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Wednesday, 15 August 1906

Mr KELLY (Wentworth) .- The honorable member for Laanecoorie seems to be uncertain as to whether the increase in the import duty proposed by the Government will make the revenue larger or smaller.

Mr Salmon - It will maintain it at about what it is now.

Mr KELLY - The honorable member did not inform the Committee why he thinks that a higher duty will lead to equally larger importations. As a general rule, the higher the duty, the smaller the importation of the article to which it applies. In this matter, I propose to accept the verdict of the protectionist Commission which reported to the Victorian Parliament in 1895 in the following terms -

In regard to the import duty on spirits, the revenue of Victoria therefrom has been as follows : -


Making every allowance for the decrease of duty caused by depression in the colony, and for the disturbance of trade at the time of the increase of duties in July, 1892, we think that the higher rates have resulted in a very marked decrease of revenue.

Mr Deakin - I entirely disagree with that. '

Mr KELLY - The honorable member for Laanecoorie has explained that he supports the proposals of the Government for two reasons - that they will result in the maintenance of the revenue, and that they will tend to bring about temperance. The report which I have read completely discounts his assumption in regard to the maintenance of the revenue, while, as to the encouragement of temperance, which the honorable member finds it convenient to advocate at the present time, I think that the temperance people are not anxious that we should devote ourselves to the building up of an industry in which they do not believe. If the honorable member is really desirous of assisting the temperance cause, he will have to vote later on for increasing the Excise duties.

Mr Salmon - Why?

Mr KELLY - In order to benefit the revenue, and to prevent the fostering of an ignoble industry.

Mr Salmon - Is it not better to have the industry in Australia under proper supervision than to rely on importations?

Mr KELLY - The honorable member is now shifting his ground. He told us a few moments ago, with his hand on his heart, that his object is to prevent the sale of grog, but, when I accuse him of wishing to foster the distilling industry, he says' - still with his hand on his heart - that he does so only because it gives an opportunity to control the manufacture of such spirits. The attitude of the honorable member member has varied as I have described. He knows that he advocated, these proposals on. two grounds : in the first place, because of the protection that they would afford to the revenue; and in the second place because he was anxious on temperance grounds to see a decrease in the consump-tion of spirits.

Mr Salmon - I never mentioned temperance.

Mr KELLY - Then I have unwittingly done the honorable member a wrong, i' shall refer to Hansard to see whether he did not refer to temperance. I desire to direct attention to the conclusions arrived at by the Victorian Tariff Board with reference to the deterioration in the quality of spirits brought about by the increase of duties in that State. The Board say -

On this important subject we heard the evidence of every branch of the trade and of some disinterested persons. On the main point, viz.,, that the spirit duties should be reduced, there was a perfect unanimity of opinion.

An importer of wines and spirits, who represented the importing trade, placed before us some very instructive figures in regard to the effect of the late increases of duty on the revenue. The duties, import and excise together, collected in Victoria in 1891-2, the year before the increases of rate were levied, were, he said, £806,622. In 1892-3, in the early part of which year the higher rates came into force, the amount was £472,805, showing a decrease of £333,8r7.

During the same years he pointed out that the revenue in New South Wales, where both import and excise duty is 14s.. per gallon, with an allowance for under-proof spirits, had not fallen in anything like the same ratio, the decrease being from £860,134 in 1891-2 tc» £746,743 in 1802-3, equalling £r 13,39^ This greater proportionate decrease of the revenue of Victoria was attributed partly to the depressed

A little later on they remark- -

We gather from the evidence that the high duties have fostered corruption in the trade, and led to much business immorality. Although we have no direct evidence, we firmly believe, and indeed the records of the Excise Department show, that inferior spirit is constantly sold fraudulently under the cover of good brands. The blending of colonial spirit with imported we believe to be general, and we further think that the blend is sold as imported spirit. One witness told us that he had endeavoured in vain to find out where the large amount of colonial spirit produced was vended.

The high duties have also, we believe, fostered illicit distillation. Several illicit stills have lately been discovered, and a Melbourne merchant told us that he had reason to believe there were many others, and that illicit distillation was on the increase.

These statements of the Board gave rise to protests on the part of the distillers of Victoria. The Board again looked into the matter, and subsequently reported as follows : -

Although the duties on spirits, wine, and beer were dealt with fully in the first report, at the urgent request of representatives of the distilling industry, we took further evidence upon the subject. A large amount of additional interesting information, which we do not think it necessary to recapitulate, will be found in the minutes of' evidence. No material facts of sufficient importance to induce us to alter our principal recommendations were, however, brought to light. Much of the evidence has, on the other hand, tended to show that our proposal for the alteration of the duties is moderate and equitable and necessary in the interests of the revenue.

This matured verdict of the Victorian Tariff Board effectively disposes of the claim that a duty of 15s. is necessary in the interests of the revenue, and also shows that a high duty will inevitably lead to deterioration in the quality of the spirit supplied, and to the introduction of corrupt practices into the trade. In this Parliament we have always professed to be solicitous for the moral and material welfare of the people whose interests are committed to our charge. We have very properl v insisted upon the temperance traditions of the Papuans being thoroughly maintained, and we have decreed the abolition of military canteens. Even the private privileges of honorable members were

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