14th Parliament · 1st Session
Mr. Speaker (Hon. Gr. J. Bell) took the chair at 2.30 p.m., and read prayers.
Motion (by Mr. Lyons) agreed to - That t 1, c House, at its rising, adjourn until 10. U0 a.ni. to-morrow.
– Press reports state that Senator A. J. McLachlan is calling a conference of senior mining officials of the States, to be held in Melbourne, with a view to gold-mining in Australia being placed on an industrial basis. I ask the Prime Minister whether Sir David Rivett has been invited to attend that conference. Will an invitation also be extended to honorable members who represent electorates in which goldmining is carried on, and will the report of the conference be laid on the table of this House for the information of honorable members generally?
– The honorable member was good enough to notify me that he proposed to ask this question. A conference of Ministers and technical officers representing the Commonwealth and the States has been called to take place in Melbourne on the 28th October, for the purpose of reviewing the metalliferous mining assistance scheme and affording an opportunity for an exchange of views in regard to it. That scheme, in relation to the Commonwealth Government, is covered hy the Loan Appropriation (Unemployment Relief) Act No. 66 of 1934, providing for grants to the States for the assistance of metalliferous mining, to an amount of ?283,750, and for the provision for similar purposes- of a sum of ?50,000’ for the Northern Territory. Sir David Rivett has’ been invited to attend the conference, representation at which will be confined to Ministers and technical officers. The House will bc informed in due course of the results of the conference.
– As the States have spent only ?150,000 of the ?333,750 appropriated out of Commonwealth revenues far the assistance of metalliferous mining, will the Government consider whether they should be allowed to apportion part of the balance to the equipment of gold mines?
– The suggestion of the honorable member will receive consideration. It may be raised at the conference to which the Prime Minister has alluded.
– I ask the Minister for Defence whether the Dominion of New Zealand is a subscriber to the International Aif Convention? Does the Government of that dominion propose to take action against Mr. O’Hara for having made his recent trans-Tasman flight in opposition to official instructions in Australia, and will action be taken by the Commonwealth Government in conjunction with the Government of New Zealand to prevent the return flight, which press reports state is projected by this gentleman?
Mr. ARCHDALE PARKHILL.Mr. O’Hara’s flight from Australia to New Zealand in a machine for which he did not obtain a certificate of airworthiness was reported to the Government of New Zealand as a signatory to the International Air Convention, with the idea that it would take action in regard to the matter. That is the usual procedure. I have seen the newspaper report that Mr. O’Hara proposes to make a return flight to Australia, but have no information beyond that on the subject. If he does so, action will be taken against him upon his arrival in this country.
– Will the Minister for Trade and Customs state when the conference will be held that will discuss his recommendations concerning the price that must be paid for grapes by winemakers if they are to participate in the export bounty, and whether he intends to await the results of that conference before coming to a decision upon the request made by some wine-makers during the last few months for a variation of the price of fortifying spirit?
– The conference to which the honorable member refers is customarily held in January of each year. I n thelast two years an agreementhas not been reached in relation to the price to be paid for grapes, and the decision has been left with the Minister. I intend, on this occasion, also, to await the result of the conference before making a decision in this matter, as well as upon the request for a variation of the price of fortifying spirit.
Mr.BRENNAN. - Does the Prime Minister propose to have the Statute of Westminster ratified by this Parliament? I f so, when ?
– The matter has not yet been considered by the Government. Consideration will, however, be given to it, and a statement of the Government’s intentions will be made.
– In view of the substantial reduction of the cash reserves of the trading banks, has the Treasurer’s attention been directed to the recent controversy proceeding in the columns of the Melbourne Argus and the Melbourne Herald as to the best means of increasing these reserves? If so, does the Minister subscribe to the view expressed by the Argus that an increase can he brought about by raising the rate of interest on fixed deposits?
-I am aware of the public remarks that have been made on this subject, but the only comment I am disposed to make is that it is not at the moment a matter of Government concern. The situation is being watched very carefully, but I assure the honorable member that it is in no way serious.
-An appeal will shortly be heard before the Privy Council involving the validity of certain Common wealth marketing legislation, the particular case being that of James v. The Commonwealth. In view of the importance of this matter to Australia, will the Attorney-General state whether he will represent the Commonwealth at the hearing in London, and whether any States other than New South Wales and Victoria will be represented ?
– I am obliged to the honorable member for the invitation to appear for the Commonwealth, but all I can say at this stage is that the Commonwealth will be represented at the proceedings before the Privy Council. As for the States, I have been given to understand unofficially that most, if not all, of the States will also be represented.
– Will the Minister representing the Postmaster-General state what action is being taken by the department to deal with complaints arising out of the alteration of wave lengths?
– The only answer I can give is that, as difficulties occur, the technical officers of the department endeavour to remove them.
– Can the Minister for Defence state whether it is a fact that three Australian destroyers left Fremantle yesterday? Can he state the destination of these vessels, and can he give the House an assurance that they will remain in Australian waters?
– As I have previously indicated, it is not in the public interest at the present time and in the present circumstances to supply information regarding the movements of naval vessels.
– For what reason does the Government maintain secrecy regarding the movements of the vessels of the Royal Australian Navy, seeing that Australia is not at war with any other country ?
– I have already answered that question. I stated that, in view of the disturbed conditions in the world to-day, secrecy in this matter is regarded as essential.
– Is the Prime Minister aware that it was announced in Japan, after the conclusion of negotiations between Japanese representatives and the Minister directing negotiations for Trade
Treaties (Sir Henry Gullett), that both governments had agreed to keep the matter absolutely secret, and that Japan, therefore, was not free to explain what that country was demanding from Australia? Is it just that the people of Australia should be kept in ignorance of matters so vitally affecting employment? Will the Prime Minister state where the Minister directing these negotiations is at the present time, and when he is expected back in Australia?
– Only a little while ago L supplied information regarding the movements of the Minister referred to, and stated that he was to leave for Australia about the 26th of this month. As for the other part of the honorable member’s question, he must be well aware, as is everybody else, that negotiations in respect of trade treaties cannot be carried on in public. The discussions themselves must be confidential, but when the negotiations are completed, the agreement reached will be submitted to this Parliament for consideration.
– In view of the reports of unemployment following upon the closing down of the Golden Dyke mine in the Northern Territory, will the Minister for the Interior consider the advisability of making further advances of capital to this mine, seeing that it has been proved by a world authority? “Will he also see that assistance is given to establish portable ball mills in the locality for the benefit of isolated miners?
– Consideration is being given to the case of the Golden Dyke mine. As for the provision of portable ball mills, I hope that I shall be able to give the honorable member some information in regard to the provision of batteries generally in a few days’ time.
– Some time ago applications were invited by advertisement from young men desiring to enter the Public Service as cadet clerks in New Guinea. Can the Prime Minister say how many applications were received, how many appointments will be made, and who are the successful applicants?
– I cannot give the honorable member offhand the information he requires, but I shall obtain it for him.
– Is there any rule or regulation in force in the Federal Capital Territory which prevents persons other than public servants from renting government-owned houses that become vacant from time to time?
– The practice is to give public servants preference in this matter, and it is only when more homes are available than are needed by public servants that any can be made available for other persons.
– In view of the serious position of the pearling industry at Broome, due to the low price of shell, and to the disorganization caused by the hurricane early in the year, when 21 luggers were lost, will the Minister for Trade and Customs expedite the preparation of the report of the Tariff Board on the industry?
– The Government has already made a grant for the relief of distress occasioned by the hurricane. As for the Tariff Board inquiry, the report of the board has been received, and will shortly be considered by the Government.
– In view of the reported finding, refunding and still further confirmation of the finding of Lasseter’s reef in Central Australia, will the Minister for Defence have inquiries made, and lay on the table of the House the naval record of one Hummerston, if it is proved on police investigation that this Hummerston, who obtained money in Sydney after producing specimens and declaring that he had found Lasseter’s reef, saw service in the Australian Navy?
-I shall make inquiries, and advise the honorable member later.
– Has the Minister for the Interior noticed the report in yesterday’s Melbourne Age which said that the Commonwealth railway employees “will hold a meeting to-morrow night at Kalgoorlie to decide what action they will take upon what they regard as their disabilities in connexion with payment for Sunday work? If so, will the Minister make a report to the House on the matter?
– I have not seen the report in the newspaper to which reference has been made.
Motion (by Dr. Earle Page) agreed to - .
That ho have leave to bring in a bill for an net to provide for the payment of a bounty on the export of oranges from the Commonwealth to the United Kingdom.
Motion (by Dr. Earle Page) agreed to- -
That he have leave to bring in a bill for an act relating to trade and commerce with other countries and among the States in wheat and wheat products.
In committee: Consideration resumed from the 22nd October (vide page 936).
Clause 4 -
Each of the following schedules, that is to say, the first schedule to the Sales Taw Assessment Act (No. 1) 1930-1934, as amended by the Sales Tam Assessment Act (No. 1) ] 1)3-5, the schedule to the Sates Tam Assessment Act (No. 2) 1930-1934 and the schedule to Sales Taw Assessment Act (No: 3) 1930-1934, is amended- (ad) by inserting . . . the item - “ Goods which are for the official use of, and are not for re-sale by, a technical school the expenditure of which is wholly or partly borne by the Government of the Commonwealth or the government of a State; “;
Upon which Mr. Garden had moved by way of amendment -
That the words “or institutions for educational purposes,” be added.
.- I was surprised at the Treasurer (Mr. Casey) raising objection to my amendment to add to paragraph ad the words “or institutions for educational purposes.” I believe that there are only 10 technical schools, apart from government and semi- government technical schools, so it cannot be said that my amendment is of a farreaching character. One of the institutions which would be relieved of sales tax under the amendment provides for the training of deaf and dumb persons. Surely such an institution should receive special consideration. It is not asking much to suggest that the apparatus purchased by it should be free from this tax. The cost of the remission would not be more than £150 to’ £200 a year. The department would not miss that comparatively small sum, but the remission would relieve the institutions concerned of a considerable burden. My amendment is limited to materials purchased by technical schools, and does not apply to secondary schools generally.
– The amendment provides for about as wide an exemption as could possibly be framed. I point out to the honorable member that deaf and dumb institutions in New South Wales and elsewhere will have complete exemption, because they will come under the heading “ public benevolent institutions.” All schools conducted entirely at the expense of governments, State or Federal, have complete exemption from sales tax on supplies not intended for re-sale. This exemption applies to all State schools. If the exemption were widened, however, as proposed by the honorable member for Cook (Mr. Garden), all other educational institutions, such as the Sydney and Melbourne Grammar Schools, and the Wesley, Scotch and Geelong Colleges, Melbourne, would have complete immunity from the tax. Educational books and a wide range of scientific instruments are already on the exempted list. I regret that the Government is unable to accept an amendment of this sort.
– What loss to the revenue would be involved by the acceptance of the amendment?
– Heaven knows what loss of revenue would be involved. Furthermore, if it were accepted a great deal of investigation’ would be necessary to avoid competitive and working anomalies. When the Commonwealth has revenue to spare ‘and can afford to bring down a further list of exemptions, I SUK gest to the honorable member for Cook that exemptions will be extended to quite a. number of items before that which he has brought forward is included. As the Government has to bring down lists of exemptions in their orderof urgency or order of merit, I ask the honorable member for Cook not to press his amendment to a division because the Government is unable to accept an amendment of this character, and is obliged to confine the exemption to one specifically directed towards ‘technical schools.
.- I understood the Treasurer (Mr. Casey) to state that educational books of all classes are free of sales tax.
– As educational books, yes.
– I have found great difficulty in procuring books for many children because it seems that the cost of education is being raised unduly and unjustly, and I should like a definite assurance from the Treasurer that all books are free of this tax.
– I shall ascertain from the technical officers of the department if my statement is correct and advise the honorable member shortly.
.- I support the amendment moved by the honorable member for Cook (Mr. Garden). I am unable to understand the request of t he Treasurer (Mr. Casey) that it should not be persisted in. Provision is made to exempt goods sold to schools conducted by Commonwealth and State education authorities or subsidized by the Commonwealth or State Governments. But which schools are best ‘able to bear this tax? Those conducted or subsidized by the States, or those privately conducted and maintained? I do not think the Treasurer has given much consideration to the needs of those people who conduct unsubsidized schools and experience great difficulty in making income meet expenditure. Why is not the honorable member prepared to extend to such schools the privilege that is proposed to be extended to schools subsidized by governments? Although I hesitate to say it, in the face of the Treasurer’s opposition, there seems to be more in this matter than appears on the surface. The attitude of the Treasurer seems to confirm this. In any second-reading speech on this bill, I asked a question regarding the extension of the exemption to privatelyconducted schools, and the Treasurer, though he promised to reply, absolutely ignored it, with the result that the matter has been brought forward by the honorable member for Cook. Thehonorable member is to be congratulated for having brought it forward. These nonsubsidized secondary and technical schools are undoubtedly rendering a great service to the community, and those people who support them financially are also taxpayers. Sales tax should at least be removed from the requirements of these schools. Moreover, they are very few in number, and would not amount to more than ten or twelve in any one State, so that the loss of revenue, if the amendment were accepted, would be very small. The Treasurer has seen fit to remove the tax on school requisites, such as measuring glasses, wood-working apparatus and other equipment in respect of subsidized schools. We must not lose sight of the fact that many of the schools which the honorable member for Cook desires to include in the exemption provide board and lodging for students who come from the far-flung parts of Australia. Sales tax is therefore payable on many commodities. If the Treasurer persists in refusing to accept this amendment, he will be discriminating between one section of the community and another. Members on both sides of the House are interested in this matter and many of them who have attended functions at these schools have been amazed at the work which they carry on. I, myself, have had the privilege of seeing the work carried out in some ofthese technical schools. In Maitland a secondary and technical school conducted by the Marist Brothers is undoubtedly carrying on good work. Whether or not these schools are conducted by different denominations, provision should be made for the exemption from tax of all the commodities they require. I again appeal to the Treasurer to give this matter further consideration ; otherwise, we may press for a vote and the honorable member will find that many members sitting behind the Government will support the amendment.
– I have now had an opportunity to confirm with the technical officers of the department the accuracy of the statement which I have just made to the honorable member for Melbourne (Dr. Maloney) that all classes of educational books, including copy-books and atlases, are entirely free of sales tax.
– That strengthens our case.
– What about scientific instruments.
– A certain list of scientific instruments is free. I can assure the honorable member for Hunter (Mr. James) that there is no sinister design on the part of the Government in refusing to accept the amendment of the honorable member for Cook (Mr. Garden). The exemption proposed is a slight and logical extension of the existing exemptions to State schools or schools run entirely by governments. Whether the government is a small or a large contributor towards the expense of existing technical schools it is bringing those schools within the ambit of the exemption.
.- The honorable member for Cook (Mr. Garden) has made out a strong case for the exemption of goods for the use of technical schools not supported by any government subsidy, and. the Minister’s reply to his arguments was quite ineffective. Why should the relief now proposed to be given apply only to schools and colleges supported by the Government? Attention has been directed by the mover of the amendment, and also by the honorable member for Hunter (Mr. James), to certain privatelyconducted institutions in their electorates which are fulfilling an exactly similar function to that of government-supported technical colleges. As the financial needs of the government-supported colleges can be provided for each year when the budget is introduced, whereas no similar provision can be made for schools and colleges not supported by the Government, the latter class are in more need of assistance than the former. I trust that the Treasurer (Mr. Casey) will not be adamant on this point. The request that has been made i3 entirely reason able. It is no answer to the contention of the mover of the amendment to saythat educational books are exempt from sales tax. If the Government’s proposed extension of the exemption is agreed to, an unfair discrimination will be made between colleges supported by government subsidies and those not so supported. An institution on one side of a city road might be able to obtain its technical equipment, such as wood-working machinery and the like, free of sales tax, whereas a similar institution on the other side of the road may have to pay sales tax on such equipment. I appeal to the Treasurer to relent on this point.
– I direct attention to paragraph ac of this clause, and ask the Treasurer to extend it to cover certain hospitals not strictly public in character, but which nevertheless relieve the congestion at public hospitals to a very great extern.. All our public hospitals arc supported by government subsidies, but the various denominational hospitals that I have in mind are not so supported. Sonic denominational hospitals, such as that at Lewisham, and also the St. Vincent’s Hospital, are being paid a government subsidy, and so will obtain relief if paragraph ac, as drafted, is agreed to; but many other denominational hospitals registered as non-profit-making concerns should also be brought within the exemption. I have in mind St. Luke’s Hospital, Darlinghurst, which has been registered for 85 beds, and is now seeking an increase of that figure to 100. Such a hospital must obviously relieve the pressure on public- institutions. I refer, also, to the Methodist Memorial Hospital, Waverley, and the Scottish Hospital. Paddington. These are but a few of many that could be mentioned. ! suggest that the words “or denominational hospital not run for profit” bo included in the provision.
I now direct attention to paragraph ah. under which exemption is granted to certain linotypes, electrotypes, electrotype moulds, stereotypes, and matrices. I understand that printed music is exempt from sales tax, but that music reproduced from stereotyped blocks is not exempt. I ask the Treasurer (Mr.
Casey) to make tins small concession in the interests of the music-loving public. To do so would not cause the Treasury any financial embarrassment, nor would it create any anomalies; in fact, it seems to me that it would remove an anomaly.
I urge the Treasurer to give favorable consideration to the two requests that i have made.
– While 1 do not think that the honorable member for Wentworth (Mr. K. J. Harrison) would expect me to remember the names of the hospitals and institutions that are being granted a general exemption from sales tax, I am. able to inform him that all public hospitals and benevolent institutions, all homes for the aged and infirm, all industrial homes and asylums, all institutions for the deaf, dumb and Wind, all Red Cross and hospital comfort committees, and also church missions performing social services will be exempt from sales tax in respect of goods they ‘buy for use. The exemption now being made will also cover purchases made by hospital auxiliary committees for use in hospitals, and goods not specifically exempt acquired by contractors for the carrying out of building contracts for public benevolent institutions. The list of exempt institutions compiled by tho department is generally satisfactory to all concerned. In view of the almost infinite variety of institutions working for the alleviation of human suffering, it is not possible to frame a. precise definition that will cover every kind of institution. 1 am glad that the honorable member for Wentworth referred to paragraph ah for it gives me the opportunity to dispel :i misapprehension brought under my notice only this morning. There appears to be an idea that this paragraph will cover linotype machines, but that is not sn, and I should like the widest publicity io be given to this statement. The exemption provided in paragraph ah is not intended to ‘benefit our so-called rich newspaper friends. The materials that go to make up linotype metal are taxable, but clearly it would be unfair to charge sales tax on the hard lead alloy that goes into the linotype metal every time it is used for the casting of new type. Quite early in the history of sales tax, this exemption was allowed because of the practical im possibility of administering the tu. otherwise, and it is only to clear up h legal doubt that this item has been included in the exemptions. But it is merely the type cast by a linotype machine and not the linotype machine itself, because that type is cast and remelted dozens of times a week. I can assure the honorable member for Wentworth that stereotype for the production of music will be exempt under these proposals.
– Speaking to the amendment moved by ibo honorable member for Cook (Mr. Garden), I take it that, in the first instance, this exemption has been provided to give effect to the principle the Government has adopted of assisting education by making educational facilities for the youth of this country, as fret’ and unrestricted as possible, and accepting the declaration made by the Treasurer (Mr. Casey) to the honorable member for Melbourne (Dr. Maloney) that all educational requirements in the sense of their use for primary education are exempt from sales lax, I think we can take it that, irrespective of a school being owned or controlled or subsidized either by a State or the Commonwealth, any of its requisites should be free from this tax.
– The principle, I admit, is good, but is not applicable to this bill.
– The implication ongathered from the reply of the Treasurer to the honorable member for Melbourne was that sales tax does not apply, irrespective of the school where those requisites-
– Books !
– Well books, if you like - are intended for educational requirements, and irrespective of whether the school is financed by a subsidy, or by the Commonwealth or a State government.
– That is quite correct.
– Then why has discrimination been made in regard to technical education?
– There is no discrimination.
– What other description can be applied? Why is this paragraph drafted to discriminate between primary and technical schools? The
Treasurer admits in tlie first instance - no doubt based on the guiding principle of unrestricted educational facilities- - that he should follow the practice of refraining from imposing sales tax on the requisites of primary schools, but he allows the tax to remain in the case of technical schools.. That requires some explanation, and it is not sufficient to dismiss it lightly. The honorable member for Hunter (Mr. James) has asked the reason for this discrimination, and ho should be supplied with an answer. The Treasurer stated that it would involve the revenue in a sum which he could not estimate. That is an unsatisfactory statement. As a rule when a Minister sets out to buttress his contentions, he can quote details and figures supplied by his department, but on this occasion the Treasurer brushed aside the query with the simple statement that an unknown sum of money would be involved. I doubt whether, if the Treasurer were sitting on this side of the House, he would be content with such an indefinite reply. His approach to this subject was based on the wording of the amendment. Actually, the purpose of the honorable member who moved it is to deal solely with technical education. The Treasurer’s attitude justifies one in examining the clauses of this bill and drawing attention to the many exemptions being made, such as rugs for sheep and pigs. Why preference has been given to rugs for sheep and pigs over technical educational facilities I do not .profess to understand. Apparently it will be a long time before the Government can consider the suggestion of the honorable member for Cook as ranking higher in importance than other requests that may be lodged from time to time. The Treasurer’s reply does not break down the case that we have put up in this connexion. Quite re number of denominations are engaging in the most valuable work of technical education. The honorable member for Wentworth (Mr. E. <T. Harrison) referred to the hospital work,, and I endorse his remarks that every credit must be given to those who devote their lives and services, without thought of any remuneration whatever, to nursing the poor and the sick. Striking examples of this noble work can be quoted. But what they are doing in the hospitals is also being done in technical and primary education. If honorable members visit the poorest paris of Sydney,, they will find a technical education being provided under exceptional difficulties. In order to obtain tools, scientific materials and other requisites, there is a struggle to save every penny. These institutions constantly seek our aid in conducting entertainments to provide equipment for th« various, sections - plumbing, carpentering and others. They are screwing and scraping, yet they receive no reward from the Government for the great services that they are rendering to this country and *o the poor of the community. We arc waging this fight on behalf of the poorer sections of the community, whose boys and girls are compelled to attend denominational schools, in many cases probably because these are nearest to their homos and they cannot afford the cost of transport to obtain education further afield. The discrimination practised in this matter is extraordinary, and has not so far been justified. I invite members of of all parties to dismiss the case made out by the Government. I believe that I have approached this matter in a reasonable frame of mind. I suggest that the Treasurer should further discuss it with the officers of the department and, should he realize the justice of our claim, take steps to make the proposed exemption general in its application. The honorable member has brushed us aside, and will not listen to our representations. I cannot admit that in this instance he has earned the credit which in the past we have been able to accord to him for his handling of the matters with which he has been entrusted. I again urge honorable members to see that denominational schools receive the same treatment in regard to sales tax. exemptions as those which are subsidized by the State.
– The honorable member for West Sydney (Mr. Beasley) has sought to make out a case against me, based generally on the ground that I have attempted to brush this matter aside without adequate consideration, and almost, one might think, without reasonable courtesy to the mover of the amendment. I protest against that attitude. I have already made a reasoned reply to the arguments advanced in support of the amendment.
There are many aspects from which this proposal could be viewed. There is the educational aspect, and also the aspect of the proportion of government assistance which these schools receive. The honorable member for West Sydney, legitimately for his own purpose, has chosen to adopt the viewpoint of education. I ask honorable members generally to regard the matter in this light:* There is an existing exemption in the ease of State schools. . From the administrative point of view certain embarrassment is felt in determining at times whether schools are State-maintained or are maintained by the parents of scholars. The Government is seeking to assist this limited class as well as to solve one of the administrative difficulties of the department. Nothing further is involved. A great deal is being done by governments in Australia for purposes of education. This Government has a certain amount of revenue that it can see its way to forgo. It has spread the loss over as wide and as justifiable a field as possible. That field happens to include a number of anomalies and administrative difficulties. Based on the very slender premise that this happens to have an educational flavour, the honorable member for West Sydney would make the exemption have a very wide application.
– How much would it cost?
– Heaven knows what it would cost. I am not able to accept that as a valid argument; eloquent though the appeal of the honorable member may be, it seems inapposite in the circumstances. The whole subject of education is involved. I am perfectly certain that the perspicacity of the honorable member for West Sydney and his friends is such that, having freed technical education from the incidence of the sales tax, they would extend their operations to cover the whole range of education. I have watched the honorable member for West Sydney with great respect, and know that he avails himself of every opportunity which arises. At the moment, because his purpose is thereby served, he is confining his atten tion to technical education. I have not the slightest doubtthat his next step would be to widen the scope of the exemptions to include primary and secondary education. I urge honorable members not to be carried away by his sentimental appeal, but to remember that this is merely one of a series of small anomalies that the Government is seeking to rectify.
– Will the Minister give the asurance that he will further consider the matter?
– I shall certainly consider the matter to ascertain the extent of its ramifications; but I shall bear in mind possible future ramifications which I know will emerge from the fertile brain of the honorable member for West Sydney.
.- I support the amendment of the honorable member for Cook (Mr. Garden). Education is the responsibility of the whole of the Commonwealth. So long as boys and girls are trained to be respectable and efficient, where their education is obtained does not matter. The scope of technical education must be widened to enable training to be given that will fit youths for the struggle of life. There are no apprentices to-day, nor could any be absorbed in industry, because there is no room for them. Why does this Government, which a month or two ago professed its willingness to promote the welfare of the boys and girls of Australia, refuse to include certain schools in the proposed exemption relating to technical education? The Treasurer (Mr. Casey) must be prejudiced and biased.
– I am not.
– The honorable gentleman’s attitude this afternoon proclaims his bias in a certain direction. He has adopted a narrow and parochial outlook. If we wish to improve the technical attainments of our youths we must widen the scope of technical education so that three or four years’ training may be given in different trades and callings. The Treasurer claims to be ignorant of the probable cost of the proposal which the committee is considering. The matter of technical training should not be narrowed down to a question of cost. So long as a person is a good citizen, the source of his education is not inquired into. In my electorate five or six colleges are providing technical training. The honorable member for Cook is to be commended for having brought this matter forward. The Treasurer has not disclosed the real reason for his refusal to accept the amendment. Why should not every child have the right to free education at any school he or she ma” choose to attend? The Great War broke down such barriers, and they should not be reerected.
.- Although I rise to support the amendment, I do not charge the Treasurer (Mr. Casey) with having refused to accept it. for ulterior motives. I am greatly concerned about the welfare of the youth of Australia. Travelling through different parts of New South Wales, I have come into contact with young men who, although possessing intermediate and leaving certificates, are engaged in sweeping gutters, and doing other work for which they are quite unsuitable. It is the duty of both the Commonwealth and the States to provide money for every form of education. The States having failed to apply for the whole of the amount allocated by the Commonwealth for public works, the Commonwealth should devote the balance to the establishment of depots for the education of youths in secondary callings, in which they may make a comfortable living, and prove worthy citizens in the years to come. Sales tax and other burdens which are hindering technical schools should be removed. Thousands of boys are to-day merely eking out. an existence on the meagre sum which they receive, and the hopelessness which they feel in regard to the future will be accentuated if they romain in that groove. I hope that the Treasurer will give serious consideration to the amendment, and will see his way to accept it even though it may involve some small loss of revenue.
.- 1 hope that members of the committee will not be side-tracked by the unwilling promise extracted from the Treasurer (Mr. Casey) that he will give consideration to this matter at some future dato. In the series of speeches delivered by him hist night and to-day, he has made it- clear that, even when amending sales lax bills are before Parliament in the future, many other matters will receive consideration before this one. It is idle, therefore, for the honorable member for Wentworth (Mr. E. J. Harrison) to pretend that we ought to be satisfied with the promise of the Minister that the point involved in this amendment will be considered. Having regard to the number of matter which, will receive preference over it, it is unlikely that this point will come up for consideration in the present Parliament.
The Treasurer sought to brush the matter of technical education aside as one of small importance. I remind him that all educationists of repute are dwelling with particular emphasis on the need for more and more technical education. Those technical schools in Australia which are to be granted exemption from sales tax under the Government’s provision are totally inadequate in number to supply the needs of Australian youth. There is an acute shortage of accommodation in such schools, and the shortagewould be greater still, were it not for the various denominational schools. In some of the government schools, the congestion is so great that classes of 60, 70 and 80 children under one teacher are not uncommon. The private schools are finding it extremely difficult to carry on because of shortage of funds, and are driven to all kinds of shifts in an endeavour to get money. Competitions are held from time to time for this purpose, periodical appeals are made to the public and entertainments are organized by the school authorities. Now the Government proposes, like Bill Sykes, to grab from the private schools, by way of sales tax, th«’ pennies which have been gathered with such difficulty. It is astounding to mc that any government should contemplate such a thing. In many cases, private school authorities are in constant anxiety from one week to another as to whether they will be able to carry on. If the Treasurer doubts me, let him investigate the position for himself; then he would never have the courage to proceed with this measure in its present form. TinTreasurer and his friends are able to send their children to the great public school.* and to the universities, but the children of the poor must get what advanced education they can from the technical schools or go without. State governments are not providing adequate educational facilities for all the children requiring them, and when the deficiency is made good .to some extent by private educational institutions, the Commonwealth proposes to tax them.
for his desire to ease the burden of taxation wherever possible, it seems to me that, in regard to this particular matter, he has not fully grasped the situation. In answer to the arguments of members of the Opposition, he has stated that the provision before the committee has been inserted merely to clear up an anomaly; but I remind him that, in the past, no anomaly existed. If there is an anomaly to be cleared up, it was he himself who created it. Moreover, he will perpetrate a grave injustice if he insists that those educational institutions which are not receiving assistance from the Government shall be taxed,, while those which do receive assistance are to go free. Many private educational institutions are conducted by charities and religious denominations, and do their work among the poorer sections of the community. Surely those schools that are wholly or partly maintained by government grants should be better able to pay sales tax than those which receive no assistance whatever! I’ appeal to the Treasurer temporarily to withdraw the clause, so that he may go carefully into the matter, and determine just what would be the effect of the amendment -if it were accepted. The Treasurer has expressed a fear that the amendment, if accepted, might involve a considerable loss of revenue; but I do not believe that it would, whereas its acceptance would be of great help to private educational institutions. As a matter of fact, these private schools are doing a work that the State governments should he paying for. That being so, it seems extraordinary that they should be taxed by the Commonwealth, while the State institutions go free. I support the amendment; but I suggest that the item be withdrawn for the time being for further consideration.
– I join with the honorable member for Wide Bay (Mr. Corser) in urging the Minister to withdraw the item temporarily .for the purpose of redrafting it. I do not think that the amount of revenue involved would be nearly so great as the Treasurer (Mr. Casey) seems to think. He referred to the difficulty of drawing a line of demarcation between those schools which charge f<;es, and those which do not. I do not think that exemption from sales tax should be granted to those private schools which are run for profit. There is no case for exemption of institutions such as business colleges, where regular fees are charged and collected.
– The Geelong Grammar School and kindred institutions are not run for profit.
– Nevertheless, they charge pretty stiff fees, in addition to which levies are made for sports, &c, and they annually turn over a lot of money. Some of them, perhaps, even make a profit. However, I am not now referring to schools of that kind at all. I understood that we were dealing with technical schools.
– Not in the terms of the amendment.
– I am asking for exemption only in the case of technical schools, and the number affected would be comparatively small. There are not many private or denominational schools in which technical education is given, but those which do give such education should be exempt from this tax. There never was a time in the history of Australia when the need, for technical education was greater than now. All authorities are agreed that we are drifting back as regards craftsmanship, due, largely, to the effects of the depression, and it is necessary that we take steps to increase the number of apprentices. Personally, T know of only a few schools which would be affected by this amendment. There is one in New South Wales run, I think, by the Catholic Christian Brothers, which gives technical education to deaf and dumb persons. Such persons attending public institutions receive their education free, with the assistance of government subsidies and private donations, and the institutions are exempt from sales tax. There is also a Catholic organization on Bathurst Island which is trying to teach the natives farming, and such occupations as timber-splitting, &c. On one occasion the Director of Penal Institutions in Victoria asked me if I could tell him where he could find a trained mat-maker to take charge of mat-making operations in one of the prisons. In no place outside the deaf and dumb institutions and similar institutions are people being trained in , th 1 S work. I know one religious organization in Sydney which gives instruction to deaf mutes in the manufacture of mats and baskets and in carpentry. Its work is carried on, not for profit, but solely for charitable purposes. The Opposition merely asks the Minister te relieve these institutions from the burden of sales tax upon goods used by them in giving technical instruction.
– Materials used by deaf and dumb institutions are already covered by the proposed exemptions.
– But the institutions to which I am referring are not relieved of the tax. Churches have special collections for the purpose of giving technical training to deaf mutes. I am sure that Methodist missions, for which 1 also have great respect, give training in technical subjects, including farm work, and if they purchase a few spades and shovels, and a harrow now and again-
– Practically all farming implements are exempted.
– From my experience, I am certain that there is now greater need than ever before to encourage technical training. As I was a member of the Apprenticeship Commission and the Council of Education in Victoria, I speak with some knowledge of the matter. Apart from the government schools, there are very few institutions that give technical instruction, and if the amendment were agreed to, there would bc no serious reduction of revenue.
– Some honorable members have lost sight of the real purpose of the exemption under discussion. Many Schools are entirely supported by State governments, and in a limited number of other cases the State governments make up the difference between the sum collected in fees and the total expenditure. Those are the technical schools to which this exemption is directed. If the Commonwealth Government charged sales tax on materials used by them, the State governments would have to make up a larger amount, and to the extent’ that we impose sales or any other tax on the materials purchased by those schools we shall increase the liability of the States and benefit the Commonwealth. The relations between the State and the Commonwealth governments are such that we are willing to step aside and relieve the State governments of liability to this tax. The representations in my mind are mainly those made by the Victorian Government. Honorable members opposite are on an emotional rather than a practical plane in expressing concern for the welfare of the children of Australia. I can assure them that the welfare of the working man is perfectly safe in the hands of the present Government. It is the working man, not the children, who pays the small amount of tax that may be involved under this measure. When the first Lyons Ministry came into power, it directed its efforts to the reduction of the burden of taxation on the man on the basic wage, and that policy has been pursued by the p resent Government to such an extent that it has reduced by 25 per cent, the average amount of sales tax paid by this section now as compared with the sum collected when it came into office.
– Yet the revenue from sales tax will be higher this year than in any previous year, except one.
– The honorable member could, if he desired, state the reason for that. Is the Government imposing a burden on the working man? Anybody entering this chamber and listening to this debate would imagine that the Government was attempting to impose an obligation rather than extend an existing privilege. The bill gives a reasonable and logical extension in favour of State governments, of an existing exemption. We are not attempting to rectify all the ills of the universe in this one measure.
With all modesty, I suggest to the honorable member for Wide Bay (Mr. Corser) that it is unnecessary to with- draw the item. I happen to have some knowledge of technical education, having personally received a technical training. Those of us who have been associated with taxation measures in this Parliament know that, whatever concession is given in respect of any tax, it is always possible to go a little further. I suggest that the Government is acting logically and rationally in this particular instance in favour of State governments, whilst honorable members opposite, in being given an inch, are attempting to take an eli. This, I contend, is not the time and place for putting forward arguments such as those so eloquently submitted by the honorable member for W est Sydney (Mr. Beasley) and his friends. I regret that the Government is unable to accept the amendment.
.- I support the amendment. Reference has been made by the Treasurer (Mr. Casey) to the need for exercising discrimination in taxation matters where State and Commonwealth, governments are concerned, but the unfortunate taxpayer has to carry the whole of the burden. Under the present proposal, some taxpayers have to pay twice, first to support the State government towards technical education, and then to pay tax on goods required for their own technical schools lt seems to me that the arguments advanced by the Treasurer in this case are not so logical as are his remarks on taxation matters generally. Perhaps the difficulty could be overcome by eliminating from the item all the words after the word “ school “, thus limiting the application of the exemption to technical schools. The training of the youth of Australia constitutes a serious problem. A vast army of young people leaves school each year and is condemned to unemployment. Consequently, there has been an increased demand for technical instruction. In New South “Wales the State authorities have refused youths admission to technical schools unless they are apprenticed to trades, and, therefore, a great number of them have no chance of employment unless they accept such relief work as is provided from time to time. The fact that the amendment would help schools that are open to youths who are excluded from the govern ment technical schools is sufficient reason why the Treasurer should accept it. In many cases, the parents of these youths are unemployed, and, of course, are quite unable to pay for their technical training.
.- I feel sure that the Treasurer (Mr. Casey) is seised with the importance of giving assistance as far as possible to technical schools. I bave listened with interest to the remarks of other honorable members on this important subject, and as far as I know only one technical school in New South Wales would benefit from the acceptance of the amendment; that is, the technical school at Castle Hill. Although I am under the impression that that school comes under the provisions of the exemption, I should like an assurance from the Treasurer that he will look into this matter, and if he finds that sales tax has to be paid in respect of equipment required by this school which is doing excellent work, I feel sure he will have the anomaly rectified. A number of members on this side agree with the views expressed by honorable members opposite in regard to the desirability of widening the scope of the exemption. I realize, ‘however, that the Treasurer is confronted with all kinds of anomalies in regard to the operation of the sales tax legislation, and I realize also that once a policy of granting exemptions is started it is difficult to call a halt. I feel sure that the Treasurer will survey the position in regard to schools in New South Wales, and other institutions, such as that mentioned by the honorable member for Melbourne Ports (Mr. Holloway), and will rectify any anomalies that exist.
– When I sought an assurance from the Treasurer (Mr. Casey) that he would give further consideration to these schools, my request was based on the assumption that no great sum would be involved by the acceptance of an extension of the exemption, and that if such were the case he might consider the introduction of an amendment in another place. Honorable members have made out, in the main, a case that calls for a .good deal of consideration. If the Treasurer feels that the wording of the amendment moved by the honorable member for Cook (Mr. Garden) is too wide, I mi ght suggest that a definition of the word “ technical “ should be considered. That in itself would limit entirely his consideration to schools of that description. I make no apology for endeavouring to prevail upon the Treasurer to grant further exemptions,because I am one of those who believe that the sales tax should be wiped out. Primarily, I consider that there is no longer the necessity for the continuance of this emergency tax, and I would take every step to remove this legislation from the statute-book, but I have no doubt the Treasurer feels it necessary to demand the continuance of this tax in order to meet the obligations of the Government. I suggest, however, that he should be willing to give consideration to the advisability of extending the exemption to cover purely technical schools and of adopting my suggestion that the word “ technical “ should be defined.
– I say again that I shall certainly have the matter considered.
– That assurance is not sufficient. Nine months ago the Treasurer stated that he would consider the matter of sales tax charged on freight.
– That matter was inquired into, and it was found that the tax could not be lifted. I give no indication that even if the matter now under discussion is considered, the request will be acceded to. In order to limit the discussion, however, I undertake to have the representations made by honorable members very carefully looked into, and referred to the Deputy Commissioners of Taxation in the States, who are the only people in. touch with education authorities. After consideration by the Deputy Commissioners, the matter will be submitted to the Government, and if it is possible to widen the exemption members will be so informed.
Question - That the words proposed to be added (Mr. Garden’s amendment) be so added - put. The committee divided. (Chairman - Mr. Prowse.)
Majority . . 7
Question so resolved in the negative.
.-I move -
That the following paragraph be inserted after paragraph (aak) : - (aaka)” Tugs which are for the use of har- bour boards and trusts or other quasigovernmental bodies or authorities such as municipal and shire councils, boards dealing with water supply and sewerage.”
The harbour boards of Queensland are operating under great hardship for they are obliged to pay sales tax, yet sales tax is not payable in connexion with the operations of the Brisbane harbour for it is under the control of the State Treasury. The harbour boards of the State, generally speaking, are not State instrumentalities in the ordinary sense. The secretary of the Rockhampton Harbour Board has written to me on this subject and pointed out that theboard has been called upon to pay sales tax on the cost of constructing a tug for the sole purpose of enabling it to carry out its programme of works. To my mind that is veryunfair. The construction of the tug provided work for quite a number of unemployed artisans and was a necessary undertaking to enable the board to carry out its programme of works. The board has also been obliged to pay sales fax on other items of plant constructed or under construction. It is anomalous that Brisbane harbour works should be exempt from sales tax while works in connexion with all the other harbours of the State are subject to it. The harbour boards of the various States are performing services for the benefit of not only the States in which they operate, but also the Commonwealth as a whole. The development and maintenance of harbour facilities are of prime consequence to the entire community. The Labour party is opposed to the imposition of sales tax on suchbodies. The policy of labour is decentralization, as far as possible. “We consider that goods should be shipped from their natural ports. It should be unnecessary to haul all produce to the capital cities. Three lines of railway run direct west in Queensland, and shipping facilities are available at Townsville, Rockhampton, and to some extent, Maryborough. It is unfair that the harbour boards at those various centres should be called upon to operate at a disadvantage compared with the authority which controls the Brisbane harbour. I have moved my amendment because the Rockhampton Harbour Board has requested me to bring this subject under the notice of the Treasurer and to urge t hat an appropriate alteration of the law be made to rectify its complaint.
– This clause is arranged in alphabetical order and the honorable member’s amendment wouldbe more appropriate at: a later stage.
– In the circumstances I ask leave temporarily to withdraw it, and I will move it later.
Amendment -by leave - temporarily withdrawn. (ad) by inserting after the item commenc- ing with the words “Goods sold” the item -
– I move -
That the following words be added to paragraph (ad) : - “ Goods bought for use and not for re-sale by municipal councils,roads boards, and statutory boards administering public instrumentalities: “.
I have to-dayreceived an urgent telegram signed by the Lord Mayor of Hobart and the mayor of Launceston to the following effect : -
Civic conference Hobart Launceston yesterday carried following resolution: - That as city and municipal councils are agents of the Government in respect of matters connected with local government delegated to them by Parliament, find the State government is exempt from the payment of sales tax, the Federal Government be requested to extend a similar exemption to such councils. Strongly urge favorable consideration.
I trust that the Treasurer will accede to the entirely reasonable request of the conference. Our local governing bodies are doing valuable work for the whole community, and should not be called upon to pay sales tax. State instrumentalities are exempt from sales tax, and logically, local governing bodies should also be exempt from it. The lifting of this burden from the local governing bodies would make it possible for them to provide a good deal more employment, for the money now spent in sales tax could then be devoted to other purposes. As the people who reside in our big cities have suffered very greatly during the depression they should be given some consideration in this matter. Many property owners in various municipalities have been unable to pay their rates, and this has seriously reduced the revenue of the local governing bodies and curtailed their ability to provide employment. If the Government will accept my amendment the relief given to more than 1,000 municipalities and councils throughout Australia will be much appreciated.
– The submissions of both the Deputy Leader of the Opposition (Mr. Forde) and the honorable member for Denison (Mr. Mahoney) are so similar that they admit of the same reasoning in reply. Almost continuously since the inception of the sales tax representations have been made by local governing bodies of various descriptions for either partial or complete immunity from it. In most cases complete relief has been sought. The authorities involved include municipal and shire councils to the number of about 1,000; the Melbourne and Metropolitan Board of Works and other bodies in charge of water works in Victoria, to the number of more than 100; the Metropolitan Water, Sewerage and Drainage Board of Sydney and similar bodies in New South Wales and the other States ; the various harbours boards and tramways boards and trusts, and like organizations; also fire brigade boards. Serious consideration has been given by the Government to the possibility of granting exemption from sales tax to all these instrumentalities; but I regret to say that so far this has not been found to be possible. The granting of such a comprehensive exemption as is desired, would involve a heavier decrease of revenue than the Government is able to incur. To accede to the request of either the Deputy Leader of the Opposition or the honorable member for Denison would logically imply the grantingof similar exemption to all local governing bodies. I can promise, however, that the position will be very carefully watched and from time to time the Government will grant such relief as it is able to afford.
– As exemption from sales tax has been granted to State instrumentalities it. seems unfair to discriminate against local governing bodies by denying them like relief. If State instrumentalities are entitled to exemption so also are local governing bodies, for their work is very similar to that undertaken by many State governments. These local governing bodies obtain their revenue in almost the same way as the State, although different terms may be applied to the revenue and a slightly different procedure followed in collecting it. Many municipalities throughout Australia have experienced great difficulties during the depression and have not yet recovered their normal position. This is due to the fact that so many property owners have been unable to pay their rates. The resultant loss of revenue has made it impossible for many municipalities to maintain their social services at a proper standard. No one can overestimate the importance of the social ser vices providedby our local governing bodies. Sanitation, for instance, is of vital concern to the health of the hundreds of thousands of people who live in city and suburban areas throughout the Commonwealth. It might even be said that no social service performed for the community is of greater importance than that undertaken by local governing bodies. If anything should impair the effectiveness of the sanitary service of a big city or its suburbs the health of every citizen would at once be endangered. Various Ministers have said at different times that the Government is anxious to lighten the burden of taxation on the people generally. I suggest that great relief could be given by granting local governing bodies exemption from sales tax. If that were done, the services rendered by these bodies could be performed more efficiently, for more money would be available for the purpose. Every member who has had personal contact with aldermen and councillors knows that the gentlemen who fill these positions do invaluable work for the general community without fee or reward, and often incur considerable odium in discharging their duty courageously and fearlessly. The Government should therefore, in the interests of the whole community, do everything possible to make their work easier and more effective.
.- I realize that the Treasurer (Mr. Casey), when moving the second reading of this bill, stated that he did not propose to give consideration to any amendments moved in committee, because of the anomalies that it has been found arise, as a result of decisions which the committee may make, and which have not received proper examination by the department. Nevertheless, I submit that this objection is not applicable in this instance. The honorable member for Denison (Mr. Mahoney) desires to exempt from sales tax, the equipment required by public instrumentalities for the carrying out of their ordinary services to the community. If there is one form of taxation more than another that is grudgingly paid by the people, it is the proportion of the rates which they pay to public trusts, boards or municipalities for services, that becomes a source of revenue to the Commonwealth Government. The effect of this is to compel those instrumentalities to raise more loan funds than otherwise would be required, and. their capital expenditure is increased because of the necessity, not only to pay for the materials which they need for essential public services, but also to meet the taxation levied on these materials. To me it appears ridiculous that this Government should be deriving revenue from the moneys expended by local governing bodies and raised from loans subscribed in the ordinary way and constituting a permanent charge on their administration. For one government to tax the revenue of another government is a vicious principle which is now recognized by the Commonwealth, and State governments are accordingly exempted from sales tax. But is it not conceivable that the corporation of the City of Melbourne is iti many respects as essential to the control of Victorian affairs as the State Government itself? The corporation, for one thing, carries out the maintenance of health services. In some places, the provision of water supplies is undertaken by public trusts. I consider that the amendment which the honorable member for Denison has moved is one which the Treasurer might appropriately accept without contradicting the statement he made when moving the second reading of the bill. I know of countless instances where local government bodies, when purchasing equipment, have to pay sales tax, and that charge is most burdensome to the ratepayers. As the result of this imposition, they have to pay more than necessary for their communal requirements and consequently the operations of the municipality are restricted. The Commonwealth certainly gets some revenue out of it, but having regard to the general budgetary position, the Treasurer could afford to forego it. In principle, I consider that the Commonwealth ought not to collect it, because it is, in fact, a double tax on the community. The ratepayers are taxed for the capital outlay of their municipality in providing the essential services, and portion of that imposition goes to the Commonwealth Government. The only reasonable taxation which the Commonwealth should impose on citizens is on their individual lives. It is not right. to tax them as members of a municipality. It does not tax them in their organic relationship to the State, and it ought not to do it in respect of a statutory board established because the State delegates to it certain business which otherwise it would have to carry out for itself. As the State is immune from sales tax, it appears to me that any authority created by the State as its agency should likewise be immune. The principle is inescapable.
– If the remarks of the members of the Opposition were carried to their logical conclusion, of course all taxes are iniquitous. No person likes to bear taxation, but. the obligations of the Commonwealth Government have to be shouldered and taxes have to be raised to meet them. [ could advance as good a plea, I. think, as the next man for the reduction of taxation in many directions. In this instance the Government is asked, in effect, to relieve local governing bodies of all descriptions from the obligations to pay sales tax. I have received many deputations from local governing bodies in this connexion, and I have frequently asked them to inform me of the reduction that they would be able to make in their rates if they were entirely relieved of sales tax. In no instance have I received a reply.
– Did the Treasurer put that question to the Hobart Council?
– No. But I ask it through the honorable member now. I suggest that the reason why I have had no reply to my many requests is that each municipality finds that the sales tax absorbs a microscopic portion of its rates. As I have issued this open invitation on so many occasions without result, my suspicious mind cannot escape that conclusion. If the figures could be seen with the naked eye, I am confident that I would have had them brought under my notice.
– I shall obtain the figures.
– All materials required by local governing bodies for road-making, including cement, sand, gravel and bitumen, Bie exempt from sales tax, and when this bill becomes law, pipes of all descriptions for water supply and sewerage purposes, and a very wide range of building materials will also be exempt. I think it will bo found that if local governing bodies were asked to supply a list of the materials on which they now pay tax-
– Would the deputations have ‘waited on the Treasurer from time to time if they did not have a case to put up?
– I repeat my invitation to the local governing bodies, through the honorable member, to supply me with the information. Further, I would point out that in respect of local governing bodies, the Government announces in the budget its proposal to subsidize interest and sinking funds on their public works to the amount of £100,000. That is no mean amount. The total amount that the departmental officers calculate that a complete exemption from sales tax would mean, is about £100,000 a year, distributed over a large number of local governing bodies.
– There i3 nothing microscopic about £100,000 a year.
– But there are possibly 2,000 such bodies, some large, others small. The Government has framed this plan, to subsidize interest and sinking fund. so that it will come into operation this year, and it is not a charge on the budget for one year, but will probably romain for many years to come. Therefore, anything that the Treasury may fortuitously collect in sales tax from local governing bodies, on the average, will be amply repaid to them under the proposals of the ‘Government.
– I listened with interest to the remarks of the Treasurer (Mr. Casey), and I must confess that I am not at all impressed with the view that he has expressed. If the amount of sales tax involved is microscopic, then the sum involved an the Commonwealth grant to municipal bodies must also be minute. The principle cuts both ways. I contend that the requests from the municipal conference at Launceston are soundly based, and are not to be lightly ignored. While it may be a matter of expediency for the Government to continue to collect sales tax, I suggest that there are other considerations that must be taken into account, and accordingly I support the amendment. In regard to the Treasurer’s challenge to local governing bodies, I shall make inquiries, because this raises an interesting position. Even if, as the Treasurer says, the payments of sales tax by the local governing bodies are microscopically small and the proposed exemption would not result in a reduction of rates, it would, nevertheless, give them a great opportunity to employ more labour, and that is an important consideration for municipal councils. All the time they are faced with the problem of finding employment for those who are unfortunately out of work in their districts. I support the request made for the removal of this imposition.
.- The real objection to this provision i3 that it. is taxation levied by a major authority, th* Federal Government, upon a minor taxing authority, such as a local governing body. .The Government has recognized that there is an objection to that principle, and has granted an exemption to the several State governments. There is no doubt that, if that principle were carried to its logical conclusion the same exemption would be extended to all bodies which impose taxes on the public. But in connexion with the sales tax it is impossible to be logical when any exemptions are being made. Exery exemption granted creates a new anomaly. If we were to act quite impartially to all sections, there would be no exemptions, but a uniform sales tax, with every person paying it, as obtains in some other countries. We have made some departure from the rule by granting many exemptions, but generally the attempt has been made to follow the principle that exemptions should be made when hardship occurs. A new set of exemptions is brought forward every year, and there is competition to decide what claimants are most deserving of consideration on the score of hardship. Applying that principle, municipalities cannot very well be placed at the head of the list. Admittedly their revenues have ‘been depleted, but not nearly to the extent of the revenues of the land owners. Much as we should like to support the requests of municipalities in our electorates, we must recognize that others have stronger claims; and as the number of exemptions is limited, these bodies must await a more favorable season.
Mr. HOLLOWAY (Melbourne Ports) [5.j.J. - The .argument adduced by the honorable member for Perth (Mr. Nairn) may apply in some districts, but it certainly does not in others. The municipalities that have experienced the greatest difficulty throughout the depression are those that have had to enlarge their works programmes substantially in order to provide relief for unemployment. Three poor municipalities in my electorate are Williamstown, Port Melbourne, and South Melbourne. During the last five years, these have kept in employment an army of breadwinners whom they would not. employ in good times. Had they not done so the shopkeepers and ‘business people generally of the district would have become insolvent. It is paradoxical that i he Commonwealth should tax these bodies on money loaned to them through the governments of the States for the relief of unemployment. It is wrong to impose a tax on materials used by municipalities upon works which, but for the existence of unemployment, they would not undertake at present. Some rime ago I wrote to the Treasurer requesting the exemption of certain commodities used by the South Melbourne council. Some of those commodities are included in the list that we now have before us, but I am not sure how many remain, and I urge the honorable gentleman to give further relief when the tax is again being reviewed.
.- The Treasurer (Mr. Casey) has shown on other occasions a willingness to consider the views expressed by honorable members on the subject of taxation. I hope that his refusal ro give favorable consideration to the amendment of the honorable member for Denison (Mr. Mahoney) is not his last word. The action of that honorable member was dictated by the receipt of an urgent telegram from the Hobart and Launceston councils. He and the honorable member for Bass (Mr. Barnard), in voicing the views of those councils, have put the case of local authorities generally throughout Australia. It has been rightly said that municipal councils are agents of State governments in respect of matters connected with local government that have been delegated to them legislatively. The work of the State governments frequently approaches very close to that of local governing bodies, aud in some cases there is overlapping. Yet the State governments are exempt from the sales tax, while the local authorities are obliged to pay it. Why should not this concession apply equally? Those who have any knowledge of the financial position of local governing bodies throughout Australia are aware that, generally speaking, they are in an impecunious condition. In country districts thousands of primary producers, because of the steep fall of the prices of the-r products, have been unable to meet their liabilities in regard to municipal rates. The same may be said of a large number of unemployed in the cities. It is wrong of the central government, with a bulging treasury and a surplus at the end of every financial year, to assume the right to impose taxes upon the less fortunate local governing bodies which are doing the domestic work of the nation, and employing many thousands of persons upon relief works. I know it is said that this is not a big tax. That being so, the concession asked for is not substantial from the point of view of the Commonwealth, although it may mean much to impecunious local authorities who find it difficult to meet their administrative costs. Some local authorities have hardly sufficient surplus revenue to pay the salaries of clerks, engineers and foremen. Quite a number of these bodies throughout Australia have assumed important responsibilities in the carrying out of water supply, sewerage and electric light schemes, which give employment to thousands of persons. We should lighten rather than increase their burdens. The Treasurer has claimed that he cannot accede to the request which has been made, because the obligations of the Federal Government ‘have to be met. Its revenues would not suffer greatly. In the last financial year it exacted, by means of the sales tax, £8,500,000. This year it expects to receive an additional £300,000, and that will be £400,000 greater than the receipts in 1932-33. This small concession could therefore be made without imperilling budget equilibrium. Honorable members should support the very good case which has been made out by the honorable members for Denison and Bass. [Quorum formed.]
.- The Treasurer has asked me to supply information in relation to the extent to which rates could be reduced if the concession which I seek were granted. I undertake to obtain it within a week if he will postpone the consideration of the matter for that period. This grievance of local governing bodies is of long standing. The Hobart municipality has carried out a lot of work for the relief of unemployment, and has been greatly inconvenienced by the high rate of interest. We are not for the moment concerned with interest rates, but any concession, even in regard to sales tax, would be of great help. On the Treasurer’s own admission, , the amount involved would not average more than about £50 for each municipality throughout the Commonwealth.
– My estimate was a very rough one. I said that probably £100,000 would be involved.
– The Treasurer is’ well aware that city ratepayers have been very severely hit by the depression. Many of them have been unable to get their rents, but they have had to pay their rates just the same. This amendment should be viewed with favour by many Government supporters.
– This amendment covers items about which I have made representations to the Treasurer (Mr. Casey), but I think that most municipalities will be satisfied with the exemptions which the Government has itself proposed. Many municipalities are contemplating sewerage works, and they will be considerably assisted by the exemptions which the Government is making.
Question - That the words proposed to be added be so added (Mr. Mahoney’s amendment) - put. The committee divided. (Temporary Chairman - Mr. Martens.)
Majority . . . . 10
Question so resolved in the negative.
Amendment negatived. (ai) by inserting in the itemcommencing with the words “‘Machinery and equipment and materials “, after the word “ equipment “, the words “(and parts therefor)”;
– I move -
That the item be amended by inserting the following paragraph : - “(aid) by adding at the end of the item commencing with the words ‘ Machinery and parts thereof for use in the mining industry ‘ the words ‘ and equipment such as picks, shovels, drills, pit boots, clothing, and other necessary equipment purchased by mineworkers in the coal, shale and metalliferous mining industries’;”:
When the sales tax legislation was last before Parliament, I asked that these items be exempted. Generally my request was granted in so far as it applied to mineowners. A considerable number of what are known as offhand labourers or shiftmen are employed in the mines, and for these the owners buy tools such as those mentioned in my amendment, hut they are not specified in the act. When the tools are purchased by the owners, no sales tax is demanded, but miners who work on contract - and about 80 per cent. of the coal-miners are employed in. this way - have to buy their tools from the local storekeepers and pay sales tax on them. In the rural industries, sales tax has been remitted on every conceivable item of machinery that may be required, and even on the covers for such machinery. I do not object to that, but I maintain that we should be impartial and should extend a similar exemption to tools of trade purchased by workers in other industries. Besides coal-miners working
On contract who must buy their own tools, others in the same position are tributers working in metalliferous mines such as those at Broken Hill and elsewhere. No doubt, the Treasurer (Mr. Casey) will say that the tools of trade are already exempt from tax, but 1 maintain that, in fact, it is not so. I wish the items to be specified in the schedule, so that the miners will know that when they buy tools from the storekeeper they will not have to pay sales tax on them. Mining work causes particularly hard wear on boots. These are soon destroyed by the highly-mineralized water through which miners frequently have to walk. Gum-hoots and other kinds of footwear are usually left at the mines, and should be regarded as tools of trade. The coarse moleskin and dungaree trousers worn by miners fall within the same category. If it is considered desirable to exempt covers for traction engines and rugs used on horses, pigs, and cows, the boots and clothing of miners should also be free of tax. I am asking for consideration for a section of the community that has been seriously affected by the slump in the mining industry. The 5 .per cent, tax on shovels, picks, and’ drills imposes a heavy burden on miners. As the result of representations previously made the impost has already been removed from explosives used by miners, and, to be logical, we should exempt their tools of trade, seeing that sales of tools used in the rural industries are not taxed.
– The honorable member for Hunter (Mr. James) suggests exemption from the tax of miners’ boots and clothing and tools of trade. He has forecast some of the remarks I am about to make, but not the most important of them. He was quite right in saying thai the tools mentioned by him are already exempt from the tax, if bought for mining purposes. Of course, when coalmining and other companies buy tools for mining purposes they are free of tax. The companies can then issue or sell them to their employees free of tax. If a local storekeeper sells these tools for mining purposes, and the purchaser signs a slip of paper indicating that they are bought for those purposes, he should be able to obtain them at prices which do not include the tax. If the storekeeper has already paid sales tax on them to the wholesaler, he can have it refunded by the wholesaler.
– Would that apply to boots?
– No; I am speaking a; the moment of tools of trade only. As far as the Government has been able to make provision for this relief it has done so completely. Nothing more could be done in that direction, unless we exempted all such tools for all purposes. As the honorable member has asked to be supplied with a list of the miners’, tools to which the exemption applies, I shall convey that information to him by letter, and he can give it full publicity. Similar details will be furnished to any other honorable member who makes a written application for them. The experience of the department and the Government, is that it is not practicable to exempt from the tax goods in general use by the whole community. Where an exemption has been granted in respect of an article used for a certain purpose, it has soon been found impossible to police it, and, in order to make the administration effective, it has been found necessary to remove the limitation and to make the exemption of that article good for all purposes. That is why boots and clothing used for specific purposes cannot be exempted. The amount of tax paid by individuals for these goods must be very small, as is also the amount of tax paid by any man who is in receipt of about’ the basic wage. So I suggest to the honorable member for Hunter that most of the articles referred to by him are already free from the tax.
– Why not specify in the act the mining requisites that are exempt, so that those concerned can read the list for themselves?
– The act is purposely framed in general terms, and therefore it operates more liberally than it would if specific items were mentioned. As regards clothing and boots, a limited exemption would not be workable. In some districts miners’ boots have copper nails, and in other localities rag or rubber soles are worn. The Government is apposed to any extension of the practice of exempting articles required for specific purposes, because inevitably the department would soon be forced to make the exemptions apply to the whole range of those goods, and this would entail a great loss of revenue. I hope that the honorable member will’ not press the amendment.
.- ft was stated by the Treasurer (Mr. Casey) that a miner, on purchasing a shovel from a storekeeper, could avoid the payment of sales tax by signing a declaration that the article was to be used for mining purposes. Is that concession available to the large number of prospectors who are to be found throughout Western Australia, and who have to live for years merely on “ grub-stakes “ ? A shovel which could formerly be purchased for 3s. fid. or 4s. now costs up to 7s. 6d. or Ss., and the amount of sales tax involved, though apparently small, is n serious matter to the struggling prospector. I presume that tools purchased by these men would be exempt from the tax.
– I have no desire to whittle away the revenue required by the Government, but I wish to know whether the axes used by timber getters carry the tax. Thousands of men are employed in the timber districts of Western Australia, and if the axes and adzes used by them are not already on the exempt list they should be brought within the same category as shovels. As the Treasurer knows, no doubt, metalliferous miners wear helmets for protection in the event of a fall of stone. This headgear, which is similar to that worn by the Victorian police, was first used at Mount Tsa. The use of miners’ helmets is an American idea and is adopted largely at Wiluna and in some instances on the Golden Mile. These helmets are of immense service in the protection of mcn from the danger of falls of earth or coal. The minors have to purchase the hats and they are of a class which, obviously, cannot be worn outside of the mine. In these circumstances, the Treasurer might consider it worth while inquiring into the amount of tax collected in respect of these goods in order to ascertain if it is worth while continuing to exact it.
.- The Treasurer (Mr. Casey) has stated that the mining equipment which the mine-owners buy in bulk for re-sale to the miner, such as shovels, picks, &c, are exempt from sales tax, and that if the miner buys his pick or shovel from a storekeeper and signs a docket, the storekeeper can claim exemption from sales tax on the article.
– If the storekeeper cares to he may secure a refund of the tax; but in many cases it is not worth his while to do so.
– In that case it lies with the storekeeper as to whether or not the miner gets the exemption.
– The storekeeper can buy from the wholesaler goods for mining purposes free of tax; but if he buys for general stock for all purposes, he has to pay the tax. When he sells to an individual miner goods for mining purposes out of general stock, he can, if he cares to do so, get a rebate for the amount of tax paid, to the wholesaler.
– It should not be left to the storekeeper to please himself whether or not he applies for a rebate of the tax. In any case, however, if exemption can be granted in respect of tools of trade, it should just as easily be made to apply to helmets, boots, and, if necessary, clothing for use in the mines. The miner could sign a docket for one thing as for another. Miners are now experimenting with various kinds of helmets to protect them, from falls of earth or coal, and as compensation has to be paid for injuries received from such falls, naturally the management will endeavour to obtain the. most suitable kind of helmet, and .it is quite possible thatlater their use may be made compulsory. Are these helmets to be classed as hats? I do not think the Treasurer would suggest that men would, use them for other than work in the mine. I cannot visualize any miner going down the street wear-
Lng one of those helmets. Surely, therefore, they cannot be classed as an article of clothing. The same remarks apply to boots and other specialized clothing used only in the mines. At the present lime, bathing facilities are provided at the mines and the miners change their clothes on commencing and finishing work, discarding their working clothes at the mine. To all intents and purposes, this clothing is part and parcel of their equipment, as the honorable member for Hunter (Mr. James) has contended. I supported the exemption from sales tax of the requirements of rural industries which were in a precarious condition; but to-day nobody can say that the miners are not in a more precarious condition than those engaged in rural industries. All honorable members should be prepared to support us in asking for these exemptions, which to the Government mean so little, but to the men concerned, mean so much. Has a.ny honorable member any conception of what an impost of 6d., ls. or ls. 6d. on those articles might mean to the miners in the circumstances in which they find themselves to-day? When the mining industry was flourishing, miners were too free with their money to worry about such small amounts; but, to-day, their position is such that they must take care of every penny. There are two widelyaccepted canons - taxation should fall upon the shoulders of those best able to beatit; and man was not created for the State, the State was created for man - for the purpose of making life better for him. There should be no hesitation in granting the exemptions for which we ask, and I hope the Treasurer will accept the amendment as drafted. If he is not able to do so, I hope at least he will give an undertaking that clothing, boots and helmets used in mining operations will be classed as tools of trade, and that exemption of these goods from tax will not be left to the discretion of the storekeeper. If the Treasurer will go as far as that, honorable members on this side will be satisfied.
.- I support the amendment moved by the honorable member for Hunter (Mr. fames). In the very wide field of exemptions already granted to the rural industries, the Government has adopted the principle of giving relief where it is needed. I suggest that it should apply the same principle in connexion with the rnining industry. In the past, the Government seems to have been actuated by a desire to afford relief to primary industries. Honorable members on this side say that the workers in industries whose incomes are small are also entitled to receive some concessions. I am pleased, however, to accept the assurance of the Treasurer (Mr. Casey) that implements used by miners will be free of sales tax.
– They are free at present.
– Yes; but in some cases the miners have to make direct application for a refund of tax. If, however, the Treasurer can give an assurance that other items such as boots and specialized clothing are also covered by the general exemption, honorable members on this side will be quite satisfied. Whether boots are soled with rag soles and whether they contain copper tacks or not should make no difference; miners do not use them for purposes other than in the pursuit of their calling. I do not think it is right to provide that sales tax exemption can be secured only if the implements used by the miners are purchased from the mining companies. The miner should be able to get full benefit of exemption when he buys from the local storekeeper. The Treasurer must recognize the fact that miners prefer to purchase their requirements at the local 3tore rather than from the mine-owners, who might exploit them in the prices charged. I could quite understand the refusal of the Treasurer to include boots in the exemption if they could be used for any purposes other than mining, because, if that were so, a man would only need to send a miner friend along to buy his boots for him, and he would secure an exemption from the payment of the tax. But these boots could be used for mining operations only. The miners are working in one of the most hazardous industries in this country, and the Government should be prepared to accept the amendment.
– Hats, or helmets, used specifically for mining purposes, are manufactured of a hard substance to prevent head injuries resulting from falls of earth.
I am prepared to give an undertaking that hats, specifically made for mining purposes, are included in the list of rnining equipment exempted from the payment of sales tax. ,
– What about miners’ boots ?
– Boots are in an entirely different category. While a miner may need a particular type of hat Or helmet to protect his head from overhanging rock, it can hardly be said that he needs a particular kind of boot to protect his feet. All artisans wear heavy boots when at work, and it would be impossible to differentiate between miners’ boots and tho boots of workers in other industries and callings. There is a radical difference between miners’ helmets and miners’ boots. I shall see that the special helmets, made for and used by miners, are granted exemption.
I am glad to say, in reply to the remarks of the honorable member for Kalgoorlie (Mr. A. Green), that axes are completely free of sales tax.
.- I am not at all satisfied with the reply of the Treasurer (Mr. Casey). The tools of trade to which I directed attention are not specified in the list of exempt goods. I spoke of picks, shovels, drills., and machines. By machines I meant handboring machines. The machines driven hy electrical or compressed air power are provided oy the mine-owners, and are exempt; but the hand machines that I have in mind are provided by the miners themselves, and are not exempt. It is not fair that power machines should be exempt, while the hand machines should be taxed. The Treasurer has said, in effect, that if the miners request exemption for these tools, ‘.the shopkeeper can apply for it, and it will te granted.; but probably the outlay in stamps and other expenses to get the exemption would be as much as the tax itself. At any rate, . considerable trouble ‘would be experienced in obtaining the exemption. I protest against the unfairness of exempting a hoe used by a farmer, when a shovel used by a miner, and costing three times as much as a hoe, is not exempt. The Government has shown clearly that it is prepared to exempt the tools of trade bought by individual farmers, but not those bought by individual miners, although both miners and farmers are primary producers. All the equipment purchased by the mineowners is exempt, but practically nothing purchased by the miners themselves is free of the tax except explosives. About three-quarters of the items in the list of exempt goods tabled with this bill arc used almost exclusively by rural workers.
– Hear, hear!
– The honorable member for Wide Bay (Mr. Corser) is favorable to the exemption of the tools of trade of the farmers, but not those of the miners. Where is his consistency? It is grossly unfair that, while even a cover for a traction engine is exempt, the wearing apparel required by men who delve thousands of feet in the earth is subjected to tax. I can see no difficulty in adequately describing boots for miners, moleskin trousers, and other special articles of attire that miners need. The miners do not wear clothing of this kind in their homes. In most cases they take it to the mine an’d leave it there until it is worn out. That is certainly the case with pit boots and miners’ helmets. Probably the only time a miner’s helmet or a pair of pit boots is seen in the miner’s home is when they are brought new from the shop, and are about to be taken to the mine. Miners need special boots to protect their feet, for quite often the coal seams are so uneven and the ground so treacherous that coal bursts from the sides of the seams without warning, and falls on the workers’ limbs. It is reasonable, therefore, that we should ask for exemption for the special footwear that is needed to protect a miner’s legs and feet. Miners’ boots are made of special mineral leather., and are iron-shod and liberally provided with hob-nails, and I cannot understand why difficulty should be found in describing them with sufficient accuracy -to justify their inclusion in the list of exempt goods. It is deplorable that we have to .plead with the Government to o’btain-any concession whatever for the workers. If the life of the Ministry depended upon the votes of the members ‘who sit in this corner, it would be possible to get what we wanted without trouble. The members of the Country party have only to make a request for an exemption, and it is granted. Blow-fly traps, poison baits, rugs for animals and everything else that they care to mention are granted exemption. But, while nigs for animals can be included in the list, clothing for human beings cannot be included in it. Why should the miner have to appeal to the local storekeeperto apply for exemption from sales tax on the tools of trade and special clothing that he has to buy? The honorable member for Darling (Mr. Clark) has made it very clear that metalliferous miners purchase their tools not from the mine-owners, but from the local storekeeper. That is the case, also, with coal-miners. The Government, when threatened with defeat on the floor of Parliament, agreed to exempt from sales tax explosives used for mining purposes.
– The exemption was granted voluntarily.
– If the Minister for Defence (Mr. Parkhill) will consult Hansard, he will find that a division occurred on that question. The concession was not made voluntarily. I again appeal to the Treasurer to make a specific exemption of miners’ apparel and tools of trade. Such a reasonable request should be granted without hesitation. Men who work underground are entitled to every consideration that we can give them.
Sitting suspended from6.15 to 8 p.m.
Question - That the paragraph proposed to be inserted be so inserted (Mr.. James’s amendment)- put. The committee divided. (Chairman - Mr. Prowse.)
Majority . . 12
Question so resolved in the negative.
Amendment negatived. (ao)by inserting in the item commencing with the word “ Pastry “, after the word “made,” (second occurring), the words “all shortbread products whether or not they arc marketed as biscuits,”.
– I move -
Thatparagraph (ao) be omitted, with a with a view to insert in lieu thereof the following paragraph: - “(ao) by omitting from the item commenc ing with the word ‘ Pastry ‘ the words ‘milk arrowroot biscuits, baby rice biscuits, but not including other biscuits ‘ and inserting in their stead the word ‘biscuits’;”
The purpose of this amendment is to extend the exemptionwhich now applies to various types of biscuits, particularly milk arrowroot and other biscuits for infantile and medicinal requirements,to allkinds of biscuits, so thatno biscuits made in Australia will be subject to sales tax. The manufacturing of biscuits is a most important industry. Production in 1933-34 amounted to 56,000,000 lb., which was valued at £1,809,000. This industry employs quite a number of persons. In the year I have mentioned, there were 3,390, and wages and salaries paid out totalled £418,000. I understand that the remaining classes of biscuits subject to the sales tax, contribute about £100,000 in taxation to the Treasury. The fact that this industry distributes in wages and salaries only four times, as much as it pays in revenue to the Commonwealth Government, appears to me to be an amazing example of the excessive manner in which the product of an industry has to pay taxes to the Government, as compared with the amount that it disburses in wages and salaries. But this industry does more than employ Australian people; it is a substantial purchaser of Australian primary products. As a matter of fact, the materials used in the year under review were valued at £804,000. To the representatives of the primary producers in this chamber, I point out that, of that sum of money, the flour consumed was 19,S62 tons, worth £201,000, and the sugar required was 114,204 cwt., valued at £183,171. In addition, of course, a considerable quantity of Australian milk is used in The manufacture of biscuits. Apart from providing wages, employment and taxation, and being a substantial purchaser of Australian primary products, this industry was also a contributory factor towards the progress in manufacture that Australia has made in recent years. It spends with other secondary industries £123,000 for wrappers, containers and other services. The power, light, and fuel account which it incurred in 1933-34 was £57,000. It was implicit in this act from the commencement, that basic foods would not be taxed unless it was imperative for revenue purposes to do so. Consequently, many basic foods were exempted from sales tax, even in the very difficult year in which the imposition was originated, and I fail to see the distinction between biscuits as a food for the community and other types of food which are at present outside the scope of th? tax. I put this case quite simply to t.h<> committee without any attempt to adorn the tale. As far as possible, it is economically wise to relieve an industry of this type from taxation.
I shall conclude with a reference to the budget statement of the Treasurer (Mr. Casey), in which he alluded to the buoyancy of the finances and calculated that there will be a surplus for this year. The Government is unwise to tell the House repeatedly how satisfactorily the country has turned numerous corners while the argument is flatly contradicted by the maintenance of heavy taxes upon industries which are desirable, not only because they furnish a market for other industries and thus play their part iu the general structure of Australia’s economy, but also because they definitely and directly employ young men and women. Large numbers of females and youths are engaged in the manufacture of biscuits and the industry is not one for the aged. I suggest to the Treasurer thai he relax his ultimatum to the committee that he cannot accept proposed amendments. My proposal is entirely justified, and I hope that he will make an exception in this case.
.- Great difficulties arise when one class of commodity is exempted from the sale.tax, for it brings an appeal from associated interests for a similar concession. I realize that the Treasurer (Mr. Casey) is confronted with the great task of arranging a satisfactory budgetary position, and I consider that he is carrying out his duty with great credit to himself. If he errs, it is on the side of caution, and that is a matter favorably regarded in financial circles. But having studied the sales tax estimates, I suggest tha’ there will be a substantial increase in this year’s return as a result of the improved trade position in Australia, and 1 therefore believe that biscuits could very well be added to the list of exemptions, without any great disadvantage to the budgetary position. The figures that I have before me show that the value of the trade in biscuits generally in Australia is more than £2,500,000 per annum, which is equal to 7s. 6d. a head. Biscuits are consumed in every Australian home, and can, therefore, be regarded as a part of the national diet. A further reason for the granting of exemption from sales tax is that biscuits are subject to the flour tax. The history of the world shows that the taxing of foodstuffs has caused more trouble than most other matters. If the Treasurer would accept the suggestion to exempt biscuits, he would have the support of an overwhelming majority of the people of Australia.
.- The Leader of the Opposition (Mr. Curtin) has moved an amendment for the exemption of biscuits as a whole, and has stated that the loss to the revenue would amount to about £100,000 per annum, lt would possibly be less than i hat- between £80,000 and £100,000. The honorable gentleman has argued that biscuits are a basic food, and in order to substantiate his case has placed the value nf the production upon a wholesale basis, at something less than £2,000,000 a yeAr The honorable member for Watson (Mr. Jennings), presumably on a retail basis, has made the figure higher than that. But whichever is chosen, the average consumption per capita is only a few shillings per annum. That argument, I should think, is not calculated to impress honorable members with the fact that biscuits are a basic item of food. As a matter of fact the view of the Government is that relatively they are a luxury item; otherwise they would figure more largely in the food regimen of the people generally. The honorable gentleman has also said that he cannot see any distinction between -biscuits and other foods that are already exempt under the sales tax legislation. I can see a very great deal of difference. The consumption per capita per annum of other items of food amounts to several pounds. There
H re a number of items, the exemption of which the Government would seriously consider before this. Already, quite u wide range of biscuits which are necessary mainly for children and invalids, are exempt. They include milk arrowroot, baby rice, Allenbury’s diabetic rusks, malted rusks, Caillard’s biscuits, gluten biscuits, malto oven milk, Mellin’s food, and Ovaltine rusks.
– How does the Treasurer classify cakes and pastry, which are exempt?
– They are made by small producers, who are merely on the verge of making a living. Many other considerations also enter into that case. This measure provides for the exemption of shortbread biscuits, which represent a half-way house between the product of pastrycooks and that of the big biscuit manufacturers. The loss of revenue in that connexion is estimated at something like £7,000. On the average, the amount of sales tax is equal to about id. per lb. of biscuits sold. I do not believe that the removal of the tax would’ lead to greater consumption or a reduction of the price, or that the consumption was appreciably lessened when the tax was first imposed a few years ago.
That is the case which the Government makes out for its exclusion of biscuits from the list of exemptions. The matter has been raised many times within the. last three or four years, but the Government has never been able to see its way to grant a complete exemption. It believes that it has gone as far as is possible and necessary. I regret that the amendment cannot be accepted.
.- I support the amendment, even though shortbread biscuits are included in’ the list of exemptions. I cannot understand why they should be free from the tax and ordinary biscuits should be subject to it. They are the highest grade of biscuit on the market. Joyce’s and Arnott’s cheap grade of biscuits are to be found in the home of every worker. The midday meal of many workers consists of biscuits, which they consider provide them with necessary food values without reliance upon meat. The Treasurer (Mr. Casey) claims that biscuits are a luxury. I have never previously heard that contention put forward. What does the honorable gentleman expect that the workers should eat in order to live? Should they follow the advice of a Queen of France, who said that the workers of that country should eat grass? It appears to me that the honorable gentleman has more consideration for animals than for human beings. Woolworth’s, Cole’s, and other cheap stores in Sydney and Melbourne sell packages of biscuits for 3£d., and their daily turnover amounts to many gross. Their clients are not drawn from Pott’s Point and Toorak. It would appear that the Treasurer is determined that there shall be no increase of the £300,000 which he has decided shall be remitted. I am. astonished that some honorable members opposite should adopt the “yes; no” policy of the late Sir George Reid.
The CHAIRMAN (Mr. Prowse).The honorable member must confine himself to the question at issue.
– I favour the wiping out of sales tax on all foodstuffs that, enter the homes of the workers.
– Hear, hear! It is an infamy.
– I agree with the honors We member. Members of the Country party are continually urging that assistance be given to the primary producers. That section of the community has benefited most from the exemptions which have been made, while the workers have received no consideration. The attitude adopted by the Country party is that, unless its claims are met it will remove the Government from office.
.- Last night, during the second-reading debate, I clearly stated where I stand in this matter. I intend to vote for the amendment, which I consider is a step in the right direction. The biscuit industry has been penalized by having to bear the flour tax as well as the sales tax; and recently, it received a further setback when, under the latest tariff schedule, the duty on importedbiscuits was reduced. The biscuit industry has suffered a severe shock as a result of these various exactions, and this is a golden opportunity for the Government to reconsider its position with a view to affording the relief which is so much needed. The Treasurer himself has stressed the importance of the industry which is worth nearly £2,000,000 a year to Australia. I do not think it is too much to hope that we should be able to manufacture in Australia all the biscuits we require. At the present time pastry, cakes and buns are exempt from sales tax, so why should we not extend the exemption to biscuits? Big firms like Sargent’s and Adams, which manufacture cakes, have not to pay sales tax, and the manufacturers of biscuits should not be placed in a worse position.
– I intend to vote for the amendment. Some honorable members have asked why it is proposed to keep the tax upon certain classes of biscuits, when it has been already remitted upon the more expensive kinds. The only reason, of course, is that the cheaper biscuits are used in the greatest quantity, and therefore provide more revenue by way of sales tax. Everything the workers use must be taxed because those are the things which, by their very quantity, yield the most revenue. As I have said, sales tax has been removed from the more expensive lines ofbiscuits, such as are suitable for infants and invalids, but such biscuits are not used only as invalid food ; they are a luxury food as well. If it is right that a luxury food should be free of taxation, there can be no just argument for continuing to taxthe cheaper kinds of biscuits used by the workers, especially as the Government can well afford to make the remission.
Another argument in favour of the granting of this exemption is that biscuit manufacturing is an important Australian industry which uses Australian raw materials. The Treasurer (Mr. Casey) said that an extra1/2d. per lb. on the price of biscuits would be neither here nor there, but I point out to him that this halfpenny may turn the balance in favour of imported biscuits on which the duty was recently reduced. Australian biscuit manufacturers have improved their factories by the installation of the most modern machinery and the Government rewards them by. removing the tariff protection which they formerly enjoyed.
– Sales tax is collected on imported biscuits as well as on those locally manufactured.
– In my electorate there is a biscuit factory run by Swallow and Ariell in which hundreds of young men and women are employed. They reside in the district, and it would be a serious thing if anything were done to injure the industry, and thus jeopardize their employment. I remind the Treasurer also that there are thousands of children who must be given biscuits as a. food, and when the parentsare unable to afford the best biscuits, the cheaper kind, which are covered by this amendment, are used instead.
.- I intend to support the amendment. Biscuits are used in practically every home to-day, particularly the cheaper lines. The honorable member for Melbourne Ports (Mr. Holloway) was right when he said that the Government insists on taxing the cheaper varieties of biscuit, because they, being most in demand, yield most revenue. I submit that the finances of the country are such now that the Go- vernment can afford to forego this revenue. Every year for the last few years the Government has collected more revenue than it expected, and I have no doubt that the next budget will disclose that the same thing has happened again. There is a biscuit factory in my electorate, and I know that considerable loss has been occasioned by the sales tax on biscuits and on flour. I ask the Treasurer to reconsider his attitude, and, if possible, to accept the amendment.
.- I support the amendment moved by the Leader of the Opposition (Mr. Curtin). I was pleased to hear honorable members from other parts of the Commonwealth eulogizing the biscuit factories in their electorates, and I was able te listen to them with equanimity, knowing all the time that the best biscuit factory of all is in the Reid electorate. I refer to Arnott’s biscuit factory. Not long ago some of the directors of this firm interviewed members of the Federal Parliament asking for a remission of sales tax on biscuits, and their request was supported by the employees of the firm. The directors informed me that they were assured of the support of the honorable member for Watson (Mr. Jennings), the honorable member for Martin (Mr. McCall), and T understood them to say, of yourself, Mr. Prowse. The honorable member for Boothby (Mr. Price) had also given his promise, and I am pleased to observe that he proposes to keep it. Perhaps if the Treasurer (Mr. Casey) sees that there is a prospect of sufficient support for this amendment, he may give way. The directors of Arnott’s also informed me that the Government taxed biscuits and not cakes because, there being only a few biscuit factories, it was much easier to collect the tax from them than from the thousands of small cake manufacturers scattered throughout the country. I was assured that if the tax were removed the poorer classes would be able to buy biscuits in greater quantity, and the factory would be able to provide more employment. In Arnott’s factory there are between 700 and 800 employees. If the number, could be increased to 1,000 by the exemption of biscuits from this tax it would be sufficient to justify accep tance of the amendment, and I feel confident that all honorable members who have biscuit factories in their electorates will support it.
– As the discussion proceeds, honorable members generally must realize that serious discrimination has been shown in the application of this tax. We naturally desire to know what methods of approach have been adopted to induce the Government to grant remissions. It seems to be the desire of the Government that as little public attention as .possible should be focussed upon this objectionable impost. I notice that among the goods to be exempted under the bill are poison carts, bait-layers, fly-traps, rugs for sheep and cows, branding tools, ethyl fluids and so on; but, when exemptions are asked for in the case of important items of food, such as are purchased iu large quantities by the people on the lowest, rungs of the social ladder, our requests are met with a blank refusal and we are told that the amount of tax collected from in- dividual taxpayers in respect of these items is a mere bagatelle. If such is the case then we can go on imposing tax after tax so long as the amount in each case is small, forgetting all the time the great hardship imposed by the total. My atten- tion has been directed to the fact that lorgnettes are included in the exempt list. Perhaps this affords an answer to the question raised by the honorable member for Cook (Mr. Garden), who referred to the tendency displayed by the Treasurer to regard biscuits as a luxury. Some time ago the honorable gentleman was absent from Australia for a number of years, and, no doubt, he then moved in a circle in which lorgnettes are in common use, and, consequently, has lost his sense of values in dealing with luxuries. Perhaps as time goes on he will appreciate the importance of the standard of living which we are fighting to maintain in Australia. At any rate the Government will find great difficulty in reconciling the exemption of such articles as those I have enumerated, with its policy of imposing sales tax on foodstuffs which are vitally necessary to the poorer sections of the community.
– The section to which the honorable member has referred consume only a few shillings’ worth a year of the food- stuffs which are subject, to this tax. The arguments of the honorable member do not square with common-sense. In order to make a rhetorical speech he is willing to concede a great deal to the factual position. It is interesting to know that every member of the Opposition who has spoken on the subject of biscuits, except the honorable member for West Sydney (Mr. Beasley), happens to have a biscuit factory in his electorate. The biscuit manufacturers comprise a wealthy section of the community, and it gives honorable members on the ministerial side great heart to notice that Labour members are so much in tune with their socalled capitalistic masters that they are willing to play the part allotted to them by trying to have a certain amount of tax taken off the cost of biscuits - an amount which I do not believe that they themselves imagine could be passed on to the consumers. They have obeyed their instructions faithfully and well.
– By whose instructions has the Government decided to exempt poison carts and fly-traps.
– That is in accordance with the general policy of the Governernment to relieve the primary producers - a policy which has often been enunciated in this chamber.
The Government has been asked why it has exempted shortbread at a cost of about £7,000. The reason is a simple one. The products of pastrycooks, are free of sales tax, whilst the products of biscuit manufacturers, with certain exceptions, are subject to the tax. This position has gradually led the pastrycooks to evolve a kind of biscuit in the form of a shortbread cake which is indented, and can be broken up into shortbread biscuits. In order to avoid the anomaly arising from this situation the Government had no option but to exempt shortbread. Honorable members on this side of the chamber can at least congratulate those honorable members opposite who have spoken on this amendment that they will be able to present an extremely good case to the biscuit manufacturers, who, no doubt, will be well pleased with their efforts. We on this side are very glad to observe the rapprochement coming about gradually between capital and labour in this country.
.- If I express astonishment at some of the observations of the Treasurer (Mr. Casey), I imagine that it will be equalled only by the dismay of certain of his supporters. In considering taxes imposed upon the people as consumers, we must not. overlook the inescapable fact that the sales tax is not borne by the wealthy biscuit manufacturers, but is passed on by them to the retailers, who collect the tax through the price which they charge their customers for the biscuits. We all know that sales tax is imposed upon wholesalers as collectors, and it was agreed that they would be entitled, in making out their invoices, to add the tax at whatever percentage it was operating to the amount charged the retailers. The allegation that this is a tax which the Opposition desires to be lifted from the wealthy biscuit manufacturers is groundless, not merely because the facts in this particular instance do not support such a charge, but also because, as the Treasurer well knows, indirect taxes are imposed always with the expectation that those who pay them will indemnify themselves at the expense of the purchasing public. Whether customs duties, primage or sales tax, all indirect taxes are ultimately reflected in the prices finally paid by the consumers. If that is not sound economics, the Government had better get another economist in the Statistician’s Department, for Dr. Wilson has made that declaration.
It has been said that biscuits are a luxury, and that the amount paid by the workers in sales tax on this commodity would be very small. The value of the biscuits consumed in Australia is about £2,000,000 a year, or £40,000 a week. The Treasurer has described as a mere bagatelle the amount of £80,000 a year which would be remitted if the amendment were accepted. That sum represents the value of two weeks’ total production of biscui ts. It would pay the wages of an additional 700 employees, or would enable another 50,000 cwt. of sugar to be used by the biscuit manufacturers.
– How many persons does the industry employ?
– The industry employs 3,390 persons. If that is not a good argument, let me remind the Treasurer that the £80,000which he says is a mere bagatelle, would enable another8,000 tons of sugar to be purchased for use in this industry. When discussing whether a thing is or is not a mere bagatelle, let us have regard to the cost of overhead charges. In this case they actually cost the industry less than the tax levied upon it. Yet the Treasurer has, shall I say, the temerity to describe such a tax as a mere bagatelle.
– I did not (mention the word “ bagatelle “.
– The honorable member used the phrase in this sense: He said that the amount of biscuits which the workers consume is so infinitesimal that the sales tax is a mere bagatelle.
– I said that it would not amount to more than a few pence a week.
– I consider that the honorable member’s meaning could well be expressed by the term “ bagatelle “.
– Biscuits cannot be regarded as a dear commodity. What do they cost?
– About 6d.
– The retail price is1s.
– I am speaking of the value of production as given by the statistician. To that must be added transport to the warehouse and from the warehouse to the grocer’s shop, cost of distribution, and general overhead charges. The wholesale value as recorded by the statistician works out at about 6d. per lb., that is, on the basis of 55,871,000 lb. valued at £1,809,000. Let the Treasurer work the figures out for himself.
– Sales tax works out at about1/4d. perlb.
– It does not quite amount to that. The Treasurer’s accusation that the Labour party is concerned for the wealthy biscuit manufacturersis absurd. Honorable members on this side are concerned with the consumers. It is perfectly true that there is a biscuit factory in the Fremantle electorate; I make no apologies for it; it is a most useful industry, and it sells biscuits in other
States as well as in Western Australia. I assure, the honorable member that no representations of any sort have been made to me by any biscuit manufacturer in Western Australia regarding the sales tax. I am not seeking to have the tax removed in the interests of biscuit manufacturers only. I am concerned also in the interests of the employees and of a number of other persons who would be employed if the biscuit industry could be developed and expanded, through increased consumption of its products. When I deal with taxation, my primary consideration is with taxpayers who, in this class of taxation, are paying over £8,000,000 to the Commonwealth, and who, we know, would pay more if this bill, providing for various exemptions, had not been brought down. The Treasurer has already indicated a number of exemptions which he proposes to add to those already in the act. Our complaint is that he proposes to exempt goods in this amending bill which ought not to be exempted unless he is in a position to give up revenue. If he is prepared to yield up revenue previously collected in respect of fly-traps, there appears to be no logical ground for the continuance of the tax on an item such as biscuits. We say that by this bill the Treasurer has made the sales tax more anomalous than ever, in that he has extended exemptions to persons who are consumers of capital goods, such as primary producers, who are able to get the sales tax removed from everything they require. But, when the workers want to buy things, they are first told that the revenue to he given up is too considerable to warrant the matter being given consideration, and when that argument is destroyed, the Treasurer says that this is a legitimate item for taxation, because he regards it as a luxury. If biscuits are a luxury, then indeed the Government’s conception of the standard of living is such that it is hardly worth defending. I am surprised at some of the remarks which the Treasurer has made; I regret their tone, and I a.m astounded by what he regards as the essence of his objections to the amendment.
.- The Treasurer (Mr. Casey) has said that honorable members on this side of the House are concerned with the interests of the proprietors of biscuit factories, and that the defence of the proprietors reflects great credit upon them. The honorable gentleman was obviously only playing to the gallery. Such a statement is not only misleading, but also a travesty of the facts. The honorable gentleman knows full well that the wholesale people do not pay the tax, but that, on the contrary, it is ultimately paidby every worker. The Treasurer is endeavouring to side-track the committee on this occasion, as on others. His policy is to endeavour to camouflage the issue, and to mislead the committee in an attempt to browbeat honorable members sitting behind the Government who are dissatisfied, and who, he is afraid, may vote for the amendment. Honorable members on this side are here to fight far the workers. Biscuits are a commodity which goes into every worker’s homo, and we shall do all we can to see that this impost is removed.
– I rise to support the amendment of the Leader of the Opposition (Mr Curtin). It is time the Government made an effort to remove the sales tax, which was imposed as an emergency measure in years of distress. At any rate, it is time it was removed from articles such as biscuits, which find favour, not only with the workers, but also with people generally. I see no reason why the sales tax should be continued on this delicate morsel. Eventually, the tax is paid by the consumer, and not by the wealthy biscuit manufacturer at all. All these things are passed on to the consumer, and even though it may be difficult to arrive at per cent, of 3d., that difficulty may be overcome simply by removing two or three biscuits from the packet. If a dainty morsel should be regarded as a fit subject for taxation, I can imagine no more dainty morsel than a pig with a rugon, yet the rug is to he exempted. If the biscuit of the poorer classes of the people is to be regarded as a luxury, it cannot surely be regarded as a greater luxury than the rug for the pig, which is to be exempted. Every aspect of this question has been traversed, and I have no desire to delay the committee any longer than to say that I shall record my vote in favour of the amendment.
– It has been generally admitted by the Treasurer (Mr. Casey), and most honorable members, that the sales tax is a form of taxation that should be abolished when conditions permit. We are now dealing with an item that provides a considerable portion of the total sales tax collected, amounting, as it does, to £100,000 a year. Honorable members opposite have from time to time charged members of the Country party with being instrumental in securing the abolition of the tax on certain articles necessary for the primary producers. But in those cases, not a great amount of revenue was involved. Biscuits may be regarded as one item in respect of which we desire to remove the sales tax as soon as possible. Honorable members opposite have referred disparagingly to members of the Country party for their success in securing the abolition of the tax on machinery and the many requirements of the producer, and they have also made reference to fly-traps. Primary producers, I can assure honorable members, have no desire to breed flies, and therefore must trap them. The farmer, obviously, cannot consume all the fruit he grows, and has to sell it to the worker, who receives the basic wage. The farmer himself is very fortunate if he makes even the basic wage. In the operation of his farm, the primary producer has to buy every class of implement and farming machine required for the cultivation of the crops which he grows. The farmer is more entitled to consideration because of the great number of implements that he requires than is the miner who needs only a pair of miner’s boots. A good deal of sympathy has been shown with the workers in this endeavour to get the Government to agree to the addition of biscuits to the list of exempt goods so that the price of biscuits could be reduced by 1/4d. per lb. ; but many commodities other than biscuits should also receive attention - the sweets the children eat, for instance. If this, thatand the other item is added to the list of exemptions, we shall find that the Government will need to impose additional taxation in other directions to make up the revenue lost through limiting the range of goods on which sales tax is payable. -I hope that the day is not distant when the sales tax willbe entirely abolished; but under existing conditions I feel that I must vote against this amendment.
Question - That the paragraph proposed to be omitted (Mr. Curtin’s amendment) stand part of the clause - put. The committee divided. (Chairman - Mr. Prowse.)
Majority . . . . 4
Question so resolved in the affirmative. (ap) by inserting in the item commencing with the word “Peanut”, after the word “ graders “, the words “, and parts therefor,” ;
.- I move -
That the following paragraph be inserted: - ” (apa) by inserting after the item commencing with the word ‘ Peanut ‘ the item - Perambulators; ‘ ; “.
In my second-reading speech on this bill I directed attention to remarks made by the Minister for Health (Mr. Hughes) in various places to the effect that the decline of the birth rate in Australia was extremely dangerous to thewellbeing of the country. A perambulator is a vehicle usedby poor people for the carriage of children, and if such vehicles were exempt from sales tax, one disability would be removed from those who have babies and desire to purchase perambulators. I feel sure that it will be unnecessary to make any special appeal to the Treasurer (Mr. Casey) to get him to agree to this amendment.
– The honorable member for Cook (Mr. Garden) intimated in the course of his second-reading speech of this bill that he proposed to move an amendment of this nature when the bill was at the committee stage, so the Government has had sufficient notice of the amendment to enable it to indicate without delay whether it was prepared to accept the proposal or not. It may be that statistical information is available to show the extent to which the revenue would suffer by the inclusion of perambulators in the list of exempt goods. As such a very strong case hasbeen made for the acceptance of the amendment, the silence of the members of the ministry may be taken as an indication that they acquiese in the views of the honorable member for Cook. The Minister for Health (Mr. Hughes) could hardly oppose the proposal, for he ha? interested himself greatly in the subject of maternal welfare. Not long ago the leaders of the various political parties represented in this Parliament were invited to co-operate to encourage citizens generally to contribute towards the maternal welfare fund established by the Government. A logical corollary to the establishment of that fund is the exemption from sales tax of perambulators. This proposal has been introduced in all seriousness, and we may yet be surprised to find that the Treasurer is prepared to accept it.
– I have not been able to obtain statistics respecting the number of perambulators purchased annually in Australia or of the amount of revenue that would be involvedby the addition of perambulators to the list of goods exempt from sales tax. The Government has already exempted from sales tax invalid chairs and practically everything else designed for the alleviation of human suffering. All milk products, including dehydrated milk, which are largely used for young children, have also been excluded from the ambit of the tax. If perambulators are to be exempted I suggest that, in order tobe logical, the matter should not he allowed to rest there, for there is awide range of other vehicles for children, such as push-carts, go-carts, and bassinettes, which are used for juvenile comfort. I shall obtain statistics, which are not available now, with a view to ascertaining the sum of money involved if perambulators are exempted. But the Government cannot see its way clear to accede to the amendment at what is relatively a moment’s notice. I admit that the honorable member for Cook (Mr. Garden) mentioned perambulators in my ear as he crossed the floor during the division just now, but I did not take it seriously.
– The Treasurer has received correspondence from me during the last three months and has replied to it.
– I regret that I do not remember. Even so, I would not have had an opportunity to obtain the information on the subject this evening. The departmental officers in close touch with these matters every day, not necessarily perambulators, are unable to supply me with any relative statistics at all, nor have they had the opportunity to investigate any anomalies that might conceivably arise from exemption of perambulators.
– How much money would be involved?
– I am not able to supply that information, but I shall take steps to obtain it. I do not think that the Government can be expected to accept an amendment of this nature which may have far-reaching consequences, without investigating all the possibilities. I assure honorable members, however, that the matter will be given earnest consideration when the Government is granting further exemptions.
. - I think, on principle, that perambulators should not he exempted from taxation. Children should not get the idea that they are coming into a care-free life. Every child should be taught to realize as soon as it is able that it is entering a world of taxation and that it will bear the burden for the rest of its days. If coffins are to he exempted from sales tax, it is only because by the time a man is dead he is of no value to the country as a taxpayer.
Amendment negatived. (aak) by inserting in the item commencing with the word “ Traps “, after the word “ Traps “, the words “, and parts therefor,”;.
.- I move -
That the following paragraph be inserted after paragraph [aak) : - “(aaka) by inserting after the item com mencing with the word ‘ Treacle ‘ the item - Tugs which are for the use of. Harbour Boards and Trusts or other quasigovernmental bodies or authorities such as Municipal and Shire Councils, Boards dealing with Water Supply and Sewerage’;”;.
In moving this amendment I am actuated by communications that I have received from harbour boards in Queensland. The Rockhampton Harbour Board recently constructed a tug and on the completion of the vessel the board was called upon to pay sales tax. The object in building the tug was to carry out works in the river, giving employment to men who had previously been on relief work. The Rockhampton Harbour Board is working under considerable difficulties, having an indebtedness of £500,000, and money is being provided by the Queensland Government in order to enable it to continue its operations. It is rightly contended that the imposition of a sales tax upon a semi-governmental body of that kind is quite unjustifiable. The tax affects, not only the Rockhampton Harbour Board, but other harbour boards in Queensland as well. The Brisbane harbour being controlled by the Government,, is exempted from sales tax on tugs of this description, but harbour boards in Townsville, Mackay and Rockhampton, for example, are obliged to pay the tax. It is not fair to discriminate between semi-governmental bodies and the State Government. I hope that the Treasurer will agree to accept this amendment, or give his assurance that the request will receive sympathetic consideration.
Mr. CASEY (Corio- Treasurer)
Opposition (Mr. Forde) to believe that what I said before on the subject of local governing bodies generally, covers his proposal. It would be invidious to make any distinction in favour of this reputable body, the Rockhampton Harbour Board, because I understand that it is the only local governing body of this sort in a position to build its own tugs. If an exemption were granted in this instance it would be definitely and specifically in the interests of one local governing body. I do not think the Deputy Leader of the Opposition would suggest rhat his amendment is really practicable. The board, which is building its own rugs under 1,000 tons, is in a peculiar position, but I will have the matter investigated in order to see if anything can be done in future to extend relief to it. ‘
Amendment negatived. (««/>) by omitting from the item commencing with the words “Water pipes” the words “ thereof, not being parts of a kind that are ordinarily used for any purpose other than as parts of such goods” and inserting in their stead the word “ therefor “.
.- I move -
That the following new paragraph bo inserted : - ” (aapa,) by inserting after the item commencing with the words ‘ Water supplied ‘ the item - “ Wearing apparel of all kinds:’;”. [ do not wish to reiterate the arguments brought forward earlier in this debate; they covered a wide range of subjects, and for the Government it has been a one-sided proposition. Without returning to the now famous item of rugs for pigs, I desire to emphasize that wearing apparel of all kinds should be exempt from sales tax, because it constitutes a big item in the weekly budget of a worker on the basic wage, absorbing up to 22i per cent, of his pay. Persons who are on the lower rungs of the ladder in the community, who are unemployed, or on relief works, should be the first to benefit from any relief. If the Government is genuine in its desire to give concessions under this measure, it should not allow one section of the community exemption from sales tax in the purchase of lorgnettes, an imported luxury from overseas, while the imposition on the clothes of the poor is permitted to remain.
.- I support the amendment, because I consider that sales tax imposed on the clothing of lower-paid people is iniquitous. The Government has exempted many things on which certain sections of the community could well afford to pay tax, but, the wearing apparel of persons engaged on emergency relief work does not escape the imposition. The poor have to endeavour to feed and clothe themselves and their families on a very low scale of wages. These persons are hard hit through no fault of their own. They are anxious and willing to work in permanent jobs, but they are, unfortunately, unable to obtain employment. That their apparel should be subject to sales tax is a tragedy. Many little children are going to school bootless, and charitable organizations have been established in ‘an endeavour to ease their lot by begging for left-off clothing. Some honorable members have attempted to make light of the sales tax, because it. is imposed at the rate of only 5 per cent. Even if it meant the addition of only 6d. or ls. to an article, it would increase the difficulties of those who are engaged in emergency relief work. I cannot see what justification the Government can offer for the exemption of rugs for cows, pigs and sheep. [Quorum formed.] J have mixed with the fanning community at different times, but have never yet. seen a. rug on a pig. I should like the Treasurer to say by whom the request was made for the exemption of that item.
– The exemption relates principally to rugs for stud sheep. 1 believe that a certain number of stud pigs are affected, but they are infinitesimal, and not worth an attempt to make a political point.
– Why should the Government, while refusing to take action that would lower the cost of the wearing apparel of human beings, lend its aid in the provision of comfort and warmth for stock? I plead for the exemption of clothing worn by the children of unemployed and those who are working parttime in the mining and other industries, as well as in emergency relief schemes. It has been necessary to move an amendment, to show that the Government has greater consideration for animals. Many honorable members opposite strongly opposed the sales tax when it was intro.duced during a period of financial stress. They described it as an iniquitous measure, and said that it would inflict a good deal of hardship on working men and women; yet today they will not give relief to that very section of the community. I invite them to visit mining towns in my electorate, where they will see that prosperity is as far away as ever it was. [Quorum formed.]
T support the lifting of the sales tax from wearing apparel generally. One could understand the inclusion of some of the items in the list of exemptions, if the aim of the Government was to serve a party political purpose; but if the Treasurer (Mr. Casey) intended to give relief to the most deserving and the hardestpressed section of the community, wearing apparel should have been the first item considered. A few days ago, in Wollongong, because of the hopelessness of expecting to be able to purchase clothing of practically any kind, relief workers waited as a deputation on the Prime Minister (Mr. Lyons). The right honorable gentleman could find the time to attend convivial social functions, but could spare only five or ten minutes to the deputation. It wished to point out to him the urgent necessity for relief being given through this avenue. Mothers who are handy with the needle have to use calico flour bags and similar materials to make underclothing for their children. [Quorum formed?] Apparently, Government supporters are not interested in this matter. The first necessity after food is the clothing of our people. I cannot understand why this tax on clothing should have been continued for so long. The Government prates about the restoration of prosperity. Honorable members, with tongue in cheek, talk about bringing the nation back to normal conditions. They say that, as the nation approaches the normal state, relief will be given. In the provision of relief, I place the Australian baby before a sucking pig or any other kind, and before a sheep, whether it be a stud sheep or any other kind. While I admit that it is perhaps necessary to help the rural industries, I still say that it is a poor commentary on our civilization, and on our attitude of mind, when we tolerate the lifting of the sales tax from the clothing of animals, while keeping it on the clothing of Australian children. The Minister for Health (Mr. Hughes) nas been broadcasting appeals to the public advocating an increase of the birth-rate, and yet this Government insists upon taxing clothing for children. If the Minister for Health will come with me to some districts on the south coast of New South Wales, I can show him many parents who find it impossible to clothe their children properly. Recently a man was fined for not sending his child to school, and his defence was that he could not afford to buy proper clothes for it. He could furnish the child with some sort of rags sufficient to cover it while running in the bush near home, but he could not clothe it decently to enable it to attend school. The Treasurer may, for all I care, double the tax on da-ess suits, spats, silk hats and silk stockings, if he will take the tax off the clothing of the poor. There is no hope of his doing that, however, because he must do what he is told by the interests which provide the party funds. The Government cannot justify continuing to collect tax on the people’s clothing.
– Who imposed the tax?
– The tax was imposed during a time of grave emergency. This Government boasts that it has restored prosperity. If that be so, then there is no need to continue collecting this tax. Any Government can impose taxes; no statesmanship is required for that. A good government, however, will so adjust the incidence of taxation that it falls upon those best able to bear it. This Government seems to be animated by the philosophy of paganism, and is utterly careless of its duty towards the poor. I urge it to remove the sales tax from clothing of low and medium price. No tax should be imposed on suits of clothes up to £5, or on boots or shoes up to 15s. a pair. On the luxurious clothing in which wealthy persons parade themselves vulgarly and ostentatiously, it may double the tax if it chooses. Other civilizations have been wrecked because governments have tolerated the arrogant display of wealth side by side with the most abject poverty, and this Government should take warning. It is impossible to justify by any sophistry, which seeks to prove that the Good Samaritan was a bad economist, the imposition of this tax upon the clothing o£ the poor when the revenues of. the Government are so buoyant. Let the Government realize that there is much poverty and destitution in the country, and that it is from the poor that it is extracting the pennies with which it is building up its surplus millions. I commend to members of the Government for their consideration the warning published a century ago by the London Times “Let the wealthy beware! The cry may yet go forth ( Destruction of the palaces and security to the people’s bornes.’ “ [Quorum formed.’]
.- I hope that the Minister will reconsider his decision not to accept any amendment designed to remove the sales tax from wearing apparel. Every member of the community is directly affected, and I appeal to the Government to give what relief is possible freely and gladly, and not in the niggardly fashion which has characterized the attitude of the Treasurer (Mr. Casey) in regard to so many of these items. There are 4,000 clothing factories in Australia, employing 72,260 .persons, and paying each year £7,400,000 in wages. It is evident, therefore, that this industry is an important one from the point of view of employment, while its products are distributed from one end of Autralia to another, and are purchased by rich and poor alike. The Commonwealth Statistician has stated that there are 324,000 people out of work in Australia, and probably not fewer than 1,000,000 persons are dependent to-day on some form of charity. When the sales tax was imposed, customs revenue had fallen to £28,400,000, while now it amounts to £37,850,000 ; yet the- sales tax is yielding more revenue than ever before.
The Minister for Health (Mr. Hughes) has been making eloquent appeals to the public emphasizing the need for a higher birth-rate. In a pamphlet which he published recently he stated -
In 1911 the crude birth-rate -was 27.20, in 1933 it was 10.78. To-day it is still less. Making every allowance for the lower deathrate, the decrease in the number of births is startling. At the rate of increase for the quarter of a century preceding 1929 the population of Australia would have been 17,000,000 in 19S4. At the present rate of increase it will bo only 9,000,000!
If the birth-rate continues to drop as it has done since 1929, the population of Australia will bo stagnant in another 20 years.
Unemployment is largely responsible for the declining birth-rate, because the average working man has the greatest difficulty in supporting a wife and children. If we remove the sales tax on clothing, it will go a considerable way towards lightening the working man’s burden. [Quorum formed.]
– I should like the Treasurer (Mr. Casey) to explain the methods adopted by the Government in deciding which goods shall be exempted from the tax, and to inform members of the Opposition how they should proceed in the future in making further representations for exemptions. The Government has defeated all amendments submitted by the Opposition, and we should like to know the principles which have guided it in reaching its decisions. It appears to us that the Government has decided in a haphazard way to grant certain exemptions, particularly in respect of goods used in primary production, whilst it has refused applications for exemptions which would benefit small business .people and workers who have as much difficulty as the men on the land in balancing their budgets.
– I welcome the speech by the honorable member for West Sydney (‘Mr. Beasley). He has shown a sincere desire to obtain information, but I am afraid that this cannot be said of the majority of speakers on the other side who have preceded him. [Quorum formed.’] I must protest to the Leader of the New South Wales Labour party against the irritating tactics adopted by one of his followers in directing attention to the state of the committee when the Minister is attempting to make a serious reply to a courteous question. I was about to furnish figures, to which I referred in my second-reading speech, showing the main classes of goods to which the proposed exemptions from sales tax apply. The most important single exemption is that of containers for exempt goods. This is probably the most troublesome item to the administration, and to a large number of individual taxpayers, but it has not been debated at all in the consideration of this bill. Many taxpayers deal in goods which are exempt, yet they are obliged to keep books and a clerical staff merely because of the sales tax on containers. These containers are required for both imported and Australianmade exempt goods, and the cost of the exemption is estimated at about £40.000 a year. The second important exemption applies to goods used by public hospitals, public benevolent institutions and the like, and it will cost £25,000. The third group of exemptions relates to pipes for drainage, sewerage, irrigation, and water supply purposes, and will involve a further tax remission of £25,000. The exemption of certain articles required for the alleviation of suffering, namely, spectacles and aids to hearing, will cost £15,000, and the exemption of sole leather for boot repairing will involve a loss of revenue of £15,000. The items which I have mentioned account for £120.000 out of the £150,000 which the total exemptions are expected to cost this year.
During last year a number of honorable members wrote to the Taxation Department forwarding representations from their constituents and others for the exemption from tax of certain goods, and giving reasons for the requests. The officers of the department carry on a continuous audit of these applications throughout the year. The requests are *ent to the deputy commissioners, who are asked to forward to the central office particulars of items on which they have found administrative and economic anomalies, and in respect of which they consider that exemption from tax is warranted. In the course of the month or two before the budget i3 presented, the officers of the department reduce the number of exemptions which, in their opinion, are worthy of consideration to a fairly large list, which I go through with the Deputy Commissioner in charge of the sales tax. After full discussion with “him on almost every item of importance, I submit to Cabinet an abbreviated list, together with the full list. Against each item is placed the probable cost of a remission of the tax, and the Cabinet decides on the number of exemptions that will cost the total amount of money that it is able to remit in sales tax for the year. I think that is the only proper system that could be adopted. This investigation entails a great deal of re search in respect of’ every item, before the list goes to the Cabinet. The classes of goods the exemption of which will mean a loss of £120,000 out of the £150,000 that all the exemptions in the bill are expected to cost, occupy, in point of space, about 90 per cent, of the bill before the committee. The effect of the measure will be to reduce considerably the actual number of taxpayers, and this should give much satisfaction throughout the country.
I cannot believe that the amendment with respect to wearing apparel of all kinds has been seriously submitted. Tf this exemption were granted, the cost would be at least £1,500,000, because the total recorded output value of the industry is at least £32,000,000. Therefore, it is impossible for the Government to agree to the amendment.
The honorable member for Watson (Mr. Jennings) referred to certain stanchions and. fittings for concrete water pipes, which I understand are cast in place. I am not certain as to the range of fittings to which he referred, but the component parts of reinforced and nonreinforced supports, stanchions and pipes are free, and the resulting piece, if it is a structure, is certainly free. The honorable member also spoke of photographic goods which were recently the subject of a High. Court appeal. The Government has considered this matter, in conjunction with many other applications for exemption, and, in the circumstances, it is unable to give it priority; but it will be further considered when new exemptions are being dealt with.
Question - That the paragraph proposed to be inserted be so inserted (Mr. Clark’s amendment) - put. The committee divided. (Temporary Chairman - Mr. E. F. Harrison. )
Majority . . 15
Question so resolved in the negative.
Clause agreed to.
Clauses 5 to 9 agreed to.
.- I move - :
That the following new clause be inserted : - 8a. Where theCommissioner finds that freight has been paid on goods purchased for the use of consumers residing in country districts, the Commissioner shall refund the amount of tax found to have been paid in respect of the increased selling price on such goods due to freight charges.
This amendment was foreshadowed in the speech which I made yesterday. I then pointed out the anomaly that city wholesale suppliers who supply goods to country consumers pay sales tax only on the cost of the goods, whereas, if the same goods are sold by country suppliers, sales tax has to be paid, not only on the cost of the goods., but also on the freight incurred in transporting them to the distributing centre in the country. I pointed out that if, say, a Sydney merchant supplies goods at £6 a ton, and the freight to the country is £6 a ton, if the buyer buys in Sydney, the freight is not taxable; but if he buys in the country, the country merchant has to charge sales tax on £12. Members of the Country party will realize that quite a lot of purchases from country wholesale suppliers, such as salt and other commodities, have to bear this unjust impost. It is discrimination in favour of the city supplier. People are encouraged to buy in the cities to the detriment of the country traders, as a result of which 1 he establishment of branch houses in country centres is retarded, and unem ployment in country districts is increased. I received a letter from the Treasurer (Mr. Casey), dated the 29th July, 1936, portion of which I quoted yesterday. I understood the Treasurer, in replying to my speech yesterday, to say that, had he known in time, an amendment could have been brought down to overcome this disability. The first paragraph of the Treasurer’s letter reads as follows: -
My letter toyou of the 8th March, 1935, advised that representations put forward by country wholesale merchants were under consideration with a. view to seeing whether certain competitive disabilities, alleged to be suffered because of the application of sales tax to freight, could be rectified.
Thus, the Treasurer acknowledges that he addressed a. letter to me on this subject as long ago as the 8th March last. A promise was given early this year that an amendment would be brought down to eliminate the payment of tax on freight.
– Who gave that promise?
– The promise was given in the House.
– I made no such promise. The honorable member might check the accuracy of that statement.
– The matter was raised, and the Treasurer’s reply was understood to convey that an amendment was being considered. The Government realizes that an anomaly exists in this connexion, and should be prepared to rectify it. The payment of tax on freight is placing the country traders and country people, generally in a very unfair position. The general practice adopted by country storekeepers is to bring stocks into country warehouses, and to supply goods locally from those warehouses. In my speech yesterday, I pointed out from the time the sales tax was brought into operation in August, 1930, until September,, 1933, the practice of invoicing goods at the actual cost and charging sales tax on the price of the goods only, was permitted by a ruling of the department. But, at the end of 1933, a new ruling was given, as the result of which the department is demanding sales tax on freight in respect of goods sold between August, 1930, and September, 1933. In other words, country traders are being called upon to pay retrospective tax over a period of two and a half years. I commend my amendment to the Government as a reasonable one.
.- Though the Treasurer (Mr. Casey) has clearly indicated the impossibility of accepting any further amendments to exempt other items from sales tax, I suggest that the amendment moved by the honorable member for Darling (Mr. Clark) is a reasonable one, and should be reconsidered. The present practice adopted of charging sales tax on freight results in serious injustice to country storekeepers, many of whom are experiencing great difficulty owing to the bad times through which we have passed. A country storekeeper operating in a locality fairly close to a city is severely handicapped by having to pay sales tax on freight as well as on the cost of the goods, while the city storekeeper pays only on the cost of the goods. Many country storekeepers have directed attention to this anomaly, and I hope that, although the Treasurer cannot grant relief in the near future, he will at least take steps to do so when the budget is under consideration next year.
– I give a complete denial to the off-hand statement of the honorable member for Darling (Mr. Clark) that I promised to introduce an amendment to exempt freight from sales tax.
– The honorable gentleman did give such a promise. A statement to that effect appeared in the Canberra Times.
– It is completely incorrect to say that I made such a promise. The honorable member for Darling left the chamber this afternoon when I was giving a full explanation of the position in regard to the imposition of sales tax on freight, and I cannot at this stage repeat the remarks that I then made.
I regret that I am unable to give the honorable member for Moreton (Mr. Francis) an undertaking that the Government will reconsider this subject, for it has already been very carefully considered. I point out to the honorable member that it is open to dealers, merchants or purchasers in the country to buy goods f.o.r. or f.o.b., in which case freight charges do not appear on the invoice, and so are not liable to sales taxation. It must appeal to the honorable member also that many of the articles which country storekeepers trade in. apart from groceries and certain other foodstuffs, are used by primary producers, and so are already exempt, from sales tax. The problem, therefore, is not of such great proportions as some honorable members have suggested. While it is true that country wholesalers may labour under some degree of disability in consequence of having to pay sales tax on freight-
– That causes discrimination between two sets of storekeepers in the same town.
– Such discrimination is not caused wittingly by the Government, but is consequent upon geographical considerations. There has been no retrospective taxation of firms misled by the original statement of departmental officers on this subject. If the honorable member for Moreton were aware of the results of the great amount of research made by officers of the department into this subject, I think he would agree with me that the number of anomalies and injustices which would be caused by exempting freight from sales tax would be far greater than the number that would be cured by such action.
– Do I understand the Treasurer to say that country wholesalers may huy goods f.o.r. in any of the capital cities, cart the goods 150 miles or so, and only pay sales tax on the city price of the goods?
– I did not say “ wholesalers “.
– Country wholesalers are definitely at a disadvantage in this matter. A wholesaler at, say, Coonamble, who buys a commodity in Sydney at £20 a ton, has to pay £1 freight on it and is charged sales tax on £21 a ton for the goods concerned. City wholesalers, on the other hand, are able to sell similar goods to retailers at £20 a ton.
– But if the purchaser were in the country he would have to pay freight.
– Nothing that the honorable member can say can explain away the disability under which the country wholesaler labours. By imposing sales tax on freight, the Government is really acting in restraint of trade. It is, in any case, bolstering up city monopolies and preventing decentralization which the Country party is alleged to favour. One consequence of this policy is that country wholesalers are being forced out of business, for city wholesalers undersell them. The existing practice favours big city monopolistic concerns to the detriment of country firms, and is therefore unjust. When country wholesalers are able to. operate on an equitable basis, they can provide a valuable aid to primary producers by enabling them to purchase their requirements in half-ton, quarterton or even cwt. lots at wholesale prices; but when they are compelled to charge a much higher price than city wholesalers, the country customers are forced by economic considerations to buy from the city wholesalers. This, in turn, means that they have to enter into arrangements with financial institutions to find the money to pay for larger quantities of goods than they would need to purchase if they could deal with the country wholesalers. What I am saying applies to rock salt and many other commodities that country people buy in fairly large quantities. I cannot understand why difficulty should be encountered in excluding freight from sales tax. When I was in business freight charges were always shown as a separate line on the invoice, and in most cases goods were ^ quoted at a certain price, plus freight. The Government should be glad to do everything possible to facilitate the operations of country wholesalers, because decentralization would be encouraged thereby; but it seems to me that its policy is to act otherwise, notwithstanding that country wholesalers render very useful service to primary producers generally. This is an extraordinary position, and I hope that the honorable members who represent country districts, and who are in favour of decentralization, will remember that this matter is of vital importance to them. Otherwise a lop-sided civilization will develop, and all these enterprises now operating in large country towns will be localized in cities. This tax will operate in the interests of capitalistic concerns in the metropolis which seek to extract from the farmer the last possible shilling. I hope that the Minister will explain the difficulty which prevents sales tax from being collected on an article sold at the Sydney price, without the addition of freight. To me, the matter is simple and plain.
– I cannot support the amendment in its present form, namely, that there should be a rebate or exemption in respect of all freights, because the element of freight, enters into the capital cost of nearly all goods before they reach the point at which the sales tax applies; but there is good ground for the objection taken and for the request for a reconsideration of the anomaly. There is no fairness in the present system whereby sales tax on certain lines of goods is 50 per cent, higher in Broken Hill than in Sydney. Sales tax should be equal throughout the Commonwealth. A basic principle of federation is that there should be no distinctic between the States or parts of States. Geographical situation was not to be a disadvantage, but there is a real distinction in this instance operating harshly against the inland districts. The anomaly is limited to those places where wholesalers in large cities like Broken Hill are carrying on business, and it is not right that the people who buy from them should have to pay increased sales tax. I expect that there are difficulties in the way, but the department, if it sets itself earnestly to tackle the problem, could surely arrive at a system of rebate whereby the country wholesaler could bo placed on equal terms with dealers in the city. No great principle affecting the sales tax itself is involved. The incidence of sales tax was intended to operate at the stage of the true wholesale price. The department, in practice, has made it operate at the last wholesale sale.
– It stops pyramiding.
– The real true wholesale value irrespective of geographical advantage, is the point at which the tax should attach.
– Perhaps the consideration of this matter has not- been taken as seriously as it warrants, and if some of us were in the plight of the people in Coonamble and Broken Hill, for example, we should probably be keener to see what is obviously an injustice removed. The correspondence which has passed between the Treasurer (Mr. Casey) and the honorable member for Darling (Mr. Clark) indicates that the Government, at one stage, did feel sympathetic, and expressed the opinion that something could be done to alleviate the position of country wholesalers. That shows that the Government appreciated the position of those people.
– Certainly. I have not attempted to say otherwise. The point at issue is that any so-called solution that has been propounded would create worse troubles in other directions. If the honorable member has any new proposal to submit, the Government will give it careful consideration.
– My suggestion would probably be met by the argument that it was contrary to the law in some other respects. The correspondence further shows that a practice designed to overcome the anomaly by a system of rebates, was introduced and operated from the 31st August, 1930, to the 30th September, 1933. At the latter date, apparently, the legal advisers of the Taxation Department gave the opinion that the practice was not in. conformity with the law, and so the system was altered. A further injustice occurred when these people, after they had been allowed rebates, or rulings had been given them to the effect that they were to be relieved of this imposition, and they had carried on their businesses with that understanding, were, subsequently, according to advice I have, received, notified by the department that the amounts rebated would have to be paid again as taxation.
– Perhaps the honorable member was not in the House when I previously dealt with that aspect.
– Then am I to understand that the department has not made that demand?
– I shall answer the honorable member’s question when I reply.
– Undoubtedly’ the Government appreciated the fact that an injustice was being clone in this instance. There is always a way of overcoming an injustice if the desire to do so exists. When taxes have been inadvertently collected without the proper authority, measures have been introduced to ratify that illegality. Hence there is always a way out of the difficulty if it is sought. I do not think the Treasurer should allow an anomaly to remain when he and the department realize that a wrong is being clone to the country people. This applies to clothing and to other items that have been discussed to-night. This tax bears upon the consumers who live in those outback districts, and as the result the cost of living is increased. Those who live in the backblocks suffer many inconveniences while carrying out a work of development that is appreciated by ti if rest of the community. On that account, they should receive consideration. If the department makes a ruling and advises the taxpayer accordingly, it is desirable that it should be adhered to. I know of an instance where a tailor in Launceston was fined for not having paid sales tax despite the fact that he had obtained a ruling from the Deputy Commissioner of Taxation, that on the additional charge he had made to cover the tax he was not required to pay tax. It all adds to the irritation caused by this measure, and assists to make it even more unpopular. If rulings are given they should be adhered to, and consideration should be shown to taxpayers by arranging for deputy commissioners to publish a set of rulings as was done in connexion with pensions.
– A book of sales tax rulings has been published.
– If the other aspect to which I have directed attention has been answered, I should like to hear what the Treasurer has to say in connexion with retrospective payments.
.- I should like to reply to the observations of the Treasurer (Mr. Casey) that persons in country districts have received substantial remissions of sales tax on many items which they use. I know that many country storekeepers and country wholesalers have had to pay the sales tax on the freight as well as on the cost of the goods. If there have been substantial exemptions in respect of goods used in the country districts the amountinvolved in this request would not be very great. The objection of the Treasurer to any remissions suggested by the committee is that such remissions would involve the Government in the loss of hundreds of pounds of revenue; but as he has admitted that the volume of goods upon which the tax on freight is charged is not large, a substantial remission would not have to he made. I trust, therefore that this matter will be further considered.
– It is true that in 1930 many taxpayers were informed by the department that if freight and similar charges were shown separately on the invoice, they would not be subject to the sales tax. It was not a matter of making a rebate; they were told that such charges -were not taxable. This eventually proved to be, not only contrary to the law, but also provocative of anomalies, particularly in cases where the sale price included freight. Consequently upon the rush and confusion in the earlier period of sales tax administration - the work was a tremendous tax upon the department in dealing with the complex sales tax legislation - certain errors occurred. When these were discovered a general ruling was made, but I am sure no attempt was made to collect the tax retrospectively from persons who were able to prove that they had acted upon erroneous advice. I did not hear of any complaints at all.
– I heard that numerous firms were requested to include it.
– If representations are forwarded to the Treasurer, will he consider them?
– Certainly. Does the honorable member say that he can prove that some persons acted upon erroneous advice, or does he suggest that they took the law into their own hands?
– It was done with the knowledge of the department.
– I adhere to what I have said. If the honorable member can produce evidence-
– Supposing a wholesaler in a town received the advice officially and passed it on to others?-
– The question is whether he was acting on advice received from the department, or on advice received from another wholesaler. The revenue aspect is of only minor importance; the main difficulty is the creation of other anomalies. Goods transported only a few miles from the place of manufacture or import, incur charges, and if consignments have to be traced back to the point of import or of manufacture to obtain the net cost for sales tax purposes, we would be getting away from sales taxation, and imposing a production tax which is a different form of tax from sales tax. If this tax ‘ is maintained as a sales tax, which is relatively simple, it must be charged on the last wholesale sale. We cannot have a sales tax which in effect is a production tax.
– The Treasurer admits the injustice of it.
– The world is full of injustices, but it is news to me that a large volume of goods is involved. I am informed that a large proportion of the goods sold in country centres are invoiced f.o.r., or f.o.b. Sydney, or whatever the port may be, so that in practice the sales tax is paid largely on the price charged at the capital cities without freight being added. In reply to the honorable member for Moreton (Mr. Francis), I may say that it is not so much a question of revenue, but of principle, and the precedent that would be established. I can imagine the intolerable situation that would arise in the department if it had to check costs back to the point of manufacture or importation. If the principle is accepted at all, it involves throwing overboard this tax as a sales tax, and giving it rebirth in the form of a production tax. If honorable members have any proposals to submit that will be of benefit they will be given consideration.
Question - That the proposed new clause be agreed to (Mr. Clark’s amendment) - put. The Committee divided. (Temporary Chairman - Mr. E. F. Harrison.)
Majority . . 9
Question so resolved in the negative.
Proposed new clause negatived.
.- I move -
That the following new clausebe inserted: - “ 8b. Sub-section 1 of section 20 of the Sales Tax Assessment Act No. 1, 1930-35, is amended by adding to paragraph e thereof the following words’: “and where the business is outside the capital city of a State, in excess of three thousand pounds “.”
This amendment is designed to assist country tailors, who have graduallybeen forced out of business under the existing provision of ?1,000.
– I appreciate the point that the honorable member for Cook (Mr. Garden) is seeking to meet. His proposal, however, could not be accepted in the form suggested, because a specific advantage would be given under it to one class of trader only. Any consideration by the Government would need to embrace all classes of sales taxpayers outside capital cities.
There is a further fundamental objection. The bill relates to exemptions from sales fax, and consequently I suggest that a proposal to amend one of the sales tax actsby way of an enlargement of what might be termed the statutory exemption - that is, the remission of the first ?3,000 of a man’s turnover - would not he in order.
- (Mr. E. F. Harrison). - I am of the opinion that the amendment of the honorable member for Cook (Mr. Garden) is in order, and falls within the scope of the bill.
.-! commend the soundness of your judgment, Mr. Temporary Chairman, and support the amendment. The exemption of the first ?1,000 of a tailor’s turnover is not sufficient, because one-third of that amount would represent material, onethird wages, and the remaining third overhead expenses and profit. I have read the debates and have studied the alterations that have been made in this matter. Originally the act provided for the exemption of all apparel made to special order. The Government felt that advantage might he taken of that by large manufacturers, and introduced an amendment which it thought would exempt small manufacturers and country tailors. The average countrybusiness employed from six to ten employees when the tax was instituted,but at the present time the majority of them have probably only one employee and in many cases the tailor is carrying on unaided. The tendency has been for the trade to gravitate to the cities and this hashad an adverse effect on the policy of decentralization. The proposal of the honorable member for Cook has much to commend it. The exemption of £3,000 would not entail a very big loss of revenue, but would he of considerable assistance to country tailors and would probably enable them to re-establish their businesses.
– T have just been informed that, within the lust fortnight, the Prime Minister (Mr. Lyons) has received telegrams from all the master tailors’ associations of Australia protesting against any exemption from sales tax based on the amount of turnover. They claim that such an exemption creates unfair competition in the trade.
– I have no doubt that the Prime Minister (Mr. Lyons) lias received wires from the gentlemen whom the Treasurer (Mr. Casey) has called “master tailors”, but I ask the Treasurer to inform honorable members as to who are these gentlemen. Under present conditions, tailors in country centres who regularly employed half a dozen hands, and sold a genuine article, are being forced to sack their employees and deal from these so-called tailors. If the names of those who despatched these telegrams to the Prime Minister were disclosed, I have no doubt it would bo revealed that they are men who sell machine-made suits as handmade suits - factory people who are developing undesirable conditions in the tailoring and softgoods trade. Most likely they are akin to those Polish Jews who set up a few machines in badlyconstructed and ill-ventilated buildings in a. back street, and dominated the clothing trade of London in the old days. I have no doubt that the so-called master tailors referred to by the Treasurer are developing conditions in the trade similar to those which existed in Melbourne in the SO’s and 90’s. Genuine tailors in country centres will bc forced, under the present exemption, either to become “ snide “ dealers or to face unemployment. If the Treasurer will read the names of the senders of these telegrams, I suppose that “ Solomon, Isaacs and Moses “ would be found among them - gentlemen of the kind who batten on the industry and. are responsible for the undesirable conditions now prevailing in the trade. I support the proposed, clause moved by the honorable member for Cook (Mr. Garden). If the Government accepts it, it will be doing something to rehabilitate the trade which, at its best, was a credit to country commercial life. Under present conditions, however, tailors in country centres who are struggling to make a liking have to pay sales tax. It is possible that a tailor with a gross turnover of £1,000 will show very little profit on his trading. The amendment is reasonable, and the Government should accept it.
.- I ask the Treasurer (Mr. Casey) to produce the telegrams in order to enable honorable members to discover who have influenced the Government in this matter ?
– Nobody has influenced the Government.
– It is only reasonable that the telegrams should be produced.
.- I had no intention of taking part in this debate until it assumed an extraordinary and almost unprecedented character in so much as the Treasurer (Mr. Casey) who rose, as I thought, to give a serious answer to the representations made by the honorable member for Cook (Mr. Garden), announced to the committee that the Prime Minister (Mr. Lyons) had received a number of telegrams from various people in different parts of Australia protesting against the proposal embodied in the amendment. I point out that it is an established rule of the House, which also applies to the House in committee, that documents to which a Minister invites attention should be produced for the inspection of honorable members. I ask that this well-established rule be observed. Documents referred to. as the Treasurer has referred to these telegrams, become the property of the committee for investigation, first, as to their genuineness, and, secondly, as to their origin or the names of the persons who have taken the responsibility of despatching them to the Government. Who are they? What are the interests involved? Why did the Treasurer collapse so suddenly after having mentioned, the fact that the .Prime Minister had received the telegrams? This is a. serious matter, and I hop:that the point I have raised will receive. fair consideration by the committee. 1 have not previously taken up the time of the committee during the debate on this subject, though I have followed the proceedings carefully, and have recorded my vote against the prosposals of the Government when I thought it necessary. I realize the importance of the issue, and I believe that the sales tax should be progressively reduced until such time as it can be abolished altogether. In the meantime, I ask the Treasurer to produce the telegrams. That is a reasonable request.
-. - ls the honorable member referring to the 1 080 telegrams?
– Now it appears that these telegrams are five years old. How did it happen that the Treasurer was able at a moment’s notice to secure information regarding these telegrams received, not by him, but by the Prime Minister five years ago?
– The 1930 messages to which I referred were cablegrams dealing with another subject; they had nothing to do with tailors at all.
– We are now invited to go back over a lustrum - which I understand is the Latin term for a period of five years - and we are invited to consider a new set of telegrams altogether. I again ask the Treasurer whether he will produce the telegrams. There will be all sorts of speculations in the newspapers to-morrow as to what the messages contain. I hope that the Government will not, as on previous occasions, make available to the press the contents of these documents whiCh have been withheld from tho committee. If the Minister for Trade and Customs has possession ot the documents, and they are subject to censorship, we should be told. I hope that the committee will take note of my protest against the suppression of these documents. If the Treasurer will not produce them, I can do no more than support the amendment of the honorable member for Darling (Mr. Clark). I am sorry to say that the Treasurer has come out of this debate rather- badly.
.- When the Treasurer (Mr. Casey) rose to speak a. little while ago, I expected that he was going to produce the telegrams to which he had referred, instead of which he attempted to fool the committee by rising and immediately sitting down again. He stated that the telegrams contained protests from the master tailors against what they described as the unfair competition which would result if the amendment of the honorable member for Darling (Mr. Clark) were accepted. In reply, I point out that there is always unfair competition in trading matters as between large and small manufacturers of any article.
With the permission of the committee, I should like to wait until the Treasurer, who is in charge of this measure, returns to the chamber.
- (Mr. E. F. Harrison). - There is a Minister at the table.
– I am referring to the Minister who makes it a practice to mislead honorable members by the statements he makes in reply to points raised during debate. On previous occasions honorable members on this side of the House have had occasion to correct him when he has made misleading statements.
– I as”k the honorable member to withdraw that statement.
– Very well, I shall withdraw the whole of my speech and begin again.
The TEMPORARY CHAIRMAN.The honorable member must confine his remarks to the question before the chair.
– Ordinary courtesy demands that the Minister in charge of the bill should be present to reply, if he is able, to the arguments adduced by speakers in support of the amendment. The Treasurer did not attempt to answer the case made out by the honorable member for Darling but relied instead on some alleged protest contained in some imaginary telegrams supposed to have been received by the absent Prime Minister. Honorable members are entitled to bc given a more convincing reply than that. Tailors in the country are at present carrying on at a disadvantage as compared with city firms, and even if they are granted the benefit asked for in this amendment, there will bc no danger that they will make any inroad? into legitimate city trade. Even though the hour .be late, there is no reason why legislation should ‘be rushed through. The Government should give proper consideration to the points raised by honorable members. For my part, even, if the telegrams to which the Treasurer has referred really existed, and were produced, they would not influence my vote. Honorable members are accustomed to receive shoals of telegrams in regard to most matters that come before the House, sent by people who wish them to vote in a particular way. Parliament should deal with the cases on their merits and should not be influenced by any representations made by interested parties ; but it is evident that that course is not to be followed in this instance. The Treasurer refuses to accept the amendment, on the ground that protests have been received from a number of master tailors throughout the Commonwealth. When a previous amendment was before the committee, which was designed to remove the sales tax from biscuits, he said that a good case had been made out for the biscuit manufacturers, and he suggested that those who made representations had been offered some inducement, to do so. The position is now reversed. It may be that the Treasurer and those who support him in this matter have been offered some inducement by the master tailors in the cities to prevent their smaller competitors in country districts from operating successfully. Many of these smaller tailoring concerns have been forced out of business, and have had to close their premises and dispense with their employees because their trade has been taken from them by certain city manufacturers who sweat their employees. Honorable members opposite who profess to believe in decentralization. can show their genuineness by voting to keep a proportion of this trade in country districts. That can only bc done by making it possible for the smaller tailoring concerns in the country to compete with the master tailors of the cities. If the Treasurer is unaware of the amount of revenue involved he can report progress, and ask the officers of the department to secure the necessary information before the committee again meets. During the week end he might also communicate with the absentPrime Minister. with a. view to securing the bundle of telegrams containing protests, so that honorable members may know the persons and organizations which are influencing the Government in its decision. I recollect that, on one occasion, I read in this chamber a protest which had been submitted to me by telegram from a disgusted wheatgrower. He was disgusted at the action of some members of this Parliament in voting large sums of public money to themselves. When I attempted to read that telegram the Chairman said that I would not be in order in reading it unless 1. was prepared to place the telegram on the table, thereby acquainting the Government with the name and address of its sender. I draw attention to Standing Order 317, which reads -
A document relating to public affairs quoted from by a Minister of the Crown, unless stated to be of a confidential nature or such as should more probably be obtained by address, may be called for and made a public document.
– The Treasurer did not quote from any document.
– The honorable member for Batman (Mr. Brennan) was within his rights in asking for the production of the telegrams. The Treasurer will not produce them because the Government is unwilling to indicate the individuals and organizations which are influencing its policy.
– Perhaps the telegrams do not exist.
– If I were to suggest that a Minister was claiming to quote from a document which was non-existent, I should be called to order. However, although we may not always say what we think, there is nothing to prevent us from thinking. 1 shall not be satisfied until the documents are produced. And if they are not produced, I can only assume that the Treasurer’s quotation was incorrect. I am not alone in doubting the existence of the telegrams to which reference has been made. Is the honorable gentleman afraid to disclose the names of the senders because they are persons who contribute largely to the funds of the United Australia party? It may be for the same reason that the Government is not prepared to protect the small tailoring concerns in the country. I commend the honorable members for Cook (Mr. Garden) and Darling (Mr. Clark) for the sterling fight they have put up.
The TEMPORARY CHAIRMAN.The honorable member has exhausted his time.
Motion (by Mr. Gander) - put -
That the honorable member have leave to continue his speech.
The committee divided. (Temporary Chairman - Mr. E. E. Harrison.)
Majority . . 11
Question so resolved in the negative.
Motion (by Mr. Thorby) put -
That the question be now put.
The committee divided. (Chairman - Mr. Prowse.)
Majority . . . . 11
Question so resolved in the affirmative.
Question - That the proposed clause (Mr. Garden’s amendment) be agreed to - put. The committee divided. (Chairman - Mr. Prowse.)
Majority . . . . 9
Question so resolved in the negative.
Proposed new clause negatived.
Title agreed to.
Bill reported without amendment; report adopted.
Bill -by leave - read a third time.
The following papers were presented : -
Air Force Act - Regulations amended - Statutory Rules 1935, No. 98.
Arbitration (Public Service) Act - Determination by the Arbitrator, &c. - No. 18 of 1935 - Australian Workers’ Union; and Amalgamated Postal Workers’ Union of Australia.
Defence Act - Regulations amended - Statutory Rules 1935, No. 99.
The following bills were returned from the Senate without amendment: -
Invalid and Old-age Pensions Appropriation Bill 1935.
Supplementary Appropriation (Works and Buildings) Bill 1933-34.
House adjourned at 12.10 a.m. (Thursday).
The following answers to questions were circulated: -
l asked the Prime Minister, upon notice -
– The answers to the honorable member’s questions are as follows : -
The position remains as stated by me in answer to a question, without notice, on 3rd October, viz., that the Government has not decided upon any such inquiry, and that, at the proper time, its decision will be made known.
s asked the Prime Minis ter, upon notice -
– The answers to the honorable member’s questions are as follows : -
1 28, 333.
2. (a) 247; (b) 1,628; (c) 59; (d) 10; (e) 2.
n asked the Minister for the Interior, upon notice -
– It is proposed to make a full statement on this matter at an early date.
y asked the Treasurer, upon notice -
Will he state the contributions by each State to the last six Commonwealth internal loans, or, alternatively, the percentage contributions by the States?
– The only information available is the amount of subscriptions actually lodged in each State. This information does not indicate the amounts subscribed on account of each State as the subscriptions by large financial institutions trading in the several States, which account for more than half of the loan totals, are almost wholly lodged in New South Wales and Victoria.
n asked the AttorneyGeneral, upon notice -
– The answers to the honorable member’s questions are as follows : -
n asked the AttorneyGeneral, upon notice -
What action, if any, is to be taken during the present session to complete the amendment of the Bankruptcy Act?
– An amending bankruptcy bill is now in course of preparation, and it is intended to refer it in the first instance for consideration by a committee of honorable members.
n asked the Minister representing the Postmaster-General, upon notice -
Will the Government make it a rule in broadcasting that the correct names and addresses of persons addressing listeners-in shall bc announced before and after the address ?
– The suggestion made by the honorable member is extremely important and valuable, and immediate consideration will be given to the question of insisting on the disclosure of the full identity of those who address the public over the broadcasting stations.
n asked the Minister representing the Postmaster-General, upon notice -
– The answers to the honorable member’s questions are as follows: -
l. - I anticipate being in a position to-morrow to furnish the honorable member for East Sydney (Mr. Ward) with a reply to his inquiries regarding the prevention of a broadcast lecture by “ The PlainSpeaking Gentleman “ over station 2SM.
l. - On the 18th October, the honorable member for Darling (Mr. Clark) asked the following questions, upon notice : -
I am now in a position to furnish the honorable member with the following reply to his inquiries: -
– On the 18th October, the honorable member for Darling (Mr. Clark) asked the following questions, upon notice : -
I am now in a position to furnish the honorable member with the following reply to his’ inquiries : -
Yes; so far as lies within its power. The commission is continuing its negotiations with the various newspapers in an endeavour to make the service more comprehensive. Much improvement in the news services has been made in the past two months. For example - ‘
Appreciative letters from all parts of Australia show that these improved news ser vices are welcomed, especially by country listeners. 3. (a) It is incorrect to say that “nearly half of that amount” (i.e., of the commission’s expenditure) is used in providing “ highbrow “ items. The proportion of classical music broadcast last year was eleven per cent, (b) See reply to 2.
y asked the Attorney-
General, upon notice -
– The answers to the honorable member’s questions are as follows : - 1 and 2. The answer to this question involves the full examination and explanation of the meaning of and procedural steps taken under the Covenant of the League of Nations. It is proposed to deal with these matters when legislation for the imposition of sanctions is introduced.
n asked the Minister representing the Postmaster-General, upon notice -
– The answers to the honorable member’s questions are as follows : - 1 and 2. The application for registration of the publication in question for transmission through the post as a newspaper was refused, and the applicants were informed accordingly. The application was refused because it was deemed that the publication was issued by, on behalf of, or in the interests of, an unlawful association.
d asked the Minister for the Interior, upon notice -
– The answers to the honorable member’s questions are as follows : - 1, 2 and 3. This matter has been listed for discussion at the next Premiers’ Conference.
en asked the Minister for the Interior, upon notice -
In view of the avowed desire of the Government to proceed with the unification of the railway gauges, in order to relieve unemployment, and in view of the difficulties raised by the South Australian Government, which have precluded the early construction of the Port Augusta-Red Hill Railway, will the Minister consider the question of proceeding with the construction of the Perth-Kalgoorlie section of the standard gauge, which would remove considerable unemployment, and to which proposal the State of Western Australia would presumably raise no obstacles?
– The Parliament of Western Australia passed an act authorizing the State Government to construct a railway of standard gauge from Perth to Kalgoorlie provided the Commonwealth Government constructed a railway from Port Augusta to Kalgoorlie within a specified period. The East-West railway was not constructed by the Commonwealth within the time specified, and consequently the authority under the Western Australian act lapsed. The question of the unification of railway gauges has been listed for discussion at the next Premiers’ Conference.
n. - The information is being obtained as far as practicable, and will be conveyed to the Leader of the Opposition (Mr. Curtin) at a later date in answer to a series of questions concerning the number of men employed by the State and Commonwealth governments on works carried out under contract and/or by day labour.
Royal Military College.
en asked the Minister for
Defence, upon notice -
– The answers to the honorable member’s questions are as follows: -
Flinders Naval College.
en asked the Minister for
Defence, upon notice -
– The answers to the honorable member’s questions are as follows : -
Cite as: Australia, House of Representatives, Debates, 23 October 1935, viewed 22 October 2017, <http://historichansard.net/hofreps/1935/19351023_reps_14_147/>.