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Tuesday, 21 August 1973
Page: 166

Mr CREAN (Melbourne Ports) (Treasurer) -I move:

That the Bill be now read a second time.

The sole purpose of this Bill is to give effect to the proposal announced in the Budget Speech to abolish the exemption from sales tax applicable to non-alcoholic carbonated beverages containing not less than 5 per cent by volume of Australian fruit juice or its equivalent in concentrated form. The ostensible purpose of the exemption, as I mentioned earlier, is to enlarge the market for Australian fruit. While it has provided further outlets for some varieties of fruit, the additional returns to growers represent only a fraction of the cost of the exemption which is currently running at about $25 m a year. This, as I said in my Budget Speech, is a classic example of using the wrong instruments to achieve an objective.

The Government is prepared, if the need arises, to provide funds to assist with the reconstruction of any sectors of the fruit growing industry affected by the withdrawal of the exemption. In this regard, I might mention the fruit growing reconstruction scheme which, as I indicated in the Budget Speech, is to be extended to 30 June 1974. Consequent on the withdrawal of the exemption, which will be effective on and from tomorrow, 22 August 1973, all carbonated soft drinks will be taxable at 15 percent, whether or not they contain Australian fruit juice. A memorandum explaining the provisions of the Bill is being circulated for the information of honourable members. I commend the Bill to the House.

Debate (on motion by Mr Fairbairn) adjourned.

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