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Thursday, 13 April 1972
Page: 1586

Mr WHITLAM - I ask the Treasurer a question consequent on that asked him by the honourable member for Adelaide. I ask whether the committee to inquire into the taxation laws would be authorised, if the States agreed, to inquire into and report upon the equity and cost of other forms of taxation in Australia at present in the hands of State governments or their authorities. I particularly ask him this question for 2 reasons. The first is that many State taxes absorb up to one-third of the revenue they produce in the collection thereof. The second is that the forms of taxation available to the State authorities - rates and charges - are rising more rapidly, in percentage as well as in amount, than the taxes levied by the States or by the Commonwealth.

Mr SNEDDEN - In my thinking on the terms of reference for the inquiry I did not have in mind that the inquiry should look specifically at State taxes although I did have in mind that the inquiry would need to take account of the incidence of State taxes in order to put them into context with the incidence of Commonwealth taxes. I do not think that the honourable gentleman would object to that. However, he asks me to carry it a step further, if I understand his question correctly, and that is that, if the States requested it, would I agree -

Mr Whitlam - If they agreed - with their agreement.

Mr SNEDDEN - Even with their agreement a request has to be made initially. I would not be making a request of the States that they submit their taxation procedures to the inquiry. I would not do so for 2 reasons. The first is perhaps a lesser reason, and that is that I want a result from the inquiry as quickly as I can get it and I do not want to delay the result of the inquiry. That result is not likely within a matter of months nor is it likely within a year and that is why I had to make it clear in my statement the other night that the Government would not regard its hands as tied in relation to tax reform because there was to be this inquiry. We might find it necessary to take action and not to defer taking that action until we had the report of the inquiry.

I do not want the report delayed and therefore I would not initiate anything that might have that result. Secondly, the raising of taxes by the States is a matter of the constitutional responsibility of the States and I think it would be improper for me to suggest to them that the question of the incidence of their taxes should be incorporated into a public inquiry by the Commonwealth as to the incidence of its taxes.

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