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Wednesday, 10 May 1972
Page: 1538

Senator WEBSTER (Victoria) - Two important matters have been raised in the debate in the Senate this evening of the Excise Tariff Bill. Members of the Opposition have referred to the report of the Senate Select Committee on Offshore Petroleum Resources. Some months ago we dealt with that report which relates to a very important issue. The 2 speakers who preceded me in this debate in referring to the report said that the Government is very much to blame because the Senate has not been given a more substantial opportunity to debate it. Senator Keeffe has just said that it is regrettable that the Opposition has had to raise this matter in the debate on the first reading of an Excise Tariff Bill, but that was quite unfair of him. He knows quite well that on practically every sitting day in recent months the Opposition has raised a great variety of matters in urgency motions. Apparently the matter to which he referred tonight was not considered to be of sufficient important to raise in that way. As a member of the Senate Select Committee that prepared the report I acknowledge its importance and feel that it is due for lengthy debate in the Senate so that the Government can be more fully appraised of the views of honourable senators as to the type of legislation which should be introduced.

The other important matter was raised by Senator Negus. He referred to death taxes and I wish to speak to the Senate on that subject for a few minutes. Quite a unique situation has developed when Senator Negus speaks here on death taxes and perhaps it should recommend itself to the Government as being of major importance. I congratulate Senator Negus for speaking on the matter again this evening. The importance of his speech is underlined by the fact that he was elected as an independent senator to represent Western Australia without any party support whatsoever. He campaigned for election on the one issue of abolition of a certain type of tax. I am not sufficiently naive to think that a candidate would not gain a lot of acclamation from people for wanting to abolish taxation. Many people would support such a candidate, but the Australian people are pretty sensible and are not likely to return a candidate to the Senate simply because he proposes to abolish taxation. Senator Negus is seeking simply to abolish probate duty, estate duty, or whatever it is called in the different States.

The importance of the election of Senator Negus should figure prominently in the minds of the Government. He claims to have some standing in this matter at present but I would deny that he is the initiator of moves to abolish estate duty. I would similarly deny the claims by interjection of my colleagues in the DLP who appear to think that they initiated this move in the Senate. Long before most DLP senators were here the matter was debated and the Government parties were split in voting on the matter of federal estate duty. Death taxes are not only a Commonwealth matter. They are also applied by the States and if they are to be totally eliminated action must be taken in both the Commonwealth and State spheres.

It appears to me to be quite illogical that the Commonwealth and the States have maintained this type of taxation. Many representations have been made to me over the years as undoubtedly they have been made to other honourable senators, by their relatives, friends, connections or political affiliations. They have noted the distress caused to individuals when, on the death of the breadwinner in the family, the survivors must live in an agitated situation not only because of the death of the breadwinner but also because of the very grave strictures of the Commonwealth and State governments on the assets of the estate.

My Parry has had a particular interest in this area and I do not think it is unfair to say that the interests of the rural community should be a prominent part of the Country Party platform. Together with our colleagues in the coalition we have gained for the rural sector something which is perhap not available outside of it. I advocate to the Commonwealth that it evaluate its position and see what can be done to bring about a significant reduction in the impact of this type of taxation and then pursue its elimination. The elimination of death taxes is a policy of my Party and I agree with it. In this area some significant contributions have been made to beneficiaries of rural estates. Honourable senators may recall that through recent legislation the amount of exemption allowable to rural estates was raised by 20 per cent over that allowed to the general community. That was a wise move because it was an encouragement to people whose assets were involved in rural industries, who liked that type of life and who had a wish to decentralise their assets away from where the major assets are held by most people. It was a wise move because it could be conducive to their viewing estate duty in this light.

Senator Murphy - How does one distinguish between- rural industries and other industries?

Senator WEBSTER - Senator Murphy has asked me a question. I thank him, a Queen's Counsel, for asking me such a question. Surely it must have come to his notice as a legal man and surely he has expressed an opinion on it on many occasions. The definition of rural holdings is set out in the Estate Duty Assessment Act, with which Parliament has dealt. I do not have the Act in front of me, because this debate was brought on suddenly this evening, but I do recall that the definition is holdings in rural real estate. I think that it extends to rural stock holdings. It can be held not in the ordinary terms of stock but in the terms of stock as it applies to rural holdings. That is a significant goat to have achieved. The Act also gave the Commissioner of Taxation power to defer the demands for the payment of duty where it applied particularly to rural estates. 1 will refer to that matter again in a moment because that deferment also conveys itself into the interest that may be required so far as payment of death dues is concerned. Where assets on death were held substantially in rural holdings but where there were other assets, a graduated, scale applied to an estate to a value of $200,000, to the extent that a basically rural estate, if I may call it that, at the point of $100,000 found itself paying approximately one-half the duty that may have been applicable under other circumstances. This is a benefit which has applied to a particular sector of the community. I believe that it is of great credit to i.he coalition government that this has been brought about.

But if we look at some legislation and some of the great problems which the Parliament has dealt with in the past few years and at some of the problems which at this time beset rural industries, what do we find? We find the House of Representatives and the Senate activating themselves in an attempt to bring about a rural reconstruction scheme by which a farmer, having found that his holding is so small that he must expand it to live in this expanded type of financial living that we have at present, is encouraged to expand. We are making offers to him to enable him to purchase his neighbour's land so that his holding may be expanded. This brings us to the point that most rural holdings, in at least my State of Victoria, have been broken down by the effects of estate and probate duty. I could quote a dozen cases, as undoubtedly Senator Negus could, in which families who have lived on a farm for years have found that when the head of the family has died the demands of both Federal and State estate duty have made it essential to sell part of the property. Yesterday honourable senators opposite complained about the amount of foreign investment in this country, about the selling of part of our country and about what this has done to our country. It is a blight on our community that for the past 40 or 50 years rural holdings have been broken in two and families have been divided. The economics of rural production have been harmed by this kind of taxation. It is no credit to us that we pursue, as we do, the demands by which an estate can be broken down, as I understand the position generally, by up to 40 per cent which represents the amount that has to be found for the Commonwealth Government. It must have cost the Government millions of dollars over the years to find productive units, which were taxpaying in the normal sense of income tax each year, being denuded so that the Commonwealth could take that lump sum at the end of a life. Today income from estate duty represents approximately 1.4 per cent of total Commonwealth income. 1 suggest to the Minister for Civil Aviation (Senator Cotton) that he convey to the Government the great concern that is felt by many honourable senators about this iniquitous type of taxation. If an exemption cannot be introduced immediately, the exemptable limit which has been allowed - in some instances it is $28,000 and in other instances it is $20,000 - should be raised in the forthcoming Budget to approximately $50,000. In the circumstances, this amount not having been reviewed while the value of the dollar has fallen by 3 per cent or 6 per cent in the last 20 or 30 years, I think that would be a logica] think to do. The Commonwealth, acting on behalf of the people, should act correctly in this matter and should grant further benefits to the people of Australia.

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