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Thursday, 7 August 1930

Senator DALY (South Australia) (Vice-President of the Executive Council) (11:33 AM) . - I sincerely hope that honorable senators will not adopt the course that Senator £. P>. Johnston evidently proposes to adopt. He has already warned us that he has several amendments to move. If we were to create a* long list of exempted items, it would not be much use to have a sales tax bill. The "Government has found it necessary to collect a certain amount of revenue by this method of taxation, and the subject of exemptions was exhaustively debated in another place, where the list was increased to the very maximum. The capital value of the exempted goods amounts to £300,000,000.

Senator Sir George Pearce - Could not an exchange be effected by deleting from the list cigars, cigarettes, and tobacco, and substituting more important items relating to primary industries.

Senator DALY - Cigars, cigarettes, and tobacco already carry very heavy customs and excise duties. That is why they are excluded from the sales tax. I have no doubt that there are many laudable items that could be included in the schedule of exemptions; but I urge honorable senators to realize the exceptional position in which the Government finds itself. It has gone to the farthest limits in exempting goods from the sales tax, and if the Senate insists upon moving further amendments to that list it will be impossible for the Government to accept them, in view of its financial position and the amount of revenue that it desires to raise from the tax. I appeal to honorable senators not to impose further hardships on the Government by moving that additional items be added to the schedule. It certainly would be much more equitable to move for the deletion of some of the items now on the exempt list, with a view to substituting others. I know that honorable senators realize how necessary it is that Australia should restore its credit. That can be done only by balancing the budget. The Government expects to raise £5,000,000 by the operation of the sales tax. I put it to honorable senators that, if they restrict this form of taxation, the endeavour to balance the budget will be checkmated. Unless there are cases of serious hardship which present a stronger case than that put forward by Senator Johnston, I ask honorable senators not to press for further exemptions.

Senator Sir HALCOLEBATCH (Western Australia) [11.36 a.m.]. - While the Minister urges that honorable senators should advance a stronger case than that submitted by Senator Johnston he has not answered that case. We are told that the capital value of the exempted goods amounts to £300,000,000. It sounds quite a lot of money. I take it that there are reasons for those exemptions. Are we to accept it that the people who happened to get in first with their applications for exemption, and thereby build up the list to £300,000,000, have, exhausted the possibilities of further exemption, and that cases of even greater urgency are to be cast aside? I assume that these exemptions have been granted because it is considered to be wise to take that action in the interests of the revenue and of the country, rather than to subject them to additional taxation, and to further burden the industries concerned. Would it not be wiser for the Government to grant an exemption if a sound case can be made out that the failure to do so would burden an industry that is steadily going down hill, and threatens to go out of existence? I take it that the exemption proposed by Senator Johnston would not increase the £300,000,000 by any appreciable amount, but that it would be of considerable advantage to the industry. I do not think that Senator Daly advanced a very good argument by stating that the Government had already exempted goods to the capital value of £300,000,000, and that the list could not be increased. That might be a strong argument against the hurried passing of legislation of this nature, but it is not a valid argument for refusing to exempt an item, the exclusion of which is extremely desirable.

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