6th Parliament · 1st Session
Mr. Speaker took the chair at 10.30 a.m., and read prayers.
– Will the AttorneyGeneral cause the Divorce Bill to be circulated amongst honorable members during the adjournment about to take place?
– Although a draft of the Bill has been prepared, the Government have not had an opportunity of settling its terms. Until that is done and the Bill put before the House, it would certainly be most improper to publish it. The Bill ought to have been introduced long ago, but the excuse of the Government must be the extraordinary circumstances in which the country finds itself. It will be introduced at the earliest possible moment when we resume our sittings.
– In connexion with the Trading with the Enemy Act, I wish to know whether the Attorney-General has seen an advertisement published in the Argus, and covering about a quarter of a. page, in reference to “ Sanatogen,” which, I understand, is a German preparation? If so, has he satisfied himself that this preparation, or some portion of it, which is said to be entirely British made, is not made in Germany?
– The position in regard to “ Sanatogen “ and a number of other preparations of German origin which have a wide reputation, has been considered by my Department as well as by the Government. There can be no doubt whatever that “ Sanatogen” and one or two other patent medicines or foods are of German origin, and that the profits derived from them go to Germany. The Government have decided that no newspaper publishing an advertisement relating to this preparation shall he permitted to pass through the post.
– Following on the question put to the Attorney-General by the honorable member for Capricornia, I desire to ask the Prime Minister whether he has yet taken any step to put into effect the recommendation I made to him last week, and in which he concurred, that the Government should absolutely prohibit the importation into Australia of all goods covered by an enemy trade-mark or trade description ?
– The matter has been given consideration, but it is one that cannot be decided in a day. No man can say off hand what goods may not be excluded to our own disadvantage, and however strong may be our desire to fight the enemy, we are not going - if I may use an every-day expression - to cut off our noses to spite our faces.
– I understand that the Minister of Trade and Customs has in the past prohibited the importation of certain quack medicines that claimed to do more than they could do. I wish to know whether the Minister has observed the claims which ‘are set forth in this morning’s Argus as to the virtues of “ Sanatogen,” informing the public that old people will be made healthier, happier, and more vigorous, and that it will produce a real and lasting improvement in one’s bodily health, a definite increase in one’s nerve energy, and a profoundly beneficial effect upon every organ and function in one’s body? Is the Minister satisfied that this medicine can do all that it claims to do; have his analysts informed him that the advertisement is fraudulent in its claims, and will he therefore prohibit the importation of the medicine ?
– The sole control that the Customs Department has of this matter under the Commerce Act is the power to prohibit the importation of any article which does not comply with certain restrictions which are laid down. I am not sure whether “ Sanatogen” is one of the articles which has been dealt with from an advertisement point of view, though I do not think that its importation would be allowed with the leaflets making these claims accompanying it; but once an article comes in there is no power to prevent leaflets being printed and wrapped round the bottles or tins. In the Customs Department there are advertisements from nearly all the newspapers of Australia advertising quack remedies which would not have been permitted had they accompanied the bottles on their importation.
– It could be stopped if we provided that the formula should be printed on the label.
– A recent House of Commons inquiry approved of the action taken by the Customs Department here as being absolutely the best that could be taken as far as the power of the Commonwealth existed to protect the people in this regard. Unfortunately we cannot deal with the newspapers which publish these advertisements.
– Has the AttorneyGeneral directed the attention of the newspapers to the enemy nature and character of “Sanatogen”? If not, does he propose to give them warning as to his intention to penalize them for continuing such publication ?
– Certainly. But I assume that they will take this declaration of the policy of the Government as a warning. We do not propose to proceed against the newspapers without warning. In addition to “ Sanatogen,” I propose to notify the other preparations which, in the opinion of the Department, fall within the same class, after which any newspaper publishing such advertisements will fall within the scope of the notification.
– Will the Minister for the Navy state whether it is true as reported that he proposes to introduce in connexion with his Department a digest such as that issued by the Department of Home Affairs, so that he may keep a grip over the Department of which he is the first Sea Lord ?
– I have instructed the Chief Accountant of the Navy Department to examine the digest system followed by the Department of Home Affairs with a view to its application to the Department of the Navy.
– As there will be a surplus of 3 per cent, out of the 5 per cent, rebate granted in connexion with the chartering of ships for wheat and wool freights, I wish to ask the AttorneyGeneral whether he will recommend to the State Premiers that the residue, whatever it may be, after providing for expenses incurred, shall be refunded to the producers either in the shape of a reduction in freights or otherwise?
– The position of the Commonwealth in this matter is that of agent for the States. The expenses incurred by the States and the Commonwealth in chartering freights will have to be provided for out of the 3f per cent, to which the honorable member refers. The residue, whatever it is, will be handed to the various States, and they can either hand it over to the shippers or direct to the farmers. We do not propose to make any claim of any kind. Our only interest in the matter is that the expenses of the freight arrangement, whatever they are - and, compared with the tremendous magnitude of the transaction, they will be relatively small - must be borne by the transaction. Subject to that, the matter is at the disposal of the States.
– I wish to ask the Attorney-General whether, having regard to tie agreement which he entered into with the shipping agents, it is not a fact that there will be a surplus of £30,000 out of the Commonwealth’s proportion of the rebate to cover any expenses that the Federal Government may incur ?
– If, as the honorable member has suggested, we do make that amount - and it is the first I have heard of it - then, of course, the whole of the 3f per cent, can go back.
– In the event of a charter being arranged abroad, and not directly through the agents of the Commonwealth, wm the charterer abroad receive 4d. per ton and the local agent §ths per cent, also?
– The charge will bo 5/8 ths per cent, plus 4d. per ton.
– Will the Minister for the Navy ascertain if the reputed 2-lb. tins of jam supplied to the Defence Forces contain only 20 ozs. or less. If so, will he see that, for the future, all tins so supplied contain the full weight of 32 ozs. ?
– I had some dealings with this matter when I held the position of Assistant Minister of Defence, and I am able to say that the Department purchases jam by weight, irrespective of the tin weights.
– Has the attention of the Attorney-General been called to a communication from Berrigan, in the Riverina electorate, appearing in this morning’s Age. which states -
The dairy farmers in southern Riverina have been much incensed at the action of the State Government in stopping the export of butter and cream to Victoria.
– Order ! When submitting a question the honorable member is not permitted to read a statement from a newspaper.
– The New South Wales Government have prevented dairy farmers from sending their product intoVictoria, and if something is not done to> protect them they must give up the industry. Will the Attorney-General take steps to protect the interests of these dairy farmers and conserve the freedom of trade between State and State ?
– I know of no warrant for this action of the State. In my opinion any citizen has a good right of action against a State which interferes in any shape or form with the free flow* of products from one State to another, unless and until it has acquired any commodity.
– And then it is absolutely wrong.
– In view of the fact that most of the farmers who are sending produce from State to State, are poor men who are unable to incur the cost of the necessary legal action against the State, will the Attorney-General undertake to institute the necessary proceedings with the object of having this question settled, or, at all events, will he support any citizen who is willing to take a test case to the Courts ?
– If any citizen willsupply evidence for a prima facie case I shall consider it with a view to taking action directly by the Commonwealth, but I must have the evidence before I could think of doing so.
– Now that the newtelephone rates have been laid on the table by the Postmaster-General, are they in force?
– They are not in force. Regulations have yet to be drawn.
– Is it the intention of the Minister of Home Affairs to abandon his motion with reference to the building of a Small Arms Factory at Canberra ?
– In selecting postal officials for service in Egypt, will the staffs in the various States be drawn on, thus enabling the unit to have a better all-round geographical knowledge of the States ?
– When the Minister of Defence is finally deciding this matter I feel sure that every State will be treated on a fair basis.
– Will the Prime Minister say what is to be the course of business at this sitting, and what will be the length of the adjournment that is to be made?
– I am glad that the right honorable gentleman has asked this question, because I am afraid that I see no prospect of the House adjourning this week. I regret it. However, I think that we shall adjourn in time to enable us to pay our respects to the remains of the late Major-General Bridges. If there is work to do we should come back next week to do what we are paid to do. I propose that we should sit until the lunch adjournment, and then adjourn until another day.
– I am sure that the Prime Minister will see the unfairness of what he now proposes to do. Does he consider his treatment fair after an arrangement has been made, on the strength of which the Government has been allowed to get a number of Bills through practically without discussion, and after honorable members have sab up all night in order to assist Ministers to get them through ?
– There was no reflection upon the right honorable gentleman intended. The state of business here and in another place renders it impossible to adjourn if Parliament is to protect the interests of the people. I regret it. I long for a short adjournment, but it is at present impossible. I appreciate the action of the right honorable gentleman in allowing three urgent Bills to be put through last night.
– Will the Prime Minister postpone dealing with the Income Tax Assessment Bill and the Income Tax Bill in another place until the public have had the opportunity to consider the amendments made in this Chamber, and so that we may know that we are doing the right thing before the measure is finally placed on the statutebook? It was rushed through this Chamber pell-mell, and it would seem that honorable members on this side have been “ let in “ over the whole business. That will not happen again.
– I hope that the right honorable gentleman is not right or correct in saying that he has been “ let in.”
– We have been “ let in,” absolutely.
– It is the desire of the Government not to have anything passed through Parliament without the approval of Parliament. We cannot postpone indefinitely the taxation which is necessary for public purposes, but there will be a reasonable delay of two or three days.
– I desire to make a personal explanation, in view of circumstances arising out of something, as to which I feel sure there is some misunderstanding. The Prime Minister will recollect that last evening I discussed with him, and also with Senator Pearce, as representing the Senate, the business to be done prior to the adjournment. After a friendly consultation it was agreed-
– I am afraid that the honorable member is going beyond a personal explanation, and I suggest that a preferable course for him to take would be to ask leave to make a statement.
– That is what I should like to do.
– Is it the pleasure of the House that the honorable member has leave to make a statement?
– As I have already stated, after a friendly consideration of the business sheet, as well as the sad duty we all have to perform to-day, it was agreed that certain Bills should be put through last evening. I may say that we on this side made a great sacrifice in consenting to put these Bills through without the consideration to which they were entitled; indeed, I think we strained our public duty in order to meet the Government in every possible way. In addition to other business, I allowed the right honorable gentleman to take the Income Tax Bill to the third reading; and further, allowed the Attorney-General to introduce yet another referendum proposal, in order that the second reading of it might be considered to-day.
– You are a philanthropist.
– I very much regret to hear an interjection of that kind. Does the honorable member not see that if arrangements made between parties cannot be adhered to, parliamentary government becomes impossible. I am sure that this is realized by every honorable member opposite, except the honorable member for East Sydney. After making this sacrifice in order to assist in clearing up the business to-day, we are now coolly told by the Prime Minister - although we have fulfilled our part of the bargain generously, and in full measure - that the arrangement cannot be adhered to on his side. Iwish it to be understood that I am making no personal reflection on the Prime Minister - I am far from doing that - but merely pointing out that if this kind of thing is to go on, it will be absolutely impossible to conduct the business of the House, or to make any sort of working arrangement as between parties. I do not wish the right honorable gentleman to definitely commit himself now, but I ask him to see if the arrangement made cannot be adhered to, and honorable members so informed before the business is concluded to-day. The position is very serious, and I have never encountered the like before. The Minister of Defence, who controls the business of the Senate, was present, as I say, at the consultation, and if there is any difficulty in another place, I can only express my sorrow. I ask the Prime Minister to seriously reconsider his reply to me just now, and see if it is not possible to carry out the arrangement made.
– I should like leave to make a statement.
– Is it the pleasure of the House that the honorable member have leave to make a statement?
– My words will be very brief. The facts as stated by the honorable member for Parramatta are correct. I cannot adhere to the arrangement made, and I am very sorry.
– Has the Defence Department decided to do away with the twelve days’ camp, so far as ordinary training is concerned ; and, if so, is it proposed to substitute half -day and day drill? The latter would necessitate many young men who are the support of their families losing considerable time at their work, and I ask the Minister for the Navy to consult with the Minister of Defence with a view to postponing altogether the drills.
– I shall be pleased to bring the question of the honorable member under the notice of the Minister.
Newspaper Postage : Liverpool Camp : Hospital Administration : Voting Facilities : Meningitis : Missing Letters
– The other day I asked the Postmaster-General a question regarding the transmission of newspapers to the members of the Australian Expeditionary Forces abroad. I have since received a letter from a gentleman interested in the matter, who tells me that, on going to the local suburban post office and presenting two copies of the Argus, made up in one packet, for the front, he was told that he would have to pay postage of1d. on each of the papers. At another post office he was informed that he would have to pay 4d., because the packet could not go as newspaper matter, there being more than one newspaper.
The gentleman, following the matter up, took the packet to the post office in Bourke-street East, where the official informed him that, as it was under 16 ozs., and was addressed to the Forces, it could be sent for Id. Is it a fact that there is authority for sending newspapers to the front at that rate ?
– I shall make inquiries, and give the honorable member a reply later.
– The Minister for the Navy promised that he would visit Liverpool Camp during his visit to Sydney last week-end, in order to see for himself the condition of certain conveniences there. Can the honorable gentleman inform us as to the result of his observations ?
– I did promise to visit the Camp, and made all arrangements to carry out my intention, but I was suddenly called by the Prime Minister, and had to leave Sydney on the Sunday night. That, of course, prevented me visiting the Camp.
– Has the Minister for the Navy made arrangements to lay on the table the papers relating to the investigation into the administration of hospitals at the front?
– In accordance with the promise I made to the honorable member yesterday morning to place these papers on the table to-day, I spoke to the Minister, and also telegraphed to the Secretary of the Department, but the papers have not yet arrived.
– I desire to know what effort is being made to carry out the promise given by the Minister of Home Affairs some time ago, in reply to a question by me, that provision would be made to give voting facilities in connexion with the Referenda to those who have gone to the front.
– I do not think that the arrangements are yet completed, and I, therefore, ask the honorable member to further postpone the question.
– Notwithstanding the splendid arrangements that have now been made for free dentistry for the troops, I should like to know whether the Minister for the Navy has had his attention drawn to a letter in the Age of 19th August by Mr. Philpotts, a doctor of dentistry, who suggests that all the soldiers should be supplied with tooth brushes and antiseptic powder, in order to prevent contamination by the germs of meningitis. Will the Minister for the Navy bring the matter under the notice of the Minister of Defence, in order that every means may be taken to prevent the spread of this disease?
– No doubt this question by the honorable member is a most important one, and I shall be very pleased to bring it under the notice of the Minister. I may inform the House, however, that the Minister of Defence is already doing everything possible with a view to keeping down this terrible disease, and has had several consultations with the medical officers with that object in view.
– In view of the fact that the question has been raised so frequently, I should like to know what report has been received in regard to the non-arrival of correspondence for the soldiers billeted in Egypt? I have received a letter informing me that one member of the Forces, who left here ou the 20th April last, has received only two letters out of three or four a week that have been written to him since. A peculiar phase of the matter is that his friends receive all the letters that ‘he writes ; there must, therefore, be something radically wrong.
– The postal arrangements at the front are not in the hands of the postal authorities, but in the hands of the military authorities. The Defence Department is taking steps to’ organize a complete post office staff for the front, consisting of trained and experienced officers, who will be given military rank, and this, we hope, will result in great improvements. I remind the honorable member that a few days ago it was shown by the official correspondent at the front that on one occasion 250 bags of mails went to the bottom of the sea. Whether there have been other similar occurrences I do not know, but this would account for, at any rate, the loss of some letters. However, arrangements are now being made to do everything possible in this connexion.
– Has the Government in hand the report of the Chairman of the Panama Commission, and, if so. will it be placed on the table of the House before we rise for the proposed adjournment.
– On that subject I have no knowledge, good, bad or indifferent. The question should be addressed to the Prime Minister.
Waste of Supplies
– Is the Minister for the Navy aware that statements are being made that large quantities of beef and mutton were on two occasions provided for wounded soldiers who were expected to arrive at the hospital at Mont Park, that no soldiers arrived, and that the meat was not utilized and had to be buried. Will the Minister inquire into the truth or otherwise of those statements?
– I shall make inquiries and endeavour to give a reply at the next sitting.
– As some statements have been published in the press, which, if true, would be a severe stricture upon the administration of the Kalgoorlie-Port Augusta railway, and as I understand the majority of honorable members have been advised of the terms of those statements, will the Minister of Home Affairs make available the papers relating to the matter so that honorable members may be able to judge what warrant exists for the allegations ? I have a high opinion of the Engineer in Chief, and I think that, in justice to him, the papers should be made available.
– I am in possession of a sworn declaration, a copy of which is being sent to the Engineer in Chief with a request for a report thereon. I have not the slightest objection to copies of that sworn declaration, and the reply of the Engineer in Chief, being made available to honorable members.
– Will the AttorneyGeneral endeavour to have the Bill, endowing the citizens of Australia with the referendum and initiative, circulated amongst honorable members at an early date ?
– I shall be glad to circulate copies of the Bill as soon as the final draft is approved.
– In view of the probable early adjournment of Parliament, will the Postmaster-General give an assurance that, until Parliament reassembles, no further reductions will be made in the payments to the keepers of allowance offices?
– I announced a considerable time ago that I have stopped the reductions. I readily give an assurance that there will be no further reductions; this is not a good time to make them.
– In view of the fact that I sent to the Minister yesterday particulars of two cases in which the allowances have been reduced, will he see that the instruction given by him is carried out by his officers?
– Has the PostmasterGeneral yet received any reply from the Western Australian Government in reference to the carriage of mails on country trains throughout that State?
Military Districts : Railway Passes : Patriotic Funds
asked the Minister for the Navy, upon notice -
State these funds will not be available for them, or for their benefit in any way?
– The answers to the honorable member’s questions are -
Lismore may be despatched either to Brisbane or Sydney, as they may desire.
asked the Minister of External Affairs, upon notice -
– In the absence of my honorable colleague, I beg to supply the answers to the honorable member’s questions, which are as follow : -
asked the Minister for the Navy, upon notice -
Does the Government still propose to duplicate the machinery for the manufacture of the present service rifle in view of the accumulation of proofs that it will require to be put aside as soon as possible in favour of a weapon of an improved type, when in all probability a considerable proportion of the machinery now employed in rifle making will be useless?
– The answer to the honorable member’s question is -
A contract has been entered into for the supply of machinery for duplication of the Small Arms Factory. The Department is not aware that the greater part, or any, of the machinery on order or on handwill be useless in the event of a change of pattern of rifle.
Repeal of Regulation 1a
asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s questions are -
The following papers were presented : -
New Hebrides - Appendices to the Report of the Royal Commission on Mail Services and Trade Development between Australia and the New Hebrides
Motion (by Mr. Hughes) proposed -
That the papers be printed.
– Do these papers concerning the New Hebrides comprise the report of the Royal Commission which was appointed to inquire into the mails and other matters in those islands?
– These are the appendices to that report.
– Amongst the things to be printed are some very nice photographs. Here is one of a cocoanut plantation; it looks a perfectly comfortable, lotus-eating place. There is another of natives sailing proudly and boldly over the dancing waves. And there are others. Is there any parliamentary censor of these Commission reports?
– Does the right honorable member suggest that the pictures are improper?
– Honorable members ought to have seen the originals.
– I suggest that at least they are very picturesque. Shall I say they would be distinctly improper in Collins-street? Whether it is necessary to include these photographs or not, may I suggest that in the final printing the type should be made larger and bolder, for an interesting document of this kind ought not to be printed in type that is scarcely readable. I suppose, however, that is one of the results of the new economy. If the papers now on the table comprise only the appendix, I should like to see the report. Has that been printed ?
– I think it has.
– Then I suppose these appendices must be printed also, and I suppose we shall have also to incur the expense of printing these beautiful photographs. The Commissioners might explain why they have put forward the artistic side in so conspicuous and entertaining a way ?
– In response to the challenge ot the Leader of the Opposition, as Chairman of the Commission, I desire to say that there is. nothing whatever in the report but what is of a very informative character. The papers which the right honorable gentlemen has been discussing only contain a précis of the correspondence which the Commission thought would be useful, because, so far as my experience of this House goes, very few members really know where the New Hebrides are.
– Is the honorable member in order in reflecting upon members in this way ?
– Then I will say that their geographical knowledge of the South Pacific is very scanty. Many of the photographs were taken from postcards, some of which are on sale in a photographic gallery in Melbourne, and some are identical with photographs we saw in the album of one of the medical missionaries in the New Hebrides. They are not reproductions of photographs taken by any member of the Commission or by any one instructed by the Commission, and I do not think there is anything in them calculated to bring a blush to the cheek of the most modest member. Honorable members will find much useful information in the report, which was obtained at much trouble at all hours of the day and night.
– I amafraid the honorable member for Parramatta is somewhat super-sensitive in the matter of the photographic illustrations which appear in the appendices to this report. They are included because it was thought advisable to make the report as complete as possible, seeing that this was the first Royal Commission from the Commonwealth that has ever visited the New Hebrides, and having regard also to the importance of members knowing more about these islands and their native population. The Commission, therefore, decided to make the report as informative as possible, not only with respect to mail and shipping matters, but also in regard to the character of the islands, the various types of inhabitants, in view of possible developments resulting from territorial rearrangements after the settlement of the war.
Question resolved in the affirmative.
The following papers were presented : -
Aborigines in Queensland, Western Australia, and the Northern Territory - Memorandum regarding missions to.
Ordered to be printed.
Defence Act. - Military Forces - Regulations amended (Provisional) - Statutory Rules 1915, No. 143.
Quarantine Act. - Regulation amended (Provisional) - Statutory Rules 1915, No. 145.
Bill returned from the Senate with amendments.
Motion (by Mr. Hughes) proposed -
That the Senate’s amendments be considered in Committee forthwith.
– Is it necessary that the House should resolve itself into Committee at once to consider this matter? There is nothing urgent about it.
– There is.
– What is that urgency ?
– The Bill has a relation to the position of public servants who have gone to the war.
– I know; but there is no urgency about that.
-I understand there are a number of men who have passed the examination andwhose probationary period is about to expire.
– I think it is time more information was given to honorable members regarding Bills submitted by the Government. Half-a-dozen were dealt with yesterday in order to oblige the Government, and now this series of amendments, about which honorable members know nothing, is brought forward. I think the further consideration of this Bill might be postponed till later in the day so that honorable members may know what the Senate’s amendments are.
– May I indicate what the Government propose? The first amendment is on page1, clause 4, line 19 of the Bill. Where the words “ One hundred and twenty-six pounds per annum “ were printed the Senate has left a blank with a suggestion that the words “ One hundred and thirty-eight pounds “ should be inserted.
– And is that the sort of thing honorable members should be asked to pass without seeing?
– It is not the intention of the Government to adopt that suggestion. The intention of the Government is to adopt the proposal to leave out the words “ One hundred and twenty-six pounds per annum,” and to also leave out the rest of the clause. That will leave the law exactly as it stands to-day. The other amendment is not important, and deals only with the date. The Government propose to accept that.
Motion, by leave, withdrawn.
Bill returned from the Senate without amendment.
Motion (by Mr. Hughes) proposed -
That this Bill be now read a third time.
.- Owing to the late habits which this House has developed, I was unfortunately absent last night when this measure was advanced to its present stage. I had proposed in Committee to endeavour to secure the consent of the Government to an alteration in the schedule affecting, not the yield which it will give, as anticipated by the taxing authorities, but the method of its compilation; and to ask the AttorneyGeneral to favorably consider a proposition to make the schedule plainer. Students of taxation, and particularly taxation on incomes that fluctuate, are agreed that what a taxpayer desires most of all is a plainly-marked schedule which will enable him to calculate for himself the taxation that he has to pay. It is idle to suggest that one taxpayer out of a thousand will know what he has to pay under this schedule until he receives his assessment notice from the Taxation Office.
– I cannot agree to that.
– Let us consider for a moment some of the formulae that run through the schedule. We all know that it is impossible for the average man to work decimal fractions in pence, or anything else. He has no difficulty in dealing with the grades or steps in a schedule, but where he has to work out in decimals, a difference of so many pennies in respect of the rate of taxation on a given income, the task is one which the average man who has lost his knowledge of school detail feels incapable of attempting. If he wishes to ascertain whether or not the Commissioner’s figures are correct, he will thus be driven to the accountancy profession, and will have to pay a member of that profession a substantial sum to check the assessment notices of the Taxation Office. I am endeavouring to set out in a sympathetic way what I think are the obvious objections to this schedule ; and I repeat that I do not wish to substantially injure the yield from the tax. If the taxpayer does not attempt to check his assessment notice by any expert means, he will always be under the impression that he has been overcharged, and that irritation will continue throughout the period covered by this tax.
– Can the honorable member suggest any means of removing that impression from the mind of the average taxpayer ?
– There is a simple, means which the taxing Commissioner will suggest to the honorable gentleman. I do not say it is possible to remodel the schedule within the next twenty-four hours, but if, as I understand, we are to come back next week, then I think this House should consider whether we ought not to delay the third reading of the Bill in order to enable the taxing Commissioner to present us next Tuesday or Wednesday with a differently-framed schedule. The Commissioner should be told that incomes from £156 up to the next stage should be treated as one step, and that all within that step, subject to the exemption, should pay a tax of 3d. in the £1 ; that the next step should be equally definite, and that all within itshould pay 4d. in the £1 ; and so on, as the set of stairs is raised, each stair being marked in plain figures, with the rate of tax payable. That is the method followed in Australia in respect of income tax, as well as certain land taxation.
– But it is hard on the taxpayer.
– It may press more heavily or it may fall more lightly on the taxpayer. That depends upon how the system is worked out. But as a principle to be adopted in framing a schedule of this kind, it has the merit of being plain to the ordinary taxpayer.
– It has the same merit that a. sandbag or a club has - it is perfectly plain, but also perfectly inexcusable.
– That interjection may be clever, but it is entirely irrelevant. I am not suggesting that either the Government or the taxpayers should be sandbagged. All that I propose is that the taxpayer should have the wool taken off his eyes so that, having ascertained what his income is, he may be able to see and understand how much he will have to pay. That is the position that we in this House, proposing, as we do, to impose this direct taxation iu order to meet the needs of the nation, should desire to achieve. It will involve great thought and care on the part of the officer deputed to frame such a schedule as I suggest should be embodied in the Bill. The schedule would have to be drawn up with due regard to the fact that the desire of the Government is that the tax shall yield a revenue of £4,000,000 per annum, and the grades would have to be so fixed as to yield that amount. I am not suggesting the lightening of the tax at either end, or in the middle; all that I propose is that an alteration be made by using figures that will make the schedule plain to all. Such a proposition must recommend itself to the Attorney-General, and, since it would only involve a delay until Tuesday or Wednesday next, surely it should be adopted ? It would remove a good deal of the irritation which this tax will otherwise create.
– Would not an explanatory table issued by the Commissioner to the taxpayers be sufficient?
– No. The average taxpayer after he has reached thirty or forty years of age is not usually a first-class mathematician, and there can be no doubt that the average man who will ‘have to pay this tax has long since lost his school knowledge of the elementary principles of the decimal system. I do not know whether even the Attorney-General would be able to correctly work out such a sum as I might throw at him.
– If I cannot work out the sum, then I will accept the honorable member’s proposal.
– I could not, while standing here, give the honorable member one that would be sure to trip him.
– I am not going to allow the honorable member to go away and look up a hard one for me.
– If the Attorney-General will give me a half-an-hour’s grace, I will give him one thatwill involve the acceptance of my proposition. The Taxation Commissioner does not work out these details on his feet. He sits at a desk with a great staff about him checking definite figures. I say without hesitation that there will be irremovable irritation amongst the great bulk of the taxpayers if the Government push this schedule into operation, and that we should endeavour, even at the eleventh hour, to avoid it.
– The average taxpayer does not attempt to work out for himself what he has to pay. As a rule, he simply pays on the assessment notice.
– No. Under the Income Tax Acts in operation in the States, a taxpayer, as soon as he knows what his income is, is able to say what tax he should be called upon to pay.
– And taxpayers actually check the figures set out in the assessment notices.
– They do.
– There are always objections to a flat rate.
– I am not speaking of a flat rate.
– The Victorian income tax is based on a flat rate.
– No; it is arranged in stairs, or gradations, rising from 3d. to 6d. in the £1 on income from personal exertion, and from 6d. to1s. in the £1 in respect of income the produce of personal property. Could we not do the same ?
– It is quite a wrong system.
– It is interesting to hear the honorable gentleman, who is but an experimentalist in this form of taxation, talking in this way to men who have had to face it for twenty years, and who have found that the system I advocate works to the satisfaction of the taxpayers.
– To the satisfaction of the Taxation Office, but never to the satisfaction of the taxpayer.
– It always gives, I venture to think, more satisfaction than any bewildering system based on high mathematical principles is likely to give to the ordinary taxpayer, who, just as a man who wants to make a purchase in a shop desires to see the goods marked in plain figures, likes to see the income tax rates plainly set out.
– We shall supply the taxpayers with a plain statement of what they will have to pay.
– But that statement will be in respect of groups of £500, £600, £700, and so forth; that is of no service to the man whose income comes between those grades. The proposition I am making has the advantage of simplicity. That, surely, is a decided merit?
– It is; but the system is unjust, since it discriminates between those on one fiat and those on the next flat.
– So does this schedule.
– When the amount gets beyond a certain figure, the rate rises. My system would provide for a plainly marked set of stairs as against a system which rises in curves of the second and the third degree.
– This is a ramp.
– No; it is like one of those modern inventions of the railroad which runs in a series of eccentric curves, and no man not versed in the bewildering principles of high mathematics will be able to determine accurately what he has to pay.
– A curve of the first degree is-
– A curve of the first degree is such as is worn on the waistcoat of the honorable member for Melbourne Ports; a curve of the second degree is such as is worn on the waistcoat of the Attorney-General. I do not think any complicated principle should be associated with this tax. What we want to achieve is a simplicity that is calculated to offer no disadvantage to the Treasury and to give greater satisfaction to the taxpayer. Surely this is well worthy of the consideration of the Government. If they can show that any real loss of revenue will result from the substitution of a carefully prepared schedule, such as I suggest, for that now in the Bill, I will withdraw my proposition. I do not wish to reduce the amount which the Government have said it is necessary to secure fromthis tax in order to meet the needs of the nation. As one who watched the introduction of the Income Tax system in this State, I can say that quite enough irritation is aroused by proposing a fresh income tax without still further complicating the means by which taxpayers may determine whether they have been fairly treated in the assessment of their incomes. If the Attorney-General will do what I propose, he will remit the schedule again to the Taxation Office Staff, with a direction that they shall build a new schedule which, while yielding the same revenue and, as far as possible, preserving the yield for each grade, will be marked in plain figures, so that he who runs may read. There is another point to which I desire to refer. We were told by the Prime Minister that this is a war tax. The Bill does not show that it is. On the contrary, it indicates that it is to be a continuing tax. Clause 5 sets out that this rate is fixed for all the years it will run. The principle of income taxation as hitherto followed in Australia has been to establish, first of all by an Assessment Bill, the conditions on which incomes shall be annually taxed - the relationship between the Treasury and the direct taxpayer. That Bill has always been followed in every State, I think, by another measure annually fixing the rates. If the need of the Treasurer was great in one year, the rates were advanced; if the Treasurer felt that he could grant a reduction in his next annual fixation of the tax, the rates were reduced. The elasticity of such a system enables concessions to the taxpayers to be made when the nation can do with less, while the Treasurer holds out his hands for more money when he requires more revenue. That principle should be followed by the Commonwealth. There should be an annual fixation of rates. Clause 5 offends in two ways. It offends the principle of the annual fixation of the tax, and avoids the still more important fact that this is admittedly a war tax. No honorable member on this side of the chamber would have agreed to the tax under any condition other than that it was to endure only for the period during which the expenditure upon the war has to be met. If we were to talk of a rate of 5s. in the £1 on the higher grades of in: come as a permanent or enduring tax, it would be, probably, the most crippling thing one could conceive of as regards the financial, commercial, and industrial interests of the Commonwealth, and it is only because the nation realizes that it is fighting for its very existence that we say, “ Very well, it is a case of your money or your life.” Rather than forfeit our existence the people should be asked to pay even, if necessary, at the rate of 10s. in the £1. In that sense a rate of 5s. in the £1 has been accepted by honorable members - because the tax is to be collected for war purposes.
– That rate of 5s. is almost academic.
– It will not be academic to the people who have to pay it. .
– Seeing that companies are exempt very few people will have to pay it.
– I can name half-a-dozen men in my own electorate who will have to cheerfully foot the bill at the rate of 5s. in the £1.
– Name one.
– I do not intend to mention any names, but I can assure the honorable member that there are half-a-dozen men in my electorate who will have to pay this rate. Those who have noted the growth of wealth in Victoria and New South Wales know well that this rate will fall upon some persons - comparatively few I admit - and if it were not for the war this academic proposition, as it is termed by the Attorney-General - though it is not academic, it is real - would not have been introduced. Seeing, however, that it is essentially a levy for war purposes, honorable members on this side have assented to it. I doubt whether half the honorable members on the Ministerial side of the Chamber would admit the wisdom of this tax as a permanent tax. I credit honorable members with the possession of a certain amount of economic knowledge and desire to further the interests of this country. They must know that a permanent tax of 5s. in the £1 on the top grades of income would do more to increase unemployment than anything else they could suggest.
– We all recognise that fact, but this is a special tax.
– The Bill before us does not make it a special tax. It is framed in the permanent phraseology of every measure imposing an income tax, however small, as if it were to endure for all time. If I were speaking of a rate of 2s. in the £1 I could utter precisely the same thoughts, and feel that they were equally truthful. In Victoria there was a rate of ls. 4d. in ordinary times of peace on the higher grades of income, and the State Government took actual tests as to the effect of that rate, not only on capital in the State, but also on capital which was introduced from abroad, and the results showed a flight of capital, induced by the high rate, higher than that imposed in other States or in any sister Dominion. I do not hesitate to say that if a rate of ls. 6d. in the £1 is imposed after the war it will drive capital out of the country to our disadvantage, and will give to the people who live in the country no advantage whatsoever. It is useless to say that high taxation equalizes wealth. The owners of wealth can say, “ We do not intend to pay what is equivalent to 1 per cent, of incomes in Australia when we can invest our money in Canada and j>ay 1 per cent, only, or in the Argentine, and pay 5 per cent, only.” All the operations and calculations of the investing public are governed by circumstances ascertained by and known to them. If we maintain an exceedingly high rate of taxation on incomes, Australia will become a poor country, we shall drive out the accumulations of wealth within our own borders and deter the introduction of capital. If the Attorney-General is quite sincere let him omit the words in the clause which prevent the annual fixation of this tax. At any rate, let him do it for this year. No one can see further ahead than July, 1916. No one knows how long the struggle will last, or what economic conditions will prevail in Australia during the continuance of the war or when hostilities have ceased.
– The honorable member knows that the year has been altered.
– Yes, but my argument has just the same force. We are asked to furnish the Treasurer with as much revenue as we can get for the financial purposes of this year. Next year our needs will be clearer to us. It may not be necessary to have the tax. In any event it is safer to say to the taxpayer that, although the Assessment Bill is to remain on the statute-book, the rates are fixed for one year only. This Bill does not do so. I am right, I think, in saying that the rates are fixed annually in all the States, though the State Assessment Acta are permanent measures. Will the Attorney-General consent to the elimination of the words “ and each financial year thereafter “ ? Their omission would proclaim to the taxpayer that we had fixed the tax for the present year only. There would be ample opportunity in the next financial year to fix the tax that will be receivable during that year.
– I am willing to adopt the suggestion of the honorable member, but not in the exact form that he suggests, because I do not know whether Parliament can meet during the financial year, 1916-17. The war is still in progress, and I do not know what may happen, or what we may be able to do.
– I am pleased that the Attorney-General has accepted the suggestion, though I still think that the elimination of the words would be the wisest course to follow. We should go to the people with a statement that we are putting certain rates on their incomes for this financial year only, and that, if the circumstances next year are as bad as they are this year, or even worse, they will be called upon to face the issue and pay according to the needs of the Commonwealth. I hope that the AttorneyGeneral will also consider the question of an alteration to the schedule on the lines that I have suggested. It would give a considerable amount of satisfaction to taxpayers, large and small.
.- Last night, when we were dealing with clause 16 of the Income Tax Assessment Bill, and the Prime Minister intervened in order to bring forward some new business, I understood that the Bill was not to be dealt with any further; and, as I had already been thirteen hours in attendance, I left the precincts of the House. I was desirous of drawing the attention of the Attorney-General to clause 17 dealing with mining companies, but I find now that the Bill was passed’ through the Committee stage early this morning. Clause 17 says that “ the capital expended by a person carrying on mining operations- “
– The honorable member must not deal with a Bill that hasalready been disposed of.
– Those who are carrying on mining operations in a private capacity are allowed to deduct the whole of their losses on mining operations, and put them against their receipts for the year.
– There is nothing in the Bill about that.
– I point out to the honorable member for Bendigo that we are now dealing with a Bill to impose a progressive tax on incomes, and that in? that Bill there is a schedule showing the amount that will be collected, and so forth.
– I was misled by the honorable member for Balaclava discussing clause 5 ; I thought that the whole Bill was under discussion.
– The honorable member for Balaclava was discussing clause 5 of the Bill before us.
– Then it appears that I shall have no chance of saying anything in reference to this taxation as it affects mining companies.
– The honorable member will see that that is not my fault.
– Then I can only express my regret that the business is conducted in this way.
.- I went home last night with the assurance of the Prime Minister that no business would be dealt with except. the Income Tax Assessment Bill, and yet this morning I find the Bill before us at the thirdreading stage. I should not have spoken ou the motion for the third reading had I ar. opportunity to speak in Committee, and I only wish to support what has been said by the honorable member for Balaclava in regard to the schedule, which is expressed in terms that only those who understand higher mathematics can follow. I suggest to the Attorney-General that, if it must be expressed in a way that mathematicians only can understand, he should adopt the infinitely more simple form of the curve of the first degree, which is represented by a straight line drawn from point to point, each £1 carrying its additional taxation. The actual difference in the amount of revenue that would be raised if this plan were adopted would be infinitesimal, an amount not more than a very few thousand pounds, while an enormous amount of trouble and dissatisfaction would be prevented. The only difference would be a very slight increase on certain portions of the actual incomes, and if honorable members saw the curve of the first degree reduced to a diagram they would understand what is meant. The honorable member for Balaclava suggested that the formula should be altered to definite steps, beginning at 3d. aud going on to 4d., 5d., and so on, and so arranged as to bring in the same amount of tax in the aggregate. I do not know that there is any reason why that should not be done ; but, at the same time, if the Government desire to adopt the same principle that they have adopted in regard to the land tax, with a gradual gradation by which each pound will carry its additional tax, that can be done, and still be expressed by the adoption of the curve of the first degree.
– There is no special virtue in the ramp, when the stairs are understood.
– I do not see any special virtue in the “ramp,” and the terms used are very difficult to follow. There is no necessity to rush this business through for the Senate, and I hope the Attorney-General will consider whether it is not possible to get the same, or practically the same, revenue without introducing the friction and dislocation that I believe this formula will cause. I am glad to hear from the Attorney-General that he proposes to adopt the suggestion made by the honorable member for Balaclava in regard to clause 5, calculating the tax only for this year, and allowing Parliament from year to year to say what the actual rate shall be. I am certain that if it were generally understood that this tax had to operate indefinitely - and that is what is expressed in the Bill-
– Did it ever strike the honorable member that, with the amendments we have made, the tax may prove wholly insufficient for the purposes of the Commonwealth ?
– All the more reason, for taxing anew each year.
– If we leave the impression that this tax is to be continued indefinitely, it will leave an effect on commercial and industrial life the reverse of beneficial. This tax is almost prohibitive in its incidence, and if the capitalist gets it into his head that, on money invested in Australia, he will, in addition to the State income tax, have to pay a Commonwealth tax that is almost penal, I venture to say that out of the very limited capital that will be available for developmental purposes after the war, Australia will get a still smaller share of the world’s capital than she has been getting for a number of years. Of the capital sent from England into other countries for developmental purposes in recent years, a very small portion in comparison has come to Australia.
– In the Argentine, £500,000,000 of British capital has been invested in the last twelve years, while in Australia the amount is only £400,000,000.
– That, of course, is exclusive of Government loans. As I say, Australia has had a very much smaller share of this capital than her immense possibilities warrant.
– But look at the rate of interest in the Argentine!
– No one knows better than the Minister of Home Affairs that, in calculating the interest derivable from capital, the investor takes into account the taxation of the country as one of the charges, and if two countries offer the same rate of interest, and one has double the taxation of the other, he knows where to invest. At any rate, I hope that the actual rate at which this tax will be levied will be expressed in terms more easily understood by the general public.
– I should like to know from the Attorney-General whether a man with an income of over £2,500 a year starts from the lowest rate and gradually works up, or whether he starts at what is laid down for incomes over £2,000. Suppose a man has an income of £2,500 does he commence to pay at 11.713 pence, or does he pay on the whole amount at the rate of 33.600 pence? In other words, does he commence to pay under paragraph b and finish paying under paragraph e, or does he start to pay at once under paragraph e ? I have consulted several lawyers on this question and they cannot agree as to what is the effect of the schedule. The matter certainly requires elucidation. An income of £6,500 is taxed at the rate of 5s. in the £1, and according to the statement attached to the schedule the average rate works out at 41.7305 pence. I believe the Attorney-General has stated that there are few incomes in the Commonwealth of £6,500 per annum, and, therefore, very few persons will be taxed at the highest rate. No figures in proof of that assertion are to be found inKnibbs, or in any other authority. Such a calculation is impossible, and I believe that this tax will realize a great deal more money from the higher taxpayers than is anticipated. The impost will affect, to a great extent, those people who are developing the country, and who have put money into more than one State. Let me quote my own case as an illustration. I have investments in Victoria, New South Wales, and Queensland. Under the State taxation laws I pay in each State on the income I derive in that State, but if the whole of my income earned in different parts of the Commonwealth is bulked, I shall pay at a very much higher rate than I pay under the State Acts. If a man enjoys an income of £3,000 in Victoria he will pay on that income under the States rates. He may also have an income of £3,000 from New South Wales, and a further £3,000 from Queensland. It is impossible for the AttorneyGeneral to trace whether the man who pays on an income of £3,000 in Victoria has derived a similar income from New South Wales. Possibly a man will have a total income of £9,000, and he will pay on that total a higher rate than he pays in the separate States on his three different incomes of £3,000 each. It will be found that under a Federal tax a great many people will pay at a much higher rate than they pay under the State income taxes, and, therefore, the tax will realize a considerable amount of money in excess of what is estimated from the people who pay at the higher rate. I know of a great many people who have interests in Queensland, New South Wales, and Victoria. Many companies are in the same position, and if the AttorneyGeneral will enlighten me as to how the tax will operate in those cases I shall be very much obliged.
– In reply to the honorable member for Balaclava the Attorney-General stated that the 5s. rate was almost academic, and very few people would be required to pay it. The presumption is that otherwise he might consider the advisability of cutting down the rate. The honorable member for Corangamite having assured the Attorney-General that the 5s. rate is by no means academic, but will hit severely a number of people who have large incomes, I should like to know whether the Minister will now consider the advisability of reducing the rate. When the honorable member for Balaclava was speaking the inference was if he could show that there were a great many people seeking relief from the higher rates that would be the best of all reasons why the Attorney-General should reduce those rates, but now that the honorable gentleman has been assured by the honorable member for Corangamite that there are many people who will be required to pay the higher rates, I fancy that the Minister, buttressed by those facts and statements, will be all the bolder in imposing the tax. No matter which part of the compass the criticism comes from, the Attorney-General adroitly turns it to the advantage of his own Bill and the perpetuation of this tremendous tax.
– It has only an academic interest for a majority of people, but it will be very real to those who pay it.
– I think the honorable gentleman said that very few people would pay at the higher rates.
– That is so.
– And that is the reason why the Attorney-General turned down the argument of the honorable member for Balaclava.
– On the contrary, I adopted his argument.
– For a reduction of the higher rate?
– The honorable member did not suggest that it be reduced.
– I did not appeal for its reduction in this particular year, but I showed what would be the effect if it were perpetuated.
– The point I wish to stress is that the 5s. rate does not stand by itself. I have had a statement prepared which shows that in New South Wales, at any rate, the taxation of some Imperial companies will amount to a total of 8s. lOd. in the £1. They will be taxed by the States, by the Commonwealth, and by the Imperial Government. What companies will operate anywhere under such conditions? I do not know of any company, unless it be one that is extraordinarily situated, that could earn an income tax of that amount and pay dividends. Very few companies are making a profit of 8s. lOd. in the £1, and this tax means that we shall take from them all incentive to enter into business and enterprises in some States at any rate. That is the serious aspect of this tax. I cannot for the life of me see anything in the war legislation as presented by the Prime Minister that should require taxation amounting in the aggregate to 8s. lOd. in the £1. If taxation at this rate is necessary for war purposes, it must be paid. If the taxation for war purposes amounted to 10s. in the £1, it would have to be paid. The whole wealth of the community must be placed under tribute to finance the war; but is it necessary to finance this year’s operations in such a way that the requisite taxation in New South Wales will in the aggregate amount to 8s. lOd. in the £1 ? There can only be one result to this. Capital will seek an outlet to some sphere where taxation is lighter, and I submit for the serious consideration of the Committee the question whether these higher rates ought to be imposed, particularly as the tax is a triplicate tax. Three taxes will actually be imposed upon many companies in New South Wales. Representations on the point have been made to the Treasurer, and I would again ask him to reflect whether it is not possible to lighten the burden somewhat. Otherwise capital will be stampeded out of the country, and if it is, honorable members may bid “good-bye” to the staying power of the country and to its resourcefulness for war or any other purposes. During recent years capital has not been pouring into Australia. Happily, the country has been able to do without it to a great extent, though had more capital been invested here, our industrial concerns would have been much more prosperous even than they have been, their ramifications would have been extended, and the volume of trade infinitely greater. But the fact remains that very little foreign capital has been coining in during recent years, and not much more may be expected if a triplicate tax is to be imposed upon it. I should like the right honorable gentleman to make it perfectly clear that the revision of these rates will be considered. In my view a lower maximum rate, if the tax were properly levied, would give a bigger aggregate return, for I do not think the tax has been so fixed as to get the most out of it. It seems almost to have been imposed to give people an invitation to avoid it by taking their capital elsewhere. The war taxation in Great Britain has been definitely allocated for war purposes, and it will be taken off when the war is over. There is no guarantee that this tax will come off at the conclusion of the war.
– On the other hand, there is a suggestion that we are going to have it every year.
– There is that suggestion. Another aspect of the situation has also to be borne in mind. Those who will be called upon to bear the tax directly, will endeavour to secure relief, and if they are manufacturing concerns, the only way they will be able to secure it will be by passing the tax on in the increased price of their goods. My honorable friends in their attempt to hit the big man will be simply hitting themselves in the long run. Many firms will not be able to continue their operations unless they do pass the tax on, and in consequence prices will be re-adjusted, and the consumer will be called upon to bear a big share of the higher penal rates. The object of the Bill ought to be to secure that the tax shall operate equitably over the entire population.I can find no evidence that that will be the case, and I would again suggest to honorable members opposite that they would do much better if they limited the taxation rate and spread it over a wider area. Such a course, in the long run, would be to their advantage, and particularly to the advantage of the working men of the community. If a man is rich he ought to pay the tax, but there is no provision in the Bill for seeing that the rich man will pay. If he is engaged in business, he will be only the agent for the payment of the tax. He will pay it out, but he will take it in again, and so the tax will not hurt him nearly as much as may be supposed. I am not going to stress this point any further. I have already indicated where I think much more money could be gathered at a less cost and with a great deal more fairness and equity than under this proposal. In peace times it is the easiest thing in the world to pass on income tax. It is not quite so easy now, I admit; but, at the same time, the tax must be passed on in many cases if the people concerned are to live, or if they are not to go out of business altogether. They must readjust their affairs. The rate of this income tax, particularly as it becomes a triplicate tax, will, in many instances, have the effect of absorbing the whole of the existing profits. Mr. Asquith laid it down as a cardinal principle of economics that a tax of1s. in the £1 on incomes in times of peace must eventually fall upon both profits and wages. That was the theory of all the financiers who preceded him. It was the doctrine of Mr. Gladstone, as honorable members will see if they read his financial speeches. My recollection is that Mr. Gladstone’s view was that, unless the tax were levied moderately and equitably, it would be the poor people and consumers of the country who would eventually have to bear it. Let it not be imagined that in making these remarks I am trying to shield a few rich people in the community.
– The right honorable member ought to add that in those days Gladstone tried to keep the British revenue down to £80,000,000.
– He believed in the old Liberal programme of “ Peace, Retrenchment, and Reform.”
– All three have now gone.
– Yes, all have gone, and Gladstone is in his grave, with wiser, bigger, and abler economists in their places, but I doubt if the lot of the poor is very much better having regard to the tremendous strides that have taken place in scientific production. However that may be, there is no sign of economy in Australia. This Government does not believe in economy. It believes in extravagance, in lavish spending, thinking that by throwing money around it is serving the best interests of the country. I am glad to hear that there is a possibility of the clause which refers to taxation in succeeding years being modified. I would like to point out, further, that while the British tax is very high, the British war obligations are in some respects greater than our own. But do honorable members know that, whereas the deduction that we propose for each child is £13, in Great Britain the amount is £20 ? It has been argued that it would be illogical to make a greater deduction than £13, inasmuch as that sum is the pension that will be granted for the child of any soldier who falls in battle.
– Would it not be inconsistent otherwise ?
– There would be no inconsistency. The two things are not at all related. Great Britain is paying less in war pensions than we pay, but
Great Britain is allowing a greater deduction per child for income tax purposes than we propose, so that if we are acting logically Great Britain must be acting illogically. But my main contention is that taxation at this period should be limited to the amount required to meet charges arising out of the war. That is not the case here. The only burden we are taking over from the ordinary services on account of this war is £1,800,000. To liquidate that we propose to raise £4,000,000. The right honorable gentlemantold us yesterday that, while this loan was practically for war purposes, he would not separate the income from this tax from any other portion of the revenue. That is to say, this money may or may not be used for war purposes. There is no definite assurance that it will be.
– The Prime Minister gave an assurance on that point the other day.
– That was precisely the assurance the right honorable gentleman would not give. He said yesterday morning that he declined to treat these finances in a sectional way at all. That is to say, he would not separate the war loan from the ordinary income of the year.
– That means that the whole of this new tax will be devoted to the ordinary services.
– That is so.
– From where has the Treasurer to obtain his revenue ?
– The honorable member knows that additional probate duties and land taxation were imposed last year; but a better way of getting revenue at this period would be to establish economies in the ordinary Government services. That simple recipe is long overdue. Its operation may be postponed, but it will have to be faced sooner or later. In both State and Federal establishments expenditure is swollen and extravagant, and is rapidly becoming a tremendous burden upon the people of the country.
Sitting suspended from 1 to 2.30 p.m.
.- I propose to offer a few observations regarding the relationship which this measure bears to the war. Clause 5 provides that -
Income tax shall be levied in and for the financial year beginning on the 1st day of July, 1915, and each financial year thereafter.
If, as the Government claim, this is a war tax, introduced under the shadow of the war, surely the words “ and each financial year thereafter ‘ ‘ should be omitted from the Bill!
– The honorable member does not think that our financial responsibilities will terminate with the war?
– I make no such sug gestion. The point that I wish to emphasize is that it is always much easier to re-enact a measure than to repeal it. It is open to us to re-enact this Bill from year to year, and to fix the rate of income tax that shall be paid in respect of every year during which the war continues. We all hope that the war will be over before the end of the next twelve months.
– The Opposition might be in power twelve months hence, and they would not re-enact such a Bill as this.
– Unfortunately for the Commonwealth, we are not likely to be in power within the next twelve months.
– The honorable member’s party made a mistake twelve months ago.
– We did; and the people made a mistake in returning the Labour party to office. They have two years in which to realize the error they committed, and I have no doubt that, at the end of that time, they will give an emphatic demonstration of how fully they do realize it. The Attorney-General, in discussing this Bill, said that there were in Australia few incomes of more than £6,500 a year, so that the higher rate for which it provides was more or less merely a matter of academic interest. I have good reason for believing that quite a number of incomes earned in Australia exceed £6,500 a year and while those who enjoy them are for the most part anxious to pay their share of any just taxation rendered necessary by the war, it is hardly fair to hit them as heavily as they will be hit under this Bill.
– I know of one poor fellow who has an income of £60,000 a year.
– By all means let the Government tax his income. I know of the man to whom the honorable member refers, and believe that he has given very little to the war funds There rests upon every man of wealth the responsibility of giving as freely as he can in the present crisis. With some rare exceptions, wealthy men in Australia are realizing to the full their responsibilities in this respect, and are observing the very best traditions of the Empire. These men have made their financial arrangements for the year; and although those who were not afraid of what taxation might be imposed gave as freely as they could to the various funds, some of them have restricted their giving because of the fear of taxation of this kind being imposed, and the necessity of making provision to meet it. I am afraid that if we impose these extortionate rates upon big incomes, the effect will be very prejudicial to the further issues of the war loan. The Treasurer spoke yesterday of the magnificent) subscription to that loan. We are all proud that Australia has done so well; but there is a very real danger that, if too heavy a tax be placed upon these higher incomes, there will not be anything like so good a response to the future issues of the loan. The Treasurer quoted certain figures showing the subscriptions made by private companies, and, in one or two instances, by private individuals. He said that quite a number of private persons had subscribed more than the smallest of the sums which he read out; but that he thought it inadvisable to mention their names. If this super-tax be imposed at the rate set forth in the Bill, I am afraid that very little will be received on the next flotation from those who subscribed so well to the first issue.
– Does not the honorable member think that the new taxation has led people to subscribe to the war loan ?
– There is a possibility that the new taxation has induced people to subscribe to the loan because-
– I ask the honorable member not to deal with that matter.
– I was merely replying to an interjection.
– On a point of order, I submit, with great respect, that the financial position in all its aspects is open for discussion on the motion now before us, and that to restrict the discussion by any means would be to deprive the House of a privilege which it has always exercised; and which has always been claimed, both here and in the House of Commons, in connexion with the third reading of any measure providing ways and means, or taxation for the Government. I ask you, sir, to carefully consider the question before you rule that any portion of the financial question is not open to the fullest and freest discussion on this motion.
– The honorable member has mistaken the object of the third reading of a Bill. I called the honorable member for Robertson to order when he was referring to the Loan Bill. That measure was discussed at considerable length when it was before the House recently. Honorable members were then afforded ample opportunity to say all that they desired in respect of it; and that Bill having been dealt with, it is not now in order to refer to it. I did not object to the honorable member for Robertson making a passing reference to it, but he would not be in order in discussing it On a motion for leave to introduce a Bill of this character, every honorable member has an opportunity to discuss, to the fullest extent, the whole financial position. Extensive references may also be made to the financial position on the motion for its second reading, since it is a measure relating to finance; but once such a Bill has been dealt with in Committee and reported to the House, then, on the motion for the third reading, the debate must be confined to the provisions of the Bill itself. The Bill cannot be discussed in a general way. I lay it down clearly and distinctly that, on the motion for the third reading, honorable members must confine themselves practically to the contents of the Bill as it comes from the Committee. I have always followed that rule, and it is followed in all Parliaments.
– Without venturing to move any dissent from your ruling, sir, may I point out that the motion for the third reading of a Bill is one on which full debate is permissible. This is a question which concerns both sides of the House, and, unless you are following some very definite authority of which I am entirely ignorant, I venture to ask you to consider whether we should not be entitled, on a motion for the third reading of a Bill, to give any reasons, relevant to the Bill., as to why it should not pass. A motion for the third reading of a Bill is not different, so far as the limits of debate are concerned, from a motion for the second reading. I do not wish at this stage of the session to create any difficulty, but I should like to know, sir, whether this question has received as yet your full consideration. I feel convinced that your ruling, as just given, would immensely limit a privilege which the House has hitherto exercised.
– If the honorable member will examine the authorities he will discover that at each stage of a Bill the debate upon it is further limited, and that at the third-reading stage the discussion is confined to the subject-matter of the Bill itself. The object of the third reading is to enable any mistake that may be discovered to be rectified.
– I should like your authority for that.
– I can give the right honorable member ample authority for the position I am taking up. I am following a course that I have always adopted in this matter, and I intend to continue to do so unless the House otherwise instructs me.
– I desire to move -
That Mr. Speaker’s ruling, that on the third reading of the Income Tax Assessment Bill no reference may be made to the general financial position, be dissented from.
– In accordance with the Standing Orders, the motion will be taken into consideration at the next sitting.
– The method of arriving at the tax employed in the Bill may be simple enough, but, in my opinion, country people will be considerably confused by it. There is no need for altering the methods to which they have been accustomed in the States. Artists delight in curves, but who would describe the Attorney-General as being artistic? If this graduated income tax is imposed to such a heavy extent as to drive the people with higher incomes out of the Commonwealth, or to give our citizens no encouragement to earn large incomes, we shall damage our future and we shall aggravate an evil which has been growing at a rapid rate during recent years, owing to the feeling of insecurity that men with capital are experiencing in regard to Australia. The flow of capital from the seat of the Empire to Australia has been decreasing to a most alarming extent. We used to be told that trade followed the flag, but, as a matter of fact, in these days of commercialism, we know that sentiment is laid aside, and that trade follows investment. The commercial activity and the growth of Australia have depended to a very large extent on the investments made here by the people of the Mother Country. We are told by the Minister of Home Affairs, in an interjection, that all investments depend on the rate of interest offered, but the influences governing the investment of capital are extremely complex, and the rate of interest is only one aspect. Great Britain last year invested £25,000,000 in Argentine, £14,000,000 in the United States. £13,000,000 in Mexico, notwithstanding all its internal disturbances, £12,000,005 in Brazil, and £12,000,000 in Australia. Here we have a country which is guaranteed by the Union Jack, which is filled with white people, and which exists under a British Constitution, yet money is going just as fast into Brazil, which is peopled to a large extent by a darkskinned race of half-castes, and which has nothing like the possibilities of raising people that Australia has, and labours under the disadvantages always appertaining to tropical climates. It would seem to indicate that there is something extremely and radically wrong in the management of our financial affairs. If we make it impossible for men with capital to turn their eyes to Australia we shall divert the stream of invigorating money which formerly flowed here.” If we continue to impose a graduated tax to the enormous extent provided in the Bill, we shall drive away quite a number of men with capital who are now here - more than have been driven away by existing taxation. I know of my own knowledge that quite a number of men with capital are leaving Australia because the tax of big incomes is so great that it does not pay them to stay here when they wish to retire from business.
– Where will they go?
– Some of them will go to Great Britain.
– They will not escape taxation there.
– If a rich man dies in Australia his heirs are called upon to pay over a third of the estate in probate duties. Some people are turning their eyes to New Zealand. I do not know what the probate duties may be there, but I know that in the case of the Argentine Republic taxes are greater than those imposed in Australia, though not much greater than will be imposed here when this Bill becomes law, coupled with the recently-imposed probate duties. When men consider that they have made sufficient money to keep them for the rest of their lives, they leave the Argentine. They say that they would go anywhere rather than give up to the State half the money that they have provided for their children. The probate duties there are nearly half the value of large estates. The result of this heavy taxation has been that, in all parte of the British Empire, men can be met who have made money in the Argentine, and taken it elsewhere to spend it. The time is coming when we should realize our responsibilities to the men who have made their money in Australia. In nineteen cases out of twenty these individuals are prepared to meet their responsibilities to the State, and we should treat them in such a way that, theywill continue to pay their rightful share of the taxation of the State and not overtax them to such an extent that they will find it necessary to go anywhere else in order to escape it. It is quite possible to impose such heavy taxation as will defeat the object of the tax. It may be too heavy for the people to bear, and it may also prevent people from making the incomes which otherwise would be made. The effect of the taxes we are imposing on big incomes will be to drive people out of the country, and in consequence Australia will be so much the poorer.
– We have heard all that long ago.
– There are many good things we have heard long ago, but, unfortunately, some of the supporters of the Government hear good things all their lives, and do not realize the application of them. The time will come in Australia when we will drive out all the solid people. No matter from what stratum of society a man may spring, if he settles in this country, prospers, and leaves his money to his children, the community reaps a real advantage, and it would prove a grave and growing danger if we were not to encourage such men by giving them what, after all, is only fair play.
.- I must express surprise that the AttorneyGeneral has given us no information as to the precise nature of the amendment he has promised to insert for the purpose of limiting the operation of this tax to one year. The honorable gentleman could not accept the suggestion made by the honorable member for Balaclava, but was prepared to draft an amendment which would have the effect desired ; and as ample time has now been given for consideration, it would save much discussion if he were to reveal the way in which he proposes to redeem the promise he made this morning. We have a right to know exactly where we stand. There is an obvious necessity for limiting the operation of the Bill to twelve months. This would save a great deal of unrest, and satisfy the public that the Bill is meant to be what it purports to be, namely, a war measure. In view of the circumstances under which we meet this afternoon, I should like permission to continue my speech on a future occasion.
– Is it the pleasure of the House that the honorable member have leave to resume his speech on a future occasion?
– I made the request from no personal desire, but merely because I thought that, if granted, it would suit the convenience of the House.
– I think we ought to adjourn now.
– Play the game!
– The honorable member never played the game in his life!
– If these interjections and exchanges across the Chamber do not stop, I shall have to take means to prevent them, from whatever side of the House they may come.
– If we pass the third reading now, I understand that no amendment can be made until the Bill goes to another place, and as it was introduced in this House, we have a right to see that it leaves us in perfect form. When a promise such as that of the Attorney-General has been made it ought to be fulfilled. We all know that this taxation is going to be very heavy, and that its disadvantages to the taxpayer will prove numerous. A measure of the kind ought to be enacted from time to time, according to varying circumstances, and if it were limited to twelve months I presume it would meet the requirements of the Government. Next year the exigencies of the situation may be greater, or not so great as they are now, and the amendment suggested would enable us to then amend the Act accordingly. I do not think that there is an honorable member on this side prepared to allow the Bill to leave this Chamber until the Attorney-General has inserted the promised amendment.
– Has the AttorneyGeneral made the promise?
– He definitely made the promise to the honorable member for Balaclava.
– If we pass the third reading now the Bill will be out of the Attorney-General’s hands.
– The AttorneyGeneral never made the promise.
– He did, this morning.
– I assert that the AttorneyGeneral made a distinct and positive promise that an amendment of the sort would be introduced.
– The Attorney-General said he would consider the matter.
– He said he would alter the Bill.
– I think that some honorable gentleman with Ministerial authority ought to see that the AttorneyGeneral, who is now absent, is brought into the chamber to repeat his statement.
– Let us at least know what the Government’s intentions are before the third reading is passed.
– The heavy nature of the taxation, more particularly as regards rich men, will seriously affect enterprise and the labour market.
– Is the honorable member in order in reading his speech?
– I do not understand that the honorable member for Echuca is rending his speech, but, if so, he is out oi order.
– I regard that as an impudent interjection, seeing that I had not read a line.
-The honorable member must withdraw the word “ impudent.”
– I withdraw the word, and say that the interjection was unworthy.
– The AttorneyGeneral is now present; what about his promise?
– I wish to remind the Attorney-General of the definite promise he made to the honorable member for Balaclava this morning, when the latter suggested an amendment with the object of limiting the scope of the Bill to twelve months.
– I have given an assurance twice. Do you expect me to give it three times?
– What are you going to do?
– I said I would make the alteration.
– In another place.
– It is a money Bill - a taxation Bill - and you cannot make an alteration there.
– Of course I can.
– The House ought toknow the precise nature of the suggested amendment, and, if we are told that, I shall be perfectly satisfied.
– Might I ask a question ?
– I shall not answer ft question, but, if I am allowed, I shall get up and say something.
– Do I understand that the Attorney-General fails to ratify a promise made to this Chamber ?
– Is the honorable member for Echuca in order in imputing an improper motive to the Attorney-General ?
– What is the improper motive?
– The honorable member for Echuca said that the Attorney-General did not intend to carry out the promise he made to the honorable member for Balaclava.
– I did not catch what the honorable member for Echuca said, but if he was imputing an improper motive to the Attorney-General he must withdraw the imputation. I point out that the Attorney-General, within the last three minutes, has twice repeated that he intends to do something that the honorable member desires.
– Yes, afterwards - that is the point.
– The AttorneyGeneral says that in another place he will do what he has promised.
– After what happened this morning, what guarantee have we that the Attorney-General’s party will support him ?
– May I be permitted to remind the honorable member for Flinders, who says that the Attorney-General cannot do what he has promised in another place, that the Senate can suggest amendments in the Bill?
– I asked what guarantee have we that the AttorneyGeneral will be supported by his party - that the promise will be honored by his party - after what happened this morning?
– Mr. Speaker-
– One moment. I must ask honorable members to conduct this debate in proper order. I desire to point out that, so far as the amendment referred to is concerned, it could not be moved on the motion before us.
– If I have said anything that appears to reflect on the bona fides of the Attorney-General, I withdraw if. In my opinion, the proper way is to have the amendment made here, and I can see no reason why it should not be. The method suggested by the AttorneyGeneral is somewhat doubtful, inasmuch as this House has no control over another place, and we have the right to safeguard ourselves. However, now that the Attorney-General has given an assurance, I am satisfied for the time being.
– On the point of order raised just now, I desire, Mr. Speaker, to call your attention to May, 11th edition, page 501.
– Is the ‘honorable member raising a point of order ?
– Yes. You, Mr. Speaker, took occasion to inform me that it was impossible for the AttorneyGeneral, at this -stage, to carry out his promise by moving an amendment. Under, I think, standing order 183 it is quite true that a Bill must be recommitted before the Order of the Day is called on; but, with such a standing order, the practice in the House of Commons, which we are directed to follow when not otherwise inconsistent with our procedure, is set out in May at the page mentioned. After stating that, by standing order No. 42, verbal amendments only can be made to a Bill on the third reading, May goes on to say -
When material amendments are desirable, the order for the third reading of the Bill may be discharged, and the Bill recommitted to introduce the amendments in Committee.
– With your consent that can be done, but, without your consent, it cannot.
– We wish it to be done.
– Then why not tell your people to sit down, and shut up ?
– Will you do it?
– There are three points to which I shall very briefly address my remarks. The first is the statement made by several honorable members that the method of the schedule is complex, leaving the taxpayer in an atmosphere of doubt as to how much he has to pay. We are asked to adopt in place of it the system of gradations operating in the States. Several honorable members have urged that course upon me with very great force. I admit that, on the face of it, the system adopted in the States is more simple, but it is illogical and unjust. It makes a man who is at the beginning of his particular class pay much more than the man who is at the end of the preceding class, so that a man who receives £999 pays, say, 4d. in the £1, while the man receiving £1,000 pays 5d. or 6d. in the £1. That is a strong inducement to men to understate their income. In any case, it is grossly unfair, and the only argument in its favour is that it is easy to understand. The system adopted in this Bill is scientifically regulated and absolutely just. A man pays exactly on the amount of income he receives; he has no inducement to understate that income. The incidence of taxation proceeds on an even curve of increases, the rate of tax increasing with each additional £1 of income. I much prefer the system we have adopted. It is scientific, logical, and fair. I cannot believe that there can be any confusion in the minds of the public, in view of the very plain statement of the effects of the Bill set out in the schedule. I desire to make perfectly clear to the taxpayers, who are very seriously concerned in this matter, exactly what their position is. This brings me to the point raised by the honorable member for Corangamite, who desired to know the position of a taxpayer who was in receipt of an income of £2,500. I ask the honorable member to look at the schedule, which is to be distinguished from the footnote. The latter is published longitudinally, and is not part of the schedule, but merely an illustration of its effect. In the footnote is set out the actual amount of tax paid per £1 on every £1 of income, whereas in the schedule itself there is set out the rate of tax levied on the last £1 of income. The difference is fundamental. The third point I desire to touch upon is the suggestion of the honorable member for Balaclava, and other honorable members, that this rate of tax should operate for one year. I understand that in the United Kingdom the practice is to reimpose the income tax every year, readjusting the rates as the circumstances from time to time demand. An income tax has long been regarded as the most flexible and convenient form of meeting fluctuations of revenue. It can be made light when the revenue is coming to hand freely from other sources, and heavier when the revenue declines or the expenditure increases. There is considerable doubt as to the amount of revenue we shall derive from this tax, owing, as I pointed out in Committee, to the absence of data. I think it fair and proper that we should have an opportunity, in the light of one year’s experience of the tax, to adjust it to the circumstances obtaining at that time. That proposition is fair and reasonable, and I am perfectly content to adopt it, but the question arises as to how that may be done. I submit that, with the consent of the House, an amendment can be made by striking out the words “ and each financial year thereafter.” That amendment will meet the circumstances of the present occasion. I wish to make that amendment, if I may be permitted to do so.
– I would point out to honorable members that we seem to be adopting methods of conducting business that are scarcely creditable to the House, which does not seem to know precisely where it is. We have now passed the stage when this Bill can be recommitted in the ordinary way, and if the Standing
Orders are to be ignored honorable members will see the difficulty in which I shall be placed. I may give a ruling one minute, and in the next the House may agree upon a course which will have the effect of setting my ruling at nought. If the House is going to continue this irregular course of procedure, I do not see that the Standing Orders will be of much use to me. If it is the desire of the House that the Attorney-General shall have leave to withdraw the motion that has been under discussion for the last four hours, I am entirely in its hands; but I would suggest that on an occasion like this the House should take the course of suspending the Standing Orders, so that its business can be conducted properly. I ask the House to help me in maintaining order and the proper conduct of business, for if irregular methods are adopted, my efforts to keep order or to interpret the Standing Orders, so as to secure the proper conduct of debate, will not be of much avail. Is it the pleasure of the House that the honorable member have leave to withdraw the motion for the third reading of the Bill?
Motion, by leave, withdrawn.
Motion (by Mr. Hughes) agreed to -
That the Bill be recommitted for the reconsideration of clause 5.
In Committee (Recommittal) :
Clause 5 -
Income tax shall be levied in and for the financial year beginning on the first day of July, One thousand nine hundred and fifteen, and each financial year thereafter.
Amendment (by Mr. Hughes) agreed to-
That the words “ and each financial year thereafter” be left out.
Clause, as amended, agreed to.
Bill reported with a further amendment, and report adopted.
Bill read a third time.
Bill returned from the Senate without amendment.
Motion (by Mr. Hughes) agreed to -
That the House, at its rising, adjourn until
House adjourned at 3.32 p.m.
Cite as: Australia, House of Representatives, Debates, 2 September 1915, viewed 22 October 2017, <http://historichansard.net/hofreps/1915/19150902_reps_6_78/>.