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Wednesday, 5 October 1983
Page: 1397

Mr TUCKEY(8.10) —The honourable member for Lowe (Mr Maher) made various comments. He referred to the novelty of the situation. Of course, he tried to refute the circumstances raised by the honourable member for North Sydney (Mr Spender) regarding attacks on one's family. There was a great novelty once known as the Opera House lottery. I recall that many years ago one of the first winners of that lottery lost their son. The poor little devil was eventually found dead in the boot of a motor car. So while the novelty exists, let us confront the difficulties. Nevertheless, I have no objection to passing on details of my private affairs to the leader of my Party, with an authority that he pass them on to Mr Speaker should Mr Speaker make such a request. Further, I make the point that I have some pride in my personal achievements. I have little difficulty in telling this Parliament and the world at large of my achievements in the financial sector. I appreciate the position of my colleagues and I take the view that we should support their position.

I raise some issues that might be of interest to honourable members when we talk about ourselves as representatives. I am happy to tell the House, as I have said previously, that I am involved in the ownership of four liquor licences. Yet, when I speak against excise increases in this Parliament, I ask myself: For whom am I speaking-me, the 100-plus licensees of my electorate or all of the consumers in my electorate who would, of course, be obliged to pay extra to the licensee when this Government increased excise? It is time that we asked ourselves what is an interest and when is a responsibility at this level of government one which concerns ourselves more than our constituents.

I have grave reservations about this motion, and for good reason. This type of requirement has existed for many years under State law, as the honourable member for the Northern Territory (Mr Reeves), who is trying to interject, well knows. Very few members would understand the definition that can apply with regard to private pecuniary interest. I suggest in future that a member who pays income tax at a discretionary rate might be constrained to declare an interest in the Budget. I have read a local government auditor's report claiming that participating in a vote for structured electricity charges levied by a local authority required a declaration of interest by a councillor. Simply because different rates applied to different people the charges were not common to all councillors. I add that we would create in this place a circumstance where people would find themselves ferreting out information. One of the greatest problems that I see in this motion is that it does not tell us what is the penalty for our commitment. For instance, do we get a lecture from the Prime Minister (Mr Hawke) if we are naughty and fail to do something, or do we get a lecture from you, Mr Speaker? Will there be a fine, or a disqualification as exists in some circumstances in local government? Suddenly we would find people from both sides of the political sphere trying to ferret out information on their opponents so they can be removed from the political sphere.

I address some matters that refer to the motion. Section 2 (d) of the motion calls for declarations of directorships in private companies. This is a requirement that apparently most Ministers claim to have met. There may be a little doubt about that after today because they are still remembering. I looked at the declarations that were tabled in this Parliament by the Prime Minister. I picked a company at random and instructed my staff to look at that company through the proper channels. I got some surprising answers. In regard to this matter, which I want to discuss in this Parliament, I have no intention of directly referring in any way to the Minister or the company that I have investigated. I want that to be clearly understood. When I finish my speech those revelations will not be made. On the other hand, should the Prime Minister not be aware of my information, I am prepared to pass it on to him. It is his responsibility to fill in the gaps in information that is not available to me, but which his Minister might easily supply.

The information I have obtained, which I will now summarise, concerns a company which is listed in the statements of private interests of Ministers. It was incorporated in 1964 with issued capital of $2,020. From my inquiries, no further capital injection is evidenced in the company returns. In 1973 when the Minister concerned became a director, its share capital and reserves stood at a nominal $10,000. From that date until 1978 the net worth of the company rose to $1,664,948. I repeat: Almost $1.665m.

Mr Howard —This is a Minister?

Mr TUCKEY —It is the company of a Minister referred to in the statement. Company returns lodged during this period and during the company's history show no provision for or payment of company tax. I add that such a situation is not necessarily one that indicates improper activity. I am not indicating improper activity. I will not pass judgment, as has been done on this side of the House on previous occasions. I will deliver the facts. Since 1977 it seems that distribution of $1,664,948 has been made to the Minister and members of his immediate family. The company seemed to deal mainly in land. In 1978 there was a registered agreement-this is the matter of greatest concern to me-of sale of one of its properties to a developer for $550,000. There was an understanding that a relatively high density sub-division could be achieved by that developer. Apparently, the original sub-division application did not succeed, and the eventual number of blocks approved was only 10 per cent of the original application. The value of the land presumably was then less than $550,000. Of course, this was evidenced by a sale by the same company of adjoining land of similar area to a family shareholder for $60,000. Quite clearly, $60,000 was too low a price for that block and probably took into account the fact, of course, that that shareholder would have to pay State government stamp duties and, at the time, State and Federal taxes that were still applicable.

Whatever the real value, the sale proceeded 12 months later under rather special conditions. The records show that the sale proceeded at a price of $550, 000, but only $40,000 cash was paid by the developer. The balance was to be paid interest free over three years. Should the developer fail to pay the balance after three years, interest at 12 1/2 per cent would be charged. Had that interest rate been charged on the amount outstanding from the beginning, as would be normal practice, it would have equalled $73,750 per annum, or $221,250 of taxable income to the company over three years. However, repayments were made by the developer and probably as much as $200,000 in interest was capitalised into the sale.

It is not my right to claim that the use of such a device is tax evasion. Apparently, the company convinced the Commissioner of Taxation that that was not so, or otherwise failed to advise him of the circumstances of the sale. The company seems to have paid no tax because of this capitalisation of interest payments, resulting in a loss of roughly $90,000 to that much vaunted Federal revenue. The company has continued to show trading losses in its registered balance sheets lodged with the appropriate authorities. Subsequently it seems that the company has now transferred over $1.6m to its shareholders, including a Minister, and in a fashion that apparently, according to the documents that I have, did not attract tax in the hands of the shareholders. So government revenue missed out again.

The style of these activities and others with respect to possible State charges and taxes would normally-I repeat normally-be the work of someone committed to massive tax evasion. It is reasonable to say that anyone who went to all that trouble in the normal and proper returns which are lodged with State company authorities would be committed to massive tax evasion. However, there is no way that this can be assessed from the information published in the statement tabled by the Prime Minister the other day. There is no way, other than through the appropriate areas, that I could get the final information, which is confidential between that Minister and the Commissioner of Taxation.

Mr Steele Hall —Which Minister is this?

Mr TUCKEY —I have said clearly that I do not intend to say who the Minister is. It is the responsibility of the Prime Minister to do that. The company can be found in the records submitted, and all the documents that I have in my file are about that company.

Mr Howard —Is his return incomplete?

Mr TUCKEY —I do not know. I am not saying anything. I am not passing judgment on a man. I have seen members in opposition in this House, on the most fragile of evidence, crucify people. I am not doing that and I sincerely hope that none of my colleagues will do that. I will give honourable members the facts as they are . They demonstrate why this proposal before us is a farce. The proposal before us is a farce. The proposal is another example of this Government's philosophical commitment to charge in. It only produces things that are inadequate and deceptive. Consequently, it can create great difficulties for some and at the same time fail completely to achieve the stated objective. Of course, the end reduction of the withholding tax is another classic example of that situation, and we are seeing evidence of that today.

I have documentation to support my allegations which I will hand to the Prime Minister should he come into this chamber and give an undertaking to conduct an appropriate inquiry to determine whether the Minister I have referred to should hold public office and guarantee this Parliament a report on the findings on this matter in due course. In the meantime, as I have said, I will stick to my resolution not to identify the individual or the company concerned. However, I suggest that my assertions, based on the public record, reflect the total inadequacy of these ministerial disclosures.