipts from sales tax, customs and excise, and said that the total return from indirect taxes would be £159,000,000.


Mr Holt - No, £185,000,000.


Mr DEDMAN - According to the budget statement, the total receipts from indirect taxes is estimated at £159,000,000. However, the actual figure does not really matter for the purposes of this discussion. The honorable member for Fawkner then said that last year we had expended £81,000,000 on social services benefits, and, therefore, we were taking from the people in indirect taxes about double the amount that we were returning to them in the form of social services benefits. It is easy for the honorable member for Fawkner or for any other honorable member to take a given item or a series of items in the budget and hypothecate those revenues to a particular purpose. The honorable gentleman did not mention heavy items on the expenditure side. For instance, just as it can be said that the amount raised in indirect taxes is double the amount paid to the people in social services benefits, so it can be said that the amount raised by indirect taxes will be more than absorbed by servicing the debts of "World War I. and World War II., and that this item and defence services account for far more than the total returns from indirect taxes. Therefore, I do not understand the logic of the honorable member's argument, unless he has been trying to confuse the public about the amount of money that was raised by indirect taxes, and the comparatively small amount, as he regarded it, that is expended on social services benefits. I merely want to make it clear that there are particularly heavy items of expenditure about which the public does not hear very much. For example, the people do not hear much about an amount of £21,600,000 for War (1914-18) Services. When members of the Opposition are growling about high rates of taxes, they conveniently omit to mention that the allocation this year for "War (1914-18) Services" and "War (1939-45) Services" is £75,000,000. I did not follow the argument that the honorable member for Fawkner advanced. I did not understand why he mentioned the amount of revenue from sales tax, and tried to relate it to social services benefits.

The honorable member for Fawkner also stated that the sales tax concessions, totalling £6,000,000, could have been made with greater benefit to the general public. He suggested that sales tax on certain selected items should be abolished. The honorable gentleman did not state the amount of tax collected on those particular items.


Mr Holt - I did. I gave a figure of £10,000,000 for the three divisions.


Mr DEDMAN - We have to raise revenue by some means or other in order to meet all the expenditure of government, including expenditure on the two world wars. It is easy for the honorable gentleman, who has not the responsibility of the Treasurer, and indeed, is not likely to have that responsibility in the near future, to suggest that the Government should give away £10,000,000 when all that the Treasurer (Mr. Chifley) can see his way to concede on this occasion i3 £6,000,000. I believe that this concession will be well received by the public. This Government is not in the habit of making promises to reduce taxes, but I assure the honorable member that the Government and the Treasurer are far more likely to make further reductions of sales tax than the Opposition parties would be likely to do if they should constitute the Government. The amount of money that this Government raises inindirect taxes in proportion to the total revenue that it receives is far less than the proportion of indirect taxes to total revenue was when the Opposition parties occupied the treasury bench. The honorable member for Warringah (Mr. Spender), who was Treasurer for a period, presented a budget in which the proportion of indirect taxes to total revenue was very much higher than the proportion of indirect taxes to total revenue has been in budgets presented by Labour treasurers. All the evidence shows that the people are far more likely to receive reductions of indirect taxes from the Labour Government than they are from governments composed of the present Opposition parties.

It is true that the platform of the Australian Labour party contains a reference to the abolition of indirect taxes; but the honorable member for Bourke (Mrs. Blackburn) knows perfectly well that Australia has just emerged from a costly war, and that it is impossible, at the present time, to abolish all the indirect taxes, including customs, excise and sales tax I do not think that the honorable member would approve of the abolition of the excise on wines and spirits, although that is an indirect tax, as much as the sales tax is. There are qualifications to the Labour party's desire to decrease or abolish indirect taxes. It is true, as a matter of theory, that direct taxation is a much more equitable way of raising revenue than indirect taxation is, but on account of heavy war expenditures, the Government has not found it possible to grant greater concessions than it has proposed in the budget.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.







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