1st Parliament · 1st Session
The President took the chair at 2.30 p.m., and read prayers.
asked the VicePresident of the Executive Council, upon notice -
Is it a fact, as stated in the morning paper of the 9th instant, that Captain Collins, Secretary of the Defence department, and Mr. McLachlan,
Public Service Commissioner, are at present, or recently have been, in Sydney, and engaged in. carrying on the business of their departments in attendance on Sir William -Lyne ?
– The answer to the honorable senator’s question is as follows : -
Captain Collins and Captain Creswell are both in Sydney with Sir William Lyne, .dealing more particularly with naval retrenchment. Mr. Mclachlan has been in Sydney dealing with mutters connected with his department.
asked the VicePresident of the Executive Council, upon notice -
Whether the Government will, during the slack winter season, push on with the work of connecting the General Poet-office, and all other Commonwealth properties in Melbourne and suburbs, with the sewerage system ?
– The answer to the ‘ honorable senator’s question is as follows : -
The sum of £3,000 is provided in the Additional Estimates under the department of Home Affairs for sewerage of the Post and Telegraph Offices, Victoria. The works will be proceeded with when funds are available.
Is it a. fact, as stated in the Sydney Morning Herald, that the members of the Commonwealth Government are of opinion that -
The sent of government of the Commonwealth must be in New South Wales ?
There is at the present time no such seat of government?
– The answers to the honorable senator’s questions are as follow : -
asked the VicePresident of the Executive Council, upon notice -
– The answer to the honorable senator’s questions is as follows : - 1 and 2. No; except as regards shipments before the 4th November. 1801. This date was fixed as allowing a reasonable time after the 4th October, 1901, when the Customs Act 1901 came into force, for acquiring knowledge of the prohibition in the Act at the port of shipment. This allowance was made in the spirit of paragraph (fi) of section 229 of the Act, exempting from forfeiture goods imported contrary to prohibitory proclamation until the lapse of a reasonable time lor acquiring knowledge of the prohibition at the port of shipment.
In Committee (consideration resumed from 9th July, vide page 14245) :
Division VII. - Oils., Paints, and Varnishes.
Item 82 - Blacking, including dressings, soaps, oils, inks, pastes, polishes, stains, and varnishes for leather ; Berlin and Brunswick blacks, furniture oil, paste and polish, and bronzing and metal liquids and powders . … ad valorem, 20 per cent.
Upon which Senator Lt-Col. Neild had moved -
That the House of Representatives bc requested to amend item 82 by adding the words “ and on and after 1st August, 1902, 15 per cent.”
– Through the courtesy of Senator Pulsford I am able to give the committee some information in regard to the duty upon bronzing powders, which I think will prove useful to them. No. 62 of the decisions of the Minister for Trade and Customs in regard to the Tariff sets forth that bronze in powder La to be charged at the rate of ls. per cwt., which is equivalent to 1 per cent. ; but, notwithstanding that decision, the Customs department is now collecting duty on the article at the rate of 20 per cent. Bronze powder is the raw material of the printing trade, being used for the cheaper kinds of work where gold and silver powders are too expensive. No plea can be made for this duty upon the ground that a local industry requires protection, inasmuch as the article is made only in Germany. My proposal is to reduce the duty upon all the articles mentioned in item 82 from 20 to 15 per cent. It was stated last night that the total amount of revenue expected from this item is £3,000 ; but the Vice-President has admitted on many occasions that the duties as reduced are bringing in more revenue than it was estimated the original Tariff would produce, and I think that this is especially a case in which a reduction of duty will not decrease the revenue, and will, perhaps, tend to increase it. Furthermore. I would point out that the duty which I wish to reduce is a duty which applies to such articles as stains, polishes, and varnishes for leather, and other articles which are used in the preparation of goods made within the Commonwealth. Therefore, to reduce this duty will be to assist local industries. It has been decided that a duty of 15 per cent, is sufficiently high to impose upon oilmen’s stores, and I think that, as the articles mentioned in- this item are of a somewhat similar nature, no higher duty should be charged upon them.
– When the decision to which Senator Neild has referred was given by the Minister for Trade and Customs, bronze-powder was treated as coming within item 85, under the designation of dry colour. At that time the item which we are now considering comprised only bronze and metal liquids; but on the 19th February it was amended to comprise bronzing and metal liquids and powders. The decision, which was perfectly right at that time, was that the 20 per cent, duty could not be imposed upon bronze in a powdered form, because it was not included in the 20 per cent. item. Now, however, bronzes in either a liquid or powdered form come under this heading, and the decision formerly given is useless. 1 hope no alteration will be made in this item. The difference between 15 and 20 per cent, may not seem very large, but the amount of revenue involved will probably be greater than was anticipated in the forecast to which reference has been made. It was estimated that this item would produce a revenue of £3,050, but the amount collected for six months was £4,093, which would be equivalent to something over £8,000 for the twelve months. The collections during the six months referred to must, however, be regarded as exceptional, and it would not be wise to estimate the revenue to be derived in the future upon the results for that period. Probably the actual revenue received for the twelve months will be something mole than £3,050 and something less than £8,000 - perhaps it will amount to about £5,000. It does not necessarily follow that a reduction of duty will result in the collection of a larger amount of revenue, and it is impossible to point to any figures which would support that idea. During the six months to which I have referred, trade has been very much disturbed, first of all because of “loading up,” and, secondly, because of the anticipations indulged in with regard to alterations of the Tariff. It is not likely that the importations will increase to such an extent as to make up for the reduction of the duty. In addition to the revenue aspect of this matter we have to consider the protection which it is desirable to afford to various established industries. Most, if not all, of the articles enumerated in this item are made within the Commonwealth. Their manufacture is very simple, and if, as has been stated, bronzing powder is not locally produced, it is an article which may be legitimately subjected to a duty of 20 per cent. If we are to reduce the duties upon certain articles because they are used by saddlers, and tanners, and others, we shall cut to pieces the policy of the Tariff. Some articles are the raw materials of other industries, but their manufacture mav give employment to a large number of people, and we should endeavour to so graduate our system of duties as to give reasonable protection under each item, and at the same time to secure a fair amount of revenue.
– The statement made by the “VicePresident of the Executive Council with regard to revenue will not bear examination. It will be seen that out of the £4,093 received as revenue under this item, £1,G71 was paid in New South Wales, although it was in that State that the largest amount of stocking up had taken place before the Federal Tariff was imposed.
– That is because there was no local production.
– I know that; but the duty is intended to displace the imported product, and thus destroy revenue.
– I did not make any comparison between the duties as collected before and since the imposition of the Tariff. Under the State Tariff in New South Wales large importations were made, and that state of affairs continues. The comparison I made was between the estimate of revenue that would be received under this item and the actual results since the Tariff has been in operation.
– Quite so; but that does not affect the accuracy of my statement. The amount of duty collected in Victoria under this item was only £600, and the effect of the duty in New South Wales, as in Victoria, will ultimately be to destroy revenue. More revenue would be collected under a 15 per cent, duty than” under a 20 per cent, impost, and under a 10 per cent, duty the revenue would be greater than under either a 15 or 20 per cent. rate. If the smaller States are to obtain any revenue from this item, and the whole business is not to be absorbed by the manufacturers in the larger States, the duty should be reduced.
– This item deserves more scrutiny than some honorable senators appear to suppose. It relates to much more important matters than bronze powders, to which Senator Neild has referred. If we consider the duties that were levied in the States prior to the introduction of the Federal Tariff, it will be seen that the present duty is a very fair one. Victoria levied a duty of 25 per cent., South Australia and Tasmania 20 per cent., and Western Australia 15 per cent., whilst in New South Wales the articles enumerated were admitted free. Some of the ingredients used in the manufacture of these, articles are dutiable, and it is necessary to impose a fair rate upon the finished products in order to protect those engaged in making them. All these goods are manufactured largely within the Commonwealth, and give employment to a considerable number of people, and in view of all the circumstances I. hope that the duty will be retained in its present form.
– I find that in 1899-1900 duties amounting to £800 were collected in Queensland upon the articles enumerated in this item, and, considering the condition of the finances of that State, I feel bound to resist any attempt to reduce the probable revenue. The ‘ duty levied under the Queensland Tariff was 25 per cent., and I think the present impost is a reasonable one. It is wrong for the representatives of the States which are strong financially to ignore the interests of those which are not in such a favorable position. It is argued that if the duty is reduced as now proposed, and the local manufacture increases, the revenue will diminish. I grant that : but I would point out that if our revenue falls off, our own people who are engaged in the manufacture of the articles will derive some benefit, and will be able to contribute towards the revenue in another way.
-Col. NEILD (New South Wales). - The Vice-President of the Executive Council has argued that the proposed reduction of duty will have a prejudicial effect upon the revenue. He told us that it was estimated that this item would yield £3,050 ; but upon the basis of the actual collections, he expects that it will yield £5,000 per annum. Even if we dismiss the proposition that the lower duty will result in an increase of importations, there will still be £2j000 for the Treasurer to come and go upon in excess of the estimate upon which the Tariff was framed. What justification is there for loading up the tanning industry with duties upon the materials used in the dressing and staining of leather ? We know perfectly well that bronze and scarlet and other coloured leathers are prepared by the use of some of the articles contained in this item. We have an example of that in the furnishing of this chamber.
– Why not separate bronzing from the other metal liquids 1
-Col. NEILD. - As all these articles carry an ad valorem duty, I do not see the necessity for so doing. Senator O’Connor tells us that instead of getting £3,000 a year from this item, as was originally estimated by the Treasurer, the minimum revenue which it is expected to yield is £5,000, and, therefore, the duty upon it can very well be reduced in the interests of the manufacturing trades.
– In answer to Senator Neild, I should like to point out that the original estimate of the revenue derivable from this item was made on the assumption that certain articles, which are not now dutiable, would be dutiable. We have abolished the duties upon tea and kerosene, and lowered those upon quite a number of articles. We have thus decreased^ the revenue producing items very largely, indeed, and therefore we need every penny that we can get. Although the amount now being collected from this particular item is more than was anticipated, we require all the revenue that we can obtain from it and from many other items to compensate for that which has already been lost.
– It has been left to Senator Neild to move for a reduction of the duty upon this item.
– He has argued in favour of it from a protectionist stand-point.
– I am not surprised at that, because he wrote to the Australian Star declaring that New South W ales would have to pay that price for federation. He said that it was better to have federation even with protection.
– The honorable senator knows that I did no such thing.
– The honorable senator is anxious to secure the admission of bronze at a lower rate in order that a, number of military gentlemen may polish up their old swords and make them look like gold instead of having the appearance of ordinaryrusty steel. If the honorable senator, who has been championing the widow and orphan, and also a free breakfast table, can show us that this particular bronze is a great necessity to the 4,000,000 souls spoken of by Senator Pulsford, let us listen to him. We all know, however, that the use of bronze is, generally speaking, a luxury. “When somebody wishes to send out a nicely printed invitation card to an evening party, he gets the printer to put bronze-powder upon the gold size, so as to give it an exceptionally good appearance, and thus the use of bronze very often crowds out the legitimate article in the way of gold and silver lettering. I chiefly rose to deprecate bringing before the committee paltry suggestions of this character. I am sure that Senator Dobson never contemplated a reduction upon bronze when he spoke of treating the half-dozen anomalies that were to be found in this Tariff. If the committee intend reducing the duties upon item after item in the way that it has been doing, where is the Treasurer to obtain his revenue? I suppose that if Senator Neild succeeds with his present proposal he will support the reimposition of the tea duty at a later stage. Probably that is his object.
Question - That the House of Representatives be requested to amend item 82 by adding the words “and on and after 1st August, 1902, 15 per cent.” - put. The committee divided -
Question so resolved in the negative.
Item agreed to.
Item 83. - Greases, axle, and thickened or solidified oils ; solid or viscous compounds for lubricating, and tallow unrefined, in packages not exceeding 41bs. in weight, per cwt., 4s.; n.e.i., per cwt. , 2s.
– I wish to draw attention to the fact that the duty, as it stands, constitutes a very heavy burden upon the leather industry. In this connexion I have received the following letter from Messrs. J. Bayley and Sons, tanners, of Botany, near Sydney : -
Being a large consumer of curriers’ and hard greases used in the manufacture of harness and shoe leathers, I would beg to draw your attention to the fact that there now exists a duty of 2s. per cwt. on these goods, which undoubtedly tends to greatly handicap the Australian tanner in the manufacture of his leathers. It is essential that curriers’ and hard greases be used to produce leathers equal in quality to that produced by foreign countries, and with whomw e are called upon to come into competition daily. In America the tanners, almost to a man, use curriers’ and hard greases in the manufacture of their leathers, for the reason they find they can produce a much better article, and in this connexion we find that to compete with our American friends, we must necessarily be progressive and up-to-date, but if we are debarred from using most up-to-date materials, then we are compelled to play second fiddle. I may state in the past I have used quite a quantity of the imported curriers’ and hard greases, and produced leather quite equal in quality to our foreign friends’ ; but now that wearedebarred, through the duty being placed on these materials, from continuing to use the imported greases, we can no longer hope to keep up the standard quality of our leathers. I would explain that sod-oil, degras, and cod-oil, and all such goods used in the manufacture of leather, are on the free list, and in this connexion I would ask your assistance to have curriers’ and hard greases also placed on the free list.
In the light of the statements contained in that letter, even protectionists should be willing to remove a duty which is admittedly a burden upon a manufacture. I would further point out that a very considerable business is done by Australia in the export of leather, and it seems to me undesirable that we should do anything to prejudice the trade. I move -
That the House of Representatives be requested to amend item 83 by adding the words, “ and on and after 1st August, 1902, curriers’ greases and hard greases, free.”
– I must certainly congratulate my honorable friend upon his adoption of protectionist principles, because it is solely upon those principles that he has submitted this motion. I object to the loss of revenue which the motion would involve. It would be grossly unfair and improper if, simply because some particular manufacturer had appealed to the free-trade side of the Senate, special exemptions were made in respect of the raw material of certain trades, and not in the case of others. This item ought not to be interfered with. In the first place, the motion, if carried, would involve a difficulty in administration ; it would be impossible to distinguish between these and many other greases included in the item. When the exemptions were being made the whole matter was considered by the department, and every exemption consistent with fair administration was allowed. The revenue actually collected under this item during the six months ending3lst March last was £1,537. That amount is not large, but we should not throw away sources of revenue in this manner. If the honorable senator thinks that the carrying of his motion will have any effect except upon the revenue he is much mistaken.
Senator PULSFORD (New South Wales). - I think that Senator O’Connor knows that free-traders desire on all occasions to give manufacturers their raw material free. That is one of the tenets of our creed, and, therefore, the honorable and learned senator is certainly not justified in saying that I have adopted protectionist principles. There is practically no revenue involved in this proposal.
– Queensland obtains £500 a year from the duty on these greases.
– I think that the motion should be supported on all sides, but as the protectionists themselves have ceased apparently to have any interest in the manufacturing industries, and appear to desire that I should withdraw the motion, I have no objection to do so.
Motion, by leave, withdrawn.
Item agreed to.
Item 84.- Oils-
Cotton seed, in bulk or otherwise, per gal. , 2s.
Other (including castor), in vessels not exceeding 1 gal., viz. : -
Quarter-pints and smaller sizes, per doz. , 6d.
Half -pints and over quarter-pints, per doz. , 1s.
Pints and over half-pints, per doz., 2s.
Quarts and. over pints, per doz., 4s.
Over a quart, per gal.,1s.4d.
In vessels exceeding 1 gal. , viz. : -
Olive, per gal.,1s. 4d.
Castor, China, colza, unseed, gasoline, mineral spirit oils, n.e.i., and cotton seed, when methylated pursuant to departmental by-laws, per gal., 6d.
Lubricating (mineral) and mineral, n.e.i., per gal., 3d.
Solar oil, residual oil, naphtha, benzine, benzoline, gasoline, per gal.,½d.
N.E.I., per gal., 6d.
– The committee have already decided that cotton seed shall be admitted free for manufacturing purposes under departmental by-laws. For the reason that actuated honorable senators in agreeing to that proposal - a desire to assist one of the great industries of Australia, the soapmaking trade - I propose that cotton-seed oil shall also be admitted free of duty for manufacturing purposes under departmental by-laws. If that proposal is agreed to it will be necessary to omit from the item the words “ and cotton seed when methylated pursuant to departmental by-laws,” so that the duty of 6d. per gallon on castor, China, and certain other oils may remain. It is proposed at present that cotton-seed oil if methylated shall be admitted at the rate of duty fixed for superior oils named in the same paragraph. I desire to make the item reasonable, and as the committee have decided by a very large majority that cotton seed shall be free, under the same terms, I do not think that it is necessary to discuss the matter at length. I move -
That the House-of Representatives be requested to amend item 84 by adding to the special exemptions the words, “ On and after 1st August, 1902, Cotton seed oil for manufacturing purposes under departmental by-laws. “
– The honorable senator has very properly based his case, such as it is, upon protectionist grounds. I should like to remind him of the circumstances under which it was decided to allow cotton seed to come in free under departmental by-laws. Senator Symon moved that cotton seed intended to be manufactured into oil should be admitted free. It was on the ground that the seed was to be manufactured into oil, that I did not divide the committee on the proposal. I presume that it was intended that cotton seed oil. should be made here. Now, however Senator Neild desires that such oil should be admitted free of duty in order that it may compete with this very article.
– Is that a protectionist principle 1
– It does not matter very much ; I am dealing with the matter as it stands. I object to cottonseed oil being placed on the list of exemptions, because we have already made special provision for its manufacture here. I object to the motion also on the ground that it would involve a loss of revenue. I would ask the honorable senator whether it is really worth while taking up the time of the committee with this proposal. I certainly shall object to it on the grounds of both revenue and protection.
– I desire to move that the duty on castor, colza, linseed, and mineral spirit oils, n.e.i., be reduced from 6d. to 3d. per gallon.” The reason why I select these oils for special treatment is that they are much more largely consumed than are China oil and gasoline, which are subjected to the same duty, and I have no information as to whether or not this is a very high duty upon the two last-named oils.
– Before the honorable senator submits his motion I would point out that in order to make the item consistent I propose to move the omission pf the words “ China “ and “ gasoline.” Those oils were originally made subject to a duty of Gd. per gallon. Subsequently they were transferred to the paragraph which embraces “ solar oil, residual oil, naphtha, benzine, benzoline, gasoline,” all of which are used as fuel for machinery purposes, and were made subject to a low duty for that reason.
– The honorable and learned senator’s proposal could follow my motion.
– Yes, if the honorable senator’s motion applies only to castor oil.
Senator PEARCE (Western Australia). - I point out that the reasons for a reduction of the duty upon linseed oil are stronger than are those for a reduction of the duty upon castor oil ; and if there is to be a test motion made, I should prefer that it should deal with linseed oil. I do not see why I- should not move the motion as first suggested, reducing the duty upon castor, colza, linseed, and mineral spirit oils.
– Because, if that is carried, I cannot deal with those to which I have referred ; I cannot go back.
– I take it I shall be allowed to make reference to the other items, though the motion I move refers only to castor oil. -I move -
That the House of Representatives bo requested to amend item 84 by adding to the duty, “ Castor, per gallon, Gd.,” the words “ and on and after 1st August, 1902, 3d.!!
Honorable senators will remember that this duty has reference only to the crude castor oil in bulk, because we have dealt with castor oil in bottles in the previous part of this item. Castor oil is used largely in conjunction with other oils as a lubricating oil. Colza oil is also used as a lubricating oil : it is used largely as an illuminant, and is also used in oil-engines. I think these two oils should bear a lower duty than 6d. per gallon, and when we come to deal with the next two items, linseed oil and mineral spirit oils, I shall have no hesitation in saying that they are taxed far too highly. I know what I am speaking about when ‘I say that a duty of 6d. per gallon is a tax of 25 per cent, on the value of linseed and mineral spirit oils. The retail price of linseed oil runs from 3s. to 3s. 6d. per gallon, and I shall be well within the mark if I say that the wholesale price upon which the duty is paid will
I be from 2s. 6d. to 2s. 9d. per gallon. Honorable senators will know that linseed I oil and mineral spirit oils are largely used I in the manufacture of paints, and if they look at the next item they will find that the duty imposed upon paints and colours ground in liquid is fixed at 2s. per cwt., and the duty upon colours dry, dry white lead, and patent driers and putty, is1s. per cwt., while the duty upon paints prepared for use is1s. per cwt. The result is that the local manufacturer of paints is not only not protected, but he is penalized by having his raw materials taxed at a higher percentage of duty than the taxation upon the imported prepared article. It is clearly an anomaly in a protectionist Tariff that we should tax the raw material of those who make up paints at a higher rate than the made-up article. Mineral spirit oils, I take it, include turpentine, and oils of that character, used in the manufacture of paints. This is a very important item from the revenue point of view, because I find that the Government estimate of revenue from oils in a normal year was £233,696.
SenatorO’Keefe. - That estimate includes kerosene.
– That is so, but the revenue collected for the six months from October to March amounted to £51,364, and for half that time kerosene was exempt from duty. I shall, I think, be within the mark in saying that under this item we shall realize revenue to the extent of £100,000 a year.
– Can we not leave this duty as it is, and impose a higher duty upon made-up paints ?
– I prefer to take the course I propose, because to put a higher duty upon made-up paints is to interfere with the coachmaking and the building industries by loading up their raw material.
– The honorable senator is in error in his quotation of the duty upon paints.
– I am not in error in my quotations from the Tariff. I may be to some extent in error as regards colza and castor oils, but the honorable and learned senator will not be able to disprove that a duty of 6d. per gallon upon linseed and mineral spirit oil is a very high ad valorem duty.
– I shall deal first of all with the duty upon paints. If honorable senators will look at the next item they will see that the duty upon paints and colours ground in liquid is 2s. per cwt., and that was quoted correctly by
Senator Pearce ; but the duty upon paints prepared for use is 4s. per cwt. Paints and colours ground in liquid are not prepared in such a way as to be immediately ready for use. It will be seen that ample protection is afforded for locally-made-up paint, and the duty to be put upon oil is taken into consideration.
– It is not protection to the extent of½d. per lb.
– We think it is quite enough. Senator Pearce really gave no reason for reducing this duty upon castor oil by one-half. Castor oil in the first place is used very largely in common with other oils for lubrication, and already we have passed item 83, under which wehave provided that the duty upon greases, axle, and thickened or solidified oils, solid or viscous compounds for lubricating, and tallow, unrefined, in packages not exceeding 4 lbs. in weight, shall be 4s. per cwt. If we reduce the duty upon castor oil, as the honorable senator proposes, to 3d. per gallon, we shall be altering very largely the balance of these things, which are used for the same purpose. In the next place, castor oil can be made, and I hope will be very largely made, in the Commonwealth. There is no reason why it should not be largely made and used in conjunction with other oils for lubricating. In addition to that, honorable senators must remember that we expect to get a great deal of revenue under the item. To show how important the whole item of oils is, from a revenue point of view, I may refer to the revenue actually collected. I am not able to separate castor oil from other oils dealt with, but taking the whole item, we have collected in six months no less than £55,349. That, of course, includes kerosene, and it would account for a considerable portion of the amount. Assuming that it accounts for two-thirds of it, there still remains a large sum collected from these oils generally. I think it would be a very serious matter to cut this revenue down to the extent of onehalf. Looked at from the protectionist point of view, it is quite clear that this is one of those products which should have some protection afforded to it, and a protection of 3d. per gallon would be very little.
– I was expecting that Senator Pearce would take up the ground that castor oil is largely used in most of the households throughout the Commonwealth. If he had done so we should have listened to him with greater sympathy. But a half-pint bottle of castor oil we know will go a very long way, and as it can be got for about 6d., it can well afford to carry a little duty. The honorable senator took up the ground that it was largely used for lubricating. That is very true, but it is also true that the castor oil plant grows like a weed in Queensland, and all we require is that there should be some little protection to the local producers to have all the castor oil we require manufactured in the Commonwealth. From the Statistics of Queensland for 1900, I find that there were imported during that year 4,678 dozen half-pint bottles of castor oil. Of these, 4,445 dozen came from the United Kingdom, 69 dozen from New South Wales, 34 dozen from Victoria, and 1 20 dozen from Germany. I find that of castor oil in bulk - and it is the bulk article. Senator Pearce is dealing with in his motion -391 gallons were imported from the United Kingdom, 27,471 gallons from New South Wales, 1,500 gallons from Victoria, 78 gallons from Hong Kong, and 36,697 gallons from India, or a total of 66,137 gallons. Considering that£7,878 worth of castor oil was imported from India, honorable senators will admit that it is a fair thing that the local producers should get some protection against the Indian article. An attempt was made to reduce this duty in another place, but though the majority in favour of its retention as it stands was not a large one, I think it was sufficient in view of the fact that in South Australia, and in other parts of the Commonwealth, this oil is produced. I submit that it is not quite fair that Senator Pearce should have introduced arguments in favour of a reduction of the duty upon linseed oil and mineral spirit oils, in support of a motion for reducing the duty upon castor oil.
Senator PEARCE (Western Australia). - The Vice-President of the Executive Council, in admitting that castor oil is a lubricating oil, and should therefore be put upon the same footing as the articles in item 83, has given his case away, because in item 84 we have lubricating oils placed at a duty of 3d. per gallon, the amount of duty which I am proposing. If castor oil is a lubricating oil, why should the duty imposed upon it be 6d. per gallon?
– We know that it is used for a great many other purposes.
– But the honorable and learned senator has said, as I say, that it is used largely as a lubricating oil. With regard to Senator Higgs’ contention, let me remind the honorable senator that in the State from which he comes castor oil in bulk was free, the intention evidently being to give the local refiners of castor oil some protection by admitting their raw material free. I believe that one effect of reducing this duty as I propose will be to secure the refining of the crude oil in the States. I have pointed out to honorable senators that this is a duty of 25 per cent, upon a raw material, whereas the duty upon paint is not anything like 25 per cent. It is only½d. per lb., and we know that the price of paint runs up in some cases to 9d. per lb.
Question - That the House of Representatives be requested to amend item84, by adding to the duty, “ Castor, per gallon 6d.,” the words, “and on and after 1st August, 1902, 3d.” - put. The committee divided -
Ayes … … … 11
Noes … … … 11
Question so resolved in the negative.
Motion (by Senator O’Connor) agreed to-
That the House of Representatives be requested to amend item 84, by omitting the word” China.”
– I move -
That the House of Representatives be requested to amend item 84, by adding to the duty, “Linseed, per gallon 6d.,” the words “and on and utter 1st August, 1902, 3d.”
I ask honorable senators to bear in mind that linseed oil does not stand on the same footing as castor oil, and there are stronger reasons why the duty upon it should be reduced.
– I need not repeat the arguments I have already used. I object to the motion for the reasons I have already stated, and for the reason that we have expressly provided for the manufacture of this oil here, we ought to give it a certain protection.
Question put. The committee divided -
Ayes … … … 11
Noes … … … 11
Question so resolved in the negative.
Motion (by Senator O’Connor) agreed to-
That the House of Representatives be requested to amend item 84, by omitting the word ‘ gasoline.”
– I recognise that I run a very great risk in rising to propose ,a motion, chiefly the risk of being called a protectionist. I propose to incur that risk, and also to incur the risk of ‘being accused of trying to do something for the manufacturing industries ‘ of the Commonwealth. The last reason is the one which chiefly actuates me in proposing the motion. I move -
That the House of Representatives be requested to amend item S4, by adding to the duty, “Lubricating (mineral), and mineral* n.e.i., per gallon, 3d.,” the words “and on and after 1st. August, 1902, free.”
I should like to say, first of all, that lubricating oil is an absolute necessity wherever machinery is used. We cannot run engines of any kind in connexion with mining, agricultural, or manufacturing industries, without the use of lubricating oils, and to impose a tax upon -them is to tax the emplo3’.ment of machinery. I point out to honorable senators, and especially to those who come from Victoria, that in Victoria there was once a duty upon theselubricating mineral oils ; but the folly of it was seen, and, therefore, under the Victorian Tariff both lubricating and mineral oil is exempt from duty, because it was considered that to put a duty upon such oils would be analogous to putting a duty upon an article like coal, since there is practically no lubricating or mineral oil produced in Australia. To impose a duty, however small, upon lubricating oil is to impose a tax upon all users of machinery of every kind. This duty will have to be paid by the users of marine engines, the users of machinery for> agricultural, pastoral, and manufacturing purposes, and by those engaged in the mining industry, which cannot be carried on without machinery. It is a tax upon the attempt of civilized humanity to substitute machinery for hand work. Furthermore- and I mention this incidentally, and not as a matter to which I attach much importance - these oils are the raw material used in the manufacture of grease. A duty has been placed upon grease, presumably because it is manufactured within the Commonwealth. While I do not desire to see duties imposed merely in order that industries may flourish, I am anxious to prevent the hindering or impeding of any industry by unfair taxation, and, therefore, I feel that the grease-making industry should not- be hindered by a duty upon its raw material. I do not think that the Vice-President pf the Executive Council will be able to get the committee to vote for the duty as a revenue one, because, as it is analogous to a duty upon coal, it is an unfair and a stupid tax. It may be said that as a company has lately been floatedto produce mineral oil in Tasmania, this duty should be imposed to protect it, but the success or failure of that company will not be affected to the slightest extent by its imposition.
– A duty of 3d. a gallon may assist the industry.
– It may do so, but it will not determine its success, and the absence of a duty will not determine its failure.
– In South Australia there was a duty of 6d. per gallon upon lubricating oil.
– I have pointed out that the Victorian Tariff, which was the highest protective Tariff in Australia, contained no duty upon lubricating oil, because it was recognised that such a duty would hamper industry in all directions. I am informed that the price of lubricating oil, delivered free on board in New York, is £3 per ton, so that a duty of 3d. per gallon is equivalent to a duty of 100 per cent.
– One important argument against the proposal of the honorable and learned senator is that, upon the lowest estimate, the remission of this duty will involve the loss of £25,125 of revenue; and it must be remembered that in all cases the estimate of revenue has been very much below the actual receipts from the Tariff
– How much has been returned by the duty up to the present time?
– I cannot give the honorable and learned senator that information, because a return has not been kept of the receipts from this particular line. The honorable and learned senator, however, has shown that lubricating oil is in very general use, and not made within the Commonwealth to any extent, so that the importation of it must be very large. It would be absurd for us to give up £25,125 of revenue. It is quite true that under the Victorian Tariff lubricating oil was admitted free of duty, but that Tariff imposed a duty of 25 per cent, upon machinery, and, inasmuch as certain kinds of machinery could not be made within the State, and had to be imported, the burden upon those who used machinery in Victoria was greater under that Tariff than it will be under the Commonwealth Tariff.
– And the conditions are different, because now there is an infant oil-making industry in Tasmania.
– Yes ; and where we can obtain revenue, and at the same time give encouragement to an industry in
Tasmania, or elsewhere within the Commonwealth, we desire to do so. But,while Victoria imposed no duty upon lubricating oil, South Australia, Queensland, and Tasmania each imposed a duty of 6d. a gallon upon it. In 1899 the return from this duty amounted to £4,696 in Queensland, to £3,072 in South Australia, and to £1,039 in Tasmania.
– Then the Government proposal reduces the Tasmanian revenue by £500.
– Even if Tasmania will obtain only £500 under this Tariff, that amount cannot be pitched away. The returns from this duty will increase in the future, if Tasmania becomes the manufacturing centre which I hope she will become. Seeing that Tasmania and Queensland particularly want revenue, it is strange that we should be asked to take from them the revenue which they have formerly been receiving from this duty. The Customs officer who is assisting me has estimated that the amount of revenue which will be obtained from the duty upon lubricating oil will be about £43,000, and that of that amount £14,000 will be obtained in Victoria. I hope that in the interests of revenue, and, to a slight extent to afford protection to an existing industry, the committee will leave the duty as it stands.
-I am compelled to vote for the reduction of the duty. Lubricating oil has hitherto been admitted into Victoria free of duty. Those who use machinery of every kind have already to struggle very hard, and a bad time is coming for them in the future. That being so, we should do all we can to prevent them from being handicapped.
– I think Senator Clemons must have been wrong when he stilted that this duty amounted to 100 percent.
– It amounts to about 21 per cent, on the average.
– I find that the, importations of mineral and other oils into Queensland, in 1900, under a duty of 6d. per gallon, were - from the United Kingdom, 8,447 gallons ; New South Wales, 88,729 gallons; Victoria, 60,091 gallons; New Zealand, 40 gallons ; Hong Kong, 15 gallons; Germany, 194 gallons; United States, 49,941 gallons; the total value being £18,370. The countries of origin of these imports were - the United Kingdom with £2,166 worth; India, £51; Canada, £3 : China, £2 ; Germany, £108 ; France, £10; and the United States, £15,02S. The total amount of duty collected was £4,642 3s. 8d. There was a local production of mineral oils within the Commonwealth, and the quantity entered for home consumption in Queensland was 15,969-J- gallons, valued at £1,002, the duty paid amounting to £399 4s. 7d. The duty of 3d. per gallon seems to me to represent a fair compromise. It leans more to the revenue than to the protectionist side, but it will assist our local producers to some extent. A considerable quantity of mineral oil is produced in New South Wales, and I hope Senator Gould will consider the industry there, and extend to it as much consideration as he would give to soap makers like Messrs. Lever Brothers.
– The Government cannot afford to give up the revenue derived from this duty, which extends a certain amount of incidental protection to industries which are carried on in Tasmania and New South Wales. Senator Fraser has pointed out that no duty was levied upon lubricating oils under the State Tariff in Victoria, and that the present impost must prove burdensome to all those who use machinery for manufacturing and other purposes. I would ask the honorable senator to recollect, however, that Victorian manufacturers have appealed to the Commonwealth Parliament to grant them a large measure of protection for various industries, and that we should be prepared to extend -similar consideration to those who are engaged in industrial enterprises in other States. For my part, I am prepared to take a broad view of this question, and to ask the Victorian manufacturers to submit to this duty for the sake of those who are engaged in the manufacture of lubricating oils in other parts of the Commonwealth. I hope that in the near future Tasmania will become a large manufacturing centre. At to-day’s meeting of the select committee of the Senate which is inquiring into the question of steam-ship communication with Tasmania, one gentleman, in the course of his evidence, stated that a very large impetus had been given to manufacturing industries in Tasmania, and that he looked forward to very important developments there within a very short time. I desire to encourage industrial enterprise in all the States, and I shall cheerfully , vote in support of the duty now imposed.
– Senator Clemons appealed to those who claim to have the interests of the mining industry at heart to support his proposal, and dwelt with considerable emphasis on the fact that lubricating oils are used very largely in connexion with ‘machinery employed not only for mining, but for manufacturing and other purposes, and that the duty would constitute a very heavy tax. I claim to have quite as much interest in the advancement of mining as has- any honorable senator, but I also wish to show every consideration for the interests of those who are engaged in the manufacture of lubricating oils. We hope that very soon the oil industry in Tasmania will assume large proportions, and that the manufacture of lubricating oils will form a very important feature. The cost of lubricating oils used in connexion with machinery represents a very small percentage of the working expenses, and therefore the duty will not prove so burdensome as has been represented. We have been told that New Zealand has admitted mining machinery free of duty in order to help her mining industry; but honorable senators who are seeking to secure the free admission of lubricating oils have not referred us to the example of that colony in support of their arguments. New Zealand levies a duty of 6d. per gallon upon lubricating oils ; and, in view of the duties which have been hitherto collected in the various States, I consider that the rate now imposed represents a fair compromise. Senator Fraser has expressed his intention to support the amendment because he finds that lubricating oils have hitherto been admitted into Victoria free of duty. I venture to say that the honorable senator would not have bothered about the matter if a duty had been collected in Victoria in the past. The honorable senator looks rather too closely at the interests of his own State, and I trust that he will be induced to take a broader view of the question.
Senator BARRETT (Victoria).- I find that in Victoria in 1900 there were three factories, employing 38 hands, engaged in the manufacture of oils. Last year these factories employed 63 hands. .This furnishes me with an additional reason for supporting the duty as it stands.
– The honorable senator who has just discovered another reason why he should support the duty, seems to forget that the Victorian establishments to which he has referred have been able to carry on their operations successfully without the aid of a duty. No doubt they have been able to import their raw material free of duty, and as they will have the same advantage under the present Tariff, it cannot be contended that they will be prejudiced by the abolition of the duty. It is very desirable that those who are necessarily consumers of this oil should be given an opportunity to obtain it at the lowest possible price. The amount of revenue which Senator O’Connor has pointed out will be derived from this item indicates the large extent to which lubricating oils are expected to be used within the Commonwealth. When, however, I find that the proposed duty is equivalent to 100 per cent, upon the price of the article f.o.b. in America, I am bound .to say that it is altogether excessive. If it be correct that this particular oil can be obtained f.o.b. at New York for 3d. per gallon, the proposed duty constitutes an extremely heavy impost. Under such circumstances, the transit charge’s ought to be more than sufficient to assist the local industry.
– I should like to correct an error into which Senator Clemons has fallen regarding the value of this oil. The quantity of lubricating mineral oil which was admitted free into Victoria in 1900 was 1,165,597 gallons, the value of which, according to the Victorian Statistical Register, was £65,569. A simple arithmetical process will disclose the fact that that amount represents about ls. 1½d. per gallon.
– Is that f.o.b. in America ?
– We have nothing to do with the price f.o.b. in America. We have only to deal with the value of the oil as landed here. The duty is charged upon the f.o.b. value, plus 10 percent.; and I take it that 10 per cent, fairly represents the transit charges. If, therefore, we take the ‘Victorian value of the oil imported, it cannot be held to include more than the 10 per cent, upon the f.o.b. price. Taking ls. l£d. per gallon as the price of the article landed here, a duty of 3d. per gallon is equivalent to about 21 per cent, instead of 100 per cent, as has been stated. The other figures which I gave ‘ are perhaps more important, and I should like to show how they were arrived at. I stated that the proposed duty will yield a revenue of £43,375. In estimating these matters upon the basis of population where an article is free, it is usual to take three times the imports of Victoria as the imports of the Commonwealth. Upon that basis a duty of 3d per gallon would yield the revenue which the Government expect to derive from this item, namely, £43,375. Surely nobody can deny that that is a fair basis upon which to make such a calculation. But assuming that the total revenue from this source is only about £40,000, how can we in a light and airy manner sacrifice that amount?
– It is double the amount of the Treasurer’s estimate.
– It may be, but over and over again it has been shown that these estimates are very much below the mark. Reference has been made to machinery, but sure y we must look at the position which machinery occupies under this Tariff as a whole, and not at this particular item only.
– If a machine costs several hundred pounds, its owner can well afford to pay two or three shillings for the oil used in lubricating it.
– But the machine may be worth only £30.
– How much oil will be required for a machine which is worth only £30 1 At any rate my comparison will stand irrespective of what the value of the machine may be. I hold that we must look at the effect of the proposed duty upon machinery generally, but the question at issue is whether we shall altogether give up the revenue upon this article, and I say that upon no ground of fairness to the States is it possible to justify the motion submitted.
– I would point out that in three of the States a duty of 6d. per gallon formerly operated upon lubricating oils, whilst in the other three they were admitted free.- Roughly speaking, therefore, the Government proposal constitutes a compromise. Moreover, upon item 83 the committee decided to impose a duty of 2s. per cwt. upon lubricants, and in the following item a tax of 6d. per gallon was levied upon castor oil for lubricating purposes. Now an attempt is made to remit the duty upon lubricating oil, and 1 to allow it to come in free. With one hand, therefore, we are asked to offer protection to the manufacturers of lubricants, and with the other to take it away from them. Surely that is an aspect of this matter which has not struck honorable senators.
– It has been admitted free into Victoria for some time.
– It does not follow that the course adopted was correct. We have heard a good deal about the poor manufacturer who requires oil for his machinery, but I venture to say that not one manufacturer in Victoria will grumble if a duty of 3d. per gallon is imposed upon lubricating oil. Why should they ? They are protected, and why should not the man who produces lubricants here from natural products receive some protection. I commend this to the honorable senator who has submitted the motion.
– -This is another instance in which Senator O’Connor’s figures are absolutely delusive. He has stated that the minimum revenue which the Government expect to derive from lubricating oils is about £40,000.
– I said £43,000, and that the estimate was based upon the importation into Victoria.
– I find that, as a matter of fact, between the 9th of October of last year and the 31st of March of the present year - the first six months of the operation of this Tariff - the total revenue derived from all oils was only £51,000. That amount included the revenue received from a duty of 3d. per gallon upon kerosene. I do not suppose that Senator O’Connor will contend that other oils are more largely used than is kerosene. I take it for granted that the amount obtained from kerosene during the period indicated comprised the greater portion of the £51,000 which was received. When one considers that fact it will be seen how absolutely ludicrous it is for the Government to- anticipate a’ revenue of £40,000 from lubricating oils. When we remember that the duty upon kerosene has been abolished it will be recognised that £40,000 will probably represent more than 60 or 70 per cent, of the total revenue which the Commonwealth will receive from oils. Under these circumstances, I do not think that we need fear the loss of revenue in the way that has been suggested. Senator O’Connor has used an entirely erroneous set of figures, and, therefore, all his arguments are valueless.
Senator CLEMONS (Tasmania). - I admit at once that if the Vice-President of the Executive Council could show me that any motion which I submitted was likely to result in the sacrifice of a large portion of the revenue of Tasmania, I should hesitate to press it. I am delighted, therefore, that Senator O’Connor should have employed the argument which he has used. But, seeing that he has employed it, I am pleased to refer him, not only to a few figures, but to the next item upon the Tariff, viz., kerosene. He accuses me of destroying Tasmanian revenue, because upon his own showing that State will lose £620 at the cost of encouraging the use of engines and machinery. But I would point out that at the cost of nothing whatever, except exempting from taxation those persons who ought to contribute to the revenue, he is sacrificing £4,000 of Tasmanian revenue by admitting kerosene free. That is my reply to the Vice-President. Let honorable senators look at the figures supplied to them by the Treasurer. He estimated that Tasmania would receive £625 from lubricating oils. In the next column he calculated - and he knew what he was doing - that that State would lose £4,375 by the abolition of the duty upon kerosene. I hope that I shall not hear Senator O’Connor again direct against me an argument to the effect that I am seeking to destroy the revenue of Tasmania, Queensland, or any other State. In pursuance of my free-trade principles I desire to exempt from taxation anything that will tend to encourage manufactures and industries, and such an accusation comes with a very ill grace from the honorable and learned senator. As a freetrader, I am prepared to help every industry by removing hindrances out of its way. I do not believe in the figures quoted by Senator O’Connor, and I think he has been deceived in regard to them. I admit that I underestimated the value of lubricating oil f.o.b. in New York; but the range in prices is t so great that it is very easy for one to make a mistake. The oils can be obtained from 6d. per gallon upwards, and when I mentioned 3d. per gallon I was certainly in error. This has become an interesting subject to me since I heard the statements made by Senator Barrett, that there are factories in Victoria which employ 53 hands in the manufacture of the very article with which we are now dealing. If that is so, I hazard the suggestion that the industry is being carried on to the destruction of revenue, because it is producing lubricating oil out of crude petroleum which is admitted free. If the Government are so anxious to obtain revenue, why do they allow crude petroleum to be free of taxation?
– Crude petroleum is the raw material of a number of manufactures, and this shows how difficult it is to attempt to alter a system in a haphazard way.
– No. I have suggested that it is probable that a certain quantity of lubricating oil, the subject matter of this item, is being made in Victoria out of crude petroleum, and Senator O’Connor agrees with me. I would point out to him that the corollary to that is the question, why do the Government allow crude petroleum to come in free if they desire to secure revenue? If these factories are to prosper they will prosper entirelyat the cost of revenue. I have discharged my conscience in this matter. I began to get afraid when I heard many of the statements which were made so rashly by the Vice-President of the Executive Council, but the more I look into the question the more I am convinced that Tasmania will suffer very little loss if this motion is carried. Comparing this with the proposal to make kerosene free, the State will not suffer anything, because if that article were taxed, seven times the revenue would be obtained from it as that which the Government hope to collect from the duty on lubricating oil. I shall never be persuaded to hestitate to reduce a duty by the argument that the effect of a reduction will be to lessen the total revenue. We ought to consider, not the total revenue, but the particular State to which that revenue is destined to go, and I say, without hesitation, that there is no reason for taxing the people of New South Wales to a greater extent than they are taxed now. It is admitted on all sides that that State has an overflowing revenue, roughly speaking, £1,000,000 more than it needs. We never think of imposing taxation unless it is necessary. We recognise that, so far as this Tariff is concerned, New South Wales does not want it, and therefore the argument is unassailable that if it can be proved that the bulk of the revenue derived from a particular tax goes to a State which does not require it, we should not impose it. If I could be satisfied that an item of revenue to Tasmania would be lost, I should be loth to interfere with a duty as long as it was fair and reasonable, but in this case all that I find is that, according to an estimate, Tasmania will lose some £600 a year if this proposal is carried. I have no hesitation in adhering to my motion.
– I feel that I must reply to something that has fallen from the lips of the Vice-President of the Executive Council, who charged Senator Gould with want of due regard for an industry in New South. Wales, which is giving some little attention to the production of a mineral oil lubricant.
– I do not think I referred to Senator Gould. He has not spoken on this item.
– Perhaps the honorable and learned senator used Senator Gould’snamebyaslipof the tongue. However, I am one of the representatives of New South Wales, and in that State some little effort is being made to manufacture lubricating oil. But what is that oil made from?From raw petroleum extracted from the shales which are found there. Yet Senator O’Connor is fathering a Tariff that proposes to allow crude petroleum to come in free of duty to compete with the local production. There can be no possible reason for saying that any honorable senator on this side has not a due regard for the lubricating oil industry of New South Wales. Senator O’Connor has pointed out - and I sympathize with him - how difficult it is to put in proper order all the conflicting interests which arise under such a complex Tariff as this. I cannot but call to memory a couple of lines written by Sir Walter Scott which seem to be singularly appropriate to the attitude of the Vice-President of the Executive Council and his colleagues -
Oh, what a tangled web we weave
When first we practise to deceive !
There is another objection to the duty, which, notwithstanding the existence of this infantile industry somewhere in the Blue Mountains of New South Wales, will cause me to vote for the motion. I find that the bulk of this tax will fall upon the Railway departments of the different States.
It will afford another splendid opportunity for the legal profession to become wealthy in practising before the High Court in the settlement of disputes between the Commonwealth and the States, because, most undoubtedly, the bulk of the revenue from this duty will come from the State Government railways. I do not believe in assisting to provide material for huge litigation, and that is why I intend to vote for making these oils free.
– The ground upon which this motion has been submitted is that, if carried, it will relieve the owners of machinery from an unnecessary burden. I would ask Senator Clemons, however, whether he thinks that a consideration of the small relief, if any, which would be afforded by the remission of this duty should induce the committee to agree to this loss of revenue. If these oils are made free, Queensland will lose very considerably. Something like £4,000 was collected in that State during 1899-1900 from a duty of 6d. per gallon on these oils. The proposal of the Government is that a duty of 3d. per gallon shall be imposed, and I ask Senator Clemons to view the question, if not from the stand-point of his own State, at least from the stand-point of the others. The State of Queensland cannot afford to lose revenue. I do not wish to impose unnecessary taxation upon the people, but the administration of government cannot be carried on without revenue, and therefore I should like to see a duty imposed upon both lubricating oil and kerosene. The duty now under consideration cannot be considered a burdensome tax upon the users of machinery, because 3d. per gallon is only ¾d. per quart, but, if it is removed, the loss to the Commonwealth will be considerable.
Question - That the House of Representatives be requested to amend item 84 by adding to the duty “Lubricating . . . per gallon, 3d.,” the words “and on and after 1st August, 1902, free”- put. The committee divided -
Ayes … … … 11
Noes … … … 12
Majority … … 1
Question so resolved in the negative.
– What is the position of gasoline and china oil ?
– China oil is on the free list, while gasoline is subject to a duty of½d. per gallon.
– I move -
That the House of Representatives be requested to amend item 84 by adding after the words “Kerosene, free,” the words “ and on and after 1st August, 1902, per gallon, 3d.”
I move this motion with great reluctance, because the duty is one which I have never believed in and one the abolition of which I have advocated : but the finances of Queensland are in such a deplorable condition - no other words will fit the case - that I am absolutely obliged to take this course. A great deal of opposition was shown by many of the citizens of Queensland to the entrance of that State into the union, but we agreed to federate upon the assurance that our finances would not be unreasonably disturbed. It wasgenerally admitted that, with theabolition of Inter-State duties, Queensland would lose a large amount of duty, which was estimated at £144,000 per annum ; though I find, upon looking through the reports ofthe convention debates, that the speakers on the subject all assumed that nothing would be done by the Commonwealth Parliament to unnecessarily disturb the financial equilibrium of the States. If honorable senators will refer to page 3 of the papers laid upon the table by the Vice-President of the Executive Council not very long ago, they will see that Queensland’s deficiency in regard to customs and excise receipts is there set down as £280,066, which, of course, includes the £144,000 to which I have already alluded. It is there estimated that instead of receiving from the Commonwealth £1,281,420, which we previously received from customs and excise, Queeusland would receive only £806,447; but, according to the Treasurer’s statement at the close of the financial year, Queensland’s receipts will be still further reduced by about £30,000, bringing them to a little more than £770,000. Since these estimates were made the duties upon tea and kerosene have been remitted. Both duties under the Queensland Tariff were very high. From the duty upon tea, which was 6d. per lb. in bulk, and 8d. per lb. in packets, we received, annually, about £87,000, and from the very high duty of 6d. pei- gallon upon kerosene, £44,000. Those duties have now ceased to be collected, and we have lost a further amount of about £14,000 per annum by the reduction of the duty upon rice ; so that our actual receipts from the Commonwealth will be little more than £600,000. I have no desire to impose unnecessary burdens upon the people, but the financial condition of Queensland is such that we must have more revenue.
– What is the rate of the Queensland land tax ?
– I am in favour of a land tax, an income tax, and an absentee tax ; but only a comparatively small amount could be raised from those sources. The amount of £23,000 or £24,000 which would be derived by Queensland from a tax of 3d. per gallon upon kerosene would mean a great deal to that State at the present time. I hope that honorable senators will view this matter dispassionately and free from prejudice. Queensland is in a necessitous condition, and the outlook is by no means encouraging. She has sustained heavy losses in cattle and sheep, and as all means of employment have been largely restricted the revenue derived from the ordinary sources of taxation will be considerably reduced. It has been estimated that n duty of 3d. per gallon upon kerosene would yield a total of £150,000 to the Commonwealth. .Queensland, under the State Tariff, derived £44,000 per annum from a duty of 6d. per gallon, and even though a duty of 3d. were imposed she would sustain a heavy loss. When the duties hitherto charged by the States are considered, the duty of 3d. per gallon would represent a fair compromise. In New South Wales, Victoria, and Western Australia, kerosene was admitted free of duty.
In South Australia a duty of 3d. per gallon was levied, and in Tasmania and Queensland the duty was 6d. per gallon. Canada imposed a duty of 2Jd. per gallon upon kerosene, and New Zealand, whose Government is the most democratic in the world, continues to collect a duty of 6d. per gallon. I am not anxious to tax the people, arid I am advocating a kerosene duty as a matter of sheer necessity. Queensland is in urgent need of revenue, and I appeal to honorable senators to extend assistance to her as far as they possibly can. I hope that in the very near future we shall be in a position to dispense with any such duty. Nothing pains me more than to have to take up my present attitude. I do not wish to reflect upon my honorable colleagues from Queensland who may disagree with me. I do not impugn their motives or charge them with being the enemies of their State, but I think they are mistaken in supposing that we could raise the large amount of revenue we require by means of land and income taxes, or by imposing a tax upon absentees. These taxes would not at the present time yield anything approaching a sufficient amount of money to place Queensland in a reasonable financial position. Under all the circumstances, I would appeal to honorable senators to extend special consideration to the State which I represent, by restoring the duty upon kerosene.
– I intend to oppose the amendment. When the Tariff was originally introduced the Government took the view that kerosene ought to be taxed, and personally I am of opinion that if the necessity arose, that article should be subjected to a duty. The House of Representatives, however, decided by a considerable majority that kerosene should be admitted free of duty, and after that determination was arrived at a number of alterations were made in the Tariff, all of them having relation to the abolition of the duty upon kerosene. I look at the Tariff as a whole, and as being, in its essence, a compromise, and I do not propose to ask the Senate to disturb it. If it is found necessary, on some future occasion, to raise more revenue, the Government may take action in this and other directions, but at present we regard the Tariff as a fair one on which to collect duties, and I must, therefore, oppose the amendment.
– I intend to follow the course indicated by the leader of the Government. I recognise that perhaps kerosene, tea, and other articles are very fair subjects of taxation, but as the Government are satisfied with the amount of revenue which will be derived by the collection of the duties provided for under the present Tariff, I do not feel justified in adding to the taxation that will ultimately be imposed.
– We feel satisfied with the Tariff as it left the House of Representatives, but not with the Tariff as suggested by honorable senators.
– I am very glad to know that the Government are satisfied with the Tariff as it left another place, but I presume that they would have been glad if an opportunity had presented itself to remove a number of the anomalies it contains. The question whether the reductions suggested by this Chamber will have the effect of considerably diminishing the revenue cannot be decided until the Tariff, as finally passed, is in actual operation. I take it that it is no part of our duty at present to add unnecessarily to the burdens of the people. I believe that a duty upon kerosene would have such an effect. If it is subsequently found that the revenue derived under the Tariff is insufficient to fully meet our requirements, it will be incumbent upon the Government to take measures to supply the deficiency. I cannot refrain from expressing very great sympathy with those States which fear that they will derive too little revenue under the present system. At the same time, we must consider the interests of the people of the Commonwealth as a whole. I hope some means will be devised either by the States themselves or by the Commonwealth to enable the States whose revenues are deficient to raise the money necessary for conducting their affairs in a satisfactory manner. We know that severe retrenchment will have to be resorted to. Several of the States have already begun to reduce their expenditure, and no doubt others will find it necessary to adopt a similar course. It will be of advantage to some of the States if the public expenditure is reduced. We cannot blind ourselves to the- fact that in some cases the more money the Government has, the more it will spend, and that those in authority do not always recognize the necessity for exercising care in the expenditure of public money. In the meantime there is nothing to justify us in imposing excessive burdens upon the people. The Government estimated £157,500 would be derived from the duty of 3d. per gallon upon kerosene. That is a very large amount to be raised by means of a duty upon one commodity, and until we can feel assured that there is urgent necessity for it, I do not propose to support the imposition of any such tax. At the same time I reserve to myself the right, if the necessity should arise, to deal with this, or any proposal, in such a way as I believe will conduce to the interests of the Commonwealth at large.
– The necessity has already arisen in Queensland.
– I know that the honorable senator has a vivid idea of the necessity which exists for raising revenue in Queensland. We cannot help feeling great sympathy for the honorable senator, especially when we remember that at one time he strongly opposed the imposition of a duty upon kerosene, and that it is only dire necessity that causes him to take up his present attitude. I do not think, however, that it would be wise, for us to follow his lead at the present time. A considerable majority of honorable members in another place were content to allow this matter to stand for the present, and to deal with it in the future as necessity might dictate, and we should endorse that view.
– I am sorry that I shall have to oppose Senator Glassey’s motion. I agree with Senator Gould that we should not unduly increase the burdens of the general taxpayer. As evidencing what this means to the average home in Queeusland, where kerosene is largely used, I may mention that prior to the abolition of the duty, the price of that article in the northern State was 6s. 3d. per tin. Since the duty was remitted, the same brand of kerosene can be obtained for 3s. per tin - a reduction of 100 per cent.
– The remission of the duty does not account for the difference.
– Formerly the duty in Queensland was 6d. per gallon. Senator Glassey now proposes to make it 3d. per gallon. Should such a tax be levied upon kerosene, its price would probably be increased to 4s. 6d. per tin.
– What sized tin does the honorable senator refer to ? I Senator HIGGS. - I am speaking of a four-gallon tin. Prior to the abolition of the duty people in Queensland were required to pay 6s. 3d a tin, but now they can obtain the same sized tin for 3s.
– No, they cannot.
– I have received letters from Queensland urging me to use my best endeavours to secure the admission of kerosene free, and pointing out that since the abolition of the duty upon that article people have bought it at the reduced price which I have mentioned. In the majority of the Queensland homes kerosene is used, because, it being a new country, the people have not yet secured the advantages conferred by electric light, gas, or acetylene. Concerning the deficiency in the revenue of Queensland, I desire to point out that hitherto the State Government have neglected to avail themselves of those sources of taxation from which revenue is derived in all the other States.
– That is by “taxing the other chap.”
– By taxing the “other chap “ according to his ability to pay. I remember that, in his second reading speech upon this Tariff, Senator Clemons, when referring to the various systems of taxation, and to the principles which should guide us, mentioned that it had been set down that a man ought to contribute to the revenue according to his ability to pay. That is the Adam Smith doctrine, and it is a very sound one. A man ought to contribute to the cost of government-
– In accordance with the amount of protection that the Government afford him. The more goods or property he possesses, the more he ought to pay.
– That amounts to the same thing. He receives a certain protection from the Government, and if he did not receive that protection he would not have the income which he enjoys. Hitherto the Queensland Government have failed to impose either a land tax or an income tax. It is true that they have adopted a dividend tax, but I hold that if they imposed an income tax, absentee tax, and land tax, with exemptions, such as operate in other places, and which do not press unduly on the small allotment man, the revenue derived from these sources would far more than compensate for the loss sustained by the abolition of the duties upon tea and kerosene.
– Surely Senator Glassey will not deny that Queensland is as wealthy as any other State.
– Roughly speaking, South Australia gets £80,000 or £100,000 from those sources, and Queensland ought to derive about the same amount.
– I would point out that Queensland has a population of 500,000 as against 350,000 in South Australia, and possesses far greater resources. Moreover, her population is growing. I am sure that Senator Fraser and others will not deny that it is probable that in the future Queensland will possess a population equal to that of Victoria and New South Wales. It is regarded as the coming State, and surely the Government of Queensland may fairly draw upon the sources of taxation which are open to them. Indeed, the Philp Government at the present time are proposing to introduce an income tax for the purpose of reducing the deficiency.
– They will not get much from that tax just now.
– That remains to be proved. Not only have the Queensland Government neglected to impose a land tax, but they have not attempted to exact their fair share of revenue from the Crown lands, some 400,000 acres of which are in their possession.
– The lessees cannot pay a land tax just now.
– Unfortunately at the present time Queensland is afflicted with a disastrous drought, but Senator Fraser must know that for years - both in full years and lean years - the pastoral ists of Queensland got their Crown lands from the Government at half the rentals that were being paid in the other States. I know that whilst the New South Wales lessees were paying l£d. per acre for land upon the borders of that State, exactly similar country was being let in Queensland for½d. per acre. I am very pleased indeed to find some free-traders supporting this item, and I think that they are logical in declaring that if the necessity arises at a later stage we can then attempt to impose a duty upon kerosene. I trust that Senator Glassey’s motion will not be successful.
– I intend to support this motion, because a tax upon kerosene will not press very heavily upon the poorer classes. People who are very poor use very little kerosene. Large establishments will probably consume ten times as much kerosene as will small establishments. Hence the tax falls upon those who are best able to bear it, which was the doctrine laid down by the last speaker upon very good authority. Perhaps the Commonwealth might get along without a tax upon kerosene, but I know that Queensland cannot. That State is in a very tight corner at the present time, and we certainly ought to render it all the assistance that we can. We have also . to consider the necessities of some of the other States. There is not much likelihood of Queensland imposing a land tax at the present time, because that State has not alienated very much Crown land - certainly not nearly so much as has South Australia. The bulk of the lands in Queensland are Crown lands. Millions of acres there are deserted, and the occupants of many more millions would desert their holdings if they could. As I am reminded by Senator Stewart, some of them are actually receiving flour by parcels post to enable them to live.
– Is not the honorable senator referring to leased lands ?
– Yes : to lands that are leased for a term of years. Very little land in Queensland has been alienated in fee simple in comparison with the area alienated in South Australia. True, it has been sold at a low price, but no price is advantageous if one cannot make a profit out of it. What is the use of my house in Toorak if I cannot let it ? If the country comes to grief by reason of non-production, what is the use of anything 1 I repeat that Queensland is in a very tight corner, and, therefore, I should like to see a duty of 3d. per gallon placed upon kerosene.
– Out of whom did Burns, Philp, and Co. make their 10 per cent.?
– Out of shipping. I was referring to land, however, and not to shipping. But other States - such as South Australia and Tasmania - besides Queensland urgently require the revenue which would be derived from a duty upon kerosene. A small family uses very little’ Kerosene as compared with a large household, and therefore the tax falls most heavily upon those who are best able to bear it. I support the motion.
– For some time past I have been watching the actions of the last speaker, and I have noticed that he has generally followed the lines of the Victorian Tariff. Upon this particular occasion, however, he has departed from them, and I think rightly so. I contend that the original proposition of the Government to impose a duty of 3d. per gallon upon kerosene was a very fair one. It is an article which free-traders and protectionistsalike must admit will produce a considerable revenue if it be made to carry a small duty. The Government proposal was a fair compromise, having regard to the way in which kerosene was treated under the former State Tariffs, and I am sorry that another place saw fit to strike it out. Kerosene is a very fair line from which to obtain revenue. Our free-trade ‘friends from New South Wales are in this happy position : that practically no matter what Tariff may be proposed that State will enjoy a surplus revenue. But they are not considerate for the smaller States. In every direction in which they can reduce revenue, they insist upon doing so. That is their policy, and their unanimity in regard to it is remarkable. In these matters they should look to the position of the smaller States. They should not ask whether a State derives any revenue from a land tax, an income tax, or even an absentee tax, of which we have heard so much. The simple question which we should ask ourselves is whether this is an article which can bear a moderate duty. I say it is. A duty on kerosene will bring in a considerable amount of revenue. From the revenue stand-point it is quite unobjectionable. I regret that some honorable senators from New South Wales are determined to keep this line up their sleeve so that if, perhaps, in a few years’ time a free-trade Government, which they are supporting, finds that the finances of the States require some little assistance they will be able to fall back upon a duty on kerosene and tea. That is a very bad policy. Honorable senators should consider the position of Queensland, Tasmania and South Australia. All those States will suffer under this Tariff if the duty on tea and kerosene is not re-imposed. South Australia will suffer very seriously. No one can sneer at that State. We have had a progressive land tax there for many years ; as well as a progressive income tax, and an absentee tax. Therefore, in the matter of taxation, I think that State is up to date. No one could improve upon the system of taxation in force in South Australia, which follows the principle laid down by Adam Smith, that a man should contribute to the cost of Government in proportion to the amount of protection he receives from it. T. contend that when we know that several of the States grant old-age pensions at the present time, and that the system will probably be adopted by all the States of the Commonwealth within the next few years, the cry about taxing the poor man is wholly a mistake. The poor man is quite willing to bear his fair share of taxation, according to the degree of protection extended by the State to his life and any little property that he may possess.
– He pays more than his fair share.
– Not in South Australia, having regard to the taxation levied on the rich.
– He pays more than his share under the import duties.
– There may be a few odd cases in which that occurs, but as a rule the poor man does not contribute more than his fair shave to the revenue. I am sorry that the duty on kerosene was remitted, and I intend to support Senator Glassey’s motion. A duty of 3d. per gallon is a reasonable one. If it is agreed to, it will assist the States which require help. I had hoped that honorable senators from the mother State, which does not require any assistance, would have supported this proposal, instead of rendering it necessary for the smaller States to increase their direct taxation. That is what we are doing in South Australia. Even if the duties on tea and kerosene are reimposed, the land and income taxes of South Australia will have to be increased, and additional stamp duties will have to be collected, while other forms of direct taxation will have to be resorted to. The reimposition of these duties will reduce the extent of increased taxation which is necessary in South Australia at the present time. I shall certainly vote for the motion.
Senator MACFARLANE (Tasmania).For once I find myself able to support a motion submitted by Senator Glassey. It is not often that I feel that I can vote to increase a duty, because as a revenue tariffist I always endeavour to reduce high imposts, and to see, as far as possible, that all round duties are levied. Kerosene is an article of universal use. We have already placed a duty upon candles, and why should we not agree to fix an impost of 3d. per gallon upon kerosene, which is also used for lighting purposes? Such an impost will not be felt by the poor. The VicePresident of the Executive Council has said that we shall obtain ample revenue under this Tariff, and if he will assist honorable senators of the Opposition to reduce the exorbitant taxation on some articles, I shall be very glad.
– The honorable senator has assisted in cutting down revenue producing items in order to obtain an excuse for voting for this proposal.
– I have voted for the reduction of only excessive duties. I shall be pleased to support the motion.
– I am rather astonished at the position taken up by Senator Macf arlane and several other honorable senators who have, complained about high duties. They have frequently asserted that 20 per cent., 15 per cent., and even 10 per cent, duties are excessive, and that as free-traders they should reduce, if not abolish, them. ‘ But Senator Macfarlane does not object to a duty equal to 33 per cent, being placed upon kerosene, because he knows very well that, notwithstanding what has been said by Senator Fraser, the wealthy people can afford to consume more kerosene than can the poorer classes, and consequently that they will pay in accordance with their incomes. Both Senator Macfarlane and Senator Fraser must recognise that for every wealthy establishment that consumes kerosene there are a dozen poor men and women who are compelled to use it, and that consequently the bulk of the revenue from this proposed duty would be drawn from the poorer classes. Reference has been made by Senator Playford to the position of South Australia, but he knows very well that the remission of the duties on tea and kerosene have had nothing to do with any deficit which may exist at the present time in the finances of the State. Do we not know that 101 things which were upon the free list in South Australia have been made dutiable under this Tariff? Is not Senator Playford aware of the fact that on cotton and piece goods alone South Australia will obtain a considerable amount of revenue, and that she has already obtained £26,000 in excess of the revenue which she would have derived under her own Customs Tariff?
– That is due to the fact that we collected the duty on tea up to the date of its remission.
– The fact that South Australia has lost revenue has no connexion whatever with the remission of the duty on tea or kerosene. Very few people in that State can complain that they are excessively burdened, by the land and income taxes in operation there Much has been made of the imposition of an absentee tax in South Australia ; but as we have derived only some 4,000 a year from that source, it will be seen at once that it means very little to the absentees, who hold an immense amount of property in South Australia. If the tax produced £20,000 a year, it would not be excessive, having regard to the protection which the State affords to the property held by these people. Senator Eraser is very much alarmed about the position of Queensland.” He need not, however, be afraid. Very little of the property in which he is so largely interested there, will suffer from the imposition of a land tax, because for the most part it is leasehold. He has endeavoured to make us believe that there is no valuable land in Queensland ; but upon the last occasion that I visited that State, I looked through the assessment books of the city of Brisbane, and found that there was an immense area of very valuable city land, which in spite of what the poor squatter has suffered, is capable of yielding a large amount of revenue under a tax on unimproved land values. The people who hold that land are charging a high ground rent for it, and consequently they should be able to bear some taxation. If they are not called upon to pay .income tax in proportion to their means, they should be compelled to do so, so that the State may be brought into line with other States which will derive a benefit from the remission of the duties on tea and kerosene. If we are not) to consider the great majority of the people in dealing with this item, to what section of the community should we give consideration? The wealthy classes, to whom Senator Eraser has referred, have not complained of this impost ; it is only the poorer classes who complain of it. For the last ten years, the repre- t sentatives of the working classes in all portions of Australia have been struggling to obtain a remission of the duties on kerosene and tea, and even Senator Playford has declared that if the country could afford it, he would be willing to remit these duties. The country will never be able to do without them, unless some compensating taxation is levied. Senator Playford has referred to the fact that in several of the States the old-age pension system has been adopted. I trust that in the near future the Common wealth will take up the question, because the States administration is very unsatisfactory. Will it not be a very satisfactory position for the Commonwealth to be in when it takes up the question to have the kerosene duty and the tea duty to fall back upon ? I am sure that if the working classes and the great majority of producers and consumers, whose interests our free-trade friends are so anxious to serve, knew that they were going to be benefited in that direction, they would have very little objection to the imposition of a duty upon kerosene, tea, beer, or anything else. Seeing that we have levied duties in so many! other directions, I hope that we shall reserve the imposition of duties of this description until such time as the Commonwealth really requires them for the purposes I have indicated. ‘ !
– I recognise that this is rather a difficult question for any honorable senator on this side to speak about, but I do not intend to shirk it for that reason. I believe that the first duty for which I have been, sent here is to have some regard for the revenue of Tasmania, and I know that the imposition of a duty upon kerosene - not necessarily a duty of 3d. per gallon - will be of material benefit to Tasmania. I find that, throughout this Tariff, while the people are being enormously taxed by duties which have been called protective, the revenue of air the States has been seriously’ diminished, and I am therefore bound, whenever an opportunity offers, to support some duty which will distinctly produce revenue. If the party on this side had succeeded in reducing a number of the protective duties, which, whatever else may be their effect, will, I am perfectly certain, make the consumers pay more for the articlesmade dutiable, I should very likely have found myself in a position to vote for free kerosene, and I should have been glad to do so. I find, however, that while the taxpayers have been heavily taxed the prospect of revenue has been diminished, and as my first duty is to preserve the revenue of my own State, I am in the most unfortunate position of having to say that I am in favour of additional taxation upon the consumer. I am extremely sorry that both the representatives of the Government are at present absent from the Chamber. Senator O’Connor has said that the Government are quite satisfied, but their satisfaction now must be entirely different from that which they enjoyed on the 8th of October when this Tariff was first introduced. What was right on the 8th of October, and what was perfectly justifiable in the Commonwealth Tariff then introduced, appears to be utterly wrong now. The Government, in introducing this Tariff, imposed a duty of 3d. per gallon upon kerosene. No doubt they thought it perfectly right and proper at that time to tax kerosene to that extent. But since then, although we have had daily und hourly remarks from the Vice-President of the Executive Council, complaining of the amount of revenue, which, he said the action of honorable senators on this side of the House was causing the Commonwealth to lose, it has become perfectly right and proper to abandon, not £2,000 or £3,000, but no less than £157,000 of revenue by the abolition of this duty. Instead of hearing the slightest expression of regret from the honorable ‘and learned senator that the States, and especially the smaller States, will have to suffer by being deprived of a very large amount of revenue which they always received under their own Tariffs, and which they were induced by the Government to believe they would receive under the Commonwealth Tariff, the VicePresident of the Executive Council, disposed of this item, which involves probably a larger amount of revenue than is involved by any other single item which we have discussed, in a speech which occupied some seconds, and not minutes. We did not hear a single word of regret at the loss of £157,000 of revenue, but we heard that this Tariff has again become something like a sacred writing and ought not to be touched. I have heard some arguments about kerosene being used chiefly by the poorer classes, and so on, but Senator Higgs used an argument which ought to induce any one to tax the article, when he said that kerosene is an article of general consumption. I have no desire to misquote the honorable senator, but if he did say that, and if the statement is correct, there is no article dealt with in this Tariff which can more fairly be a subject of taxation. If this is an article consumed by all classes in the community alike, and if we are forced here to bring into operation a big taxing machine, as I take it we are, this is the 6ne item in the Tariff from which we ought to get revenue. If there is one axiom of taxation to which we should all pay attention it is that an article which enters into universal consumption is an article which ought to bear taxation. Directly we enter upon class taxation we make a blunder, but while we confine taxation to articles of general consumption we shall be on safe ground. I am not quite sure that I should have proposed a duty of 3d. per gallon upon kerosene. While I admit that we should get a certain amount of revenue from the item, I am inclined to think that 3d. per gallon is a high duty rather than a low one. But I still intend to support the motion, even though it is moved by Senator Glassey, if I may be pardoned for saying so. I know that in this matter I shall find myself’ in strange company ; but I shall not alter my vote on that account. I know that I am leaving a great many of my own party, but it is possible that I may remain a member of the Senate for my full term of six years, and I cannot vote for free kerosene now, with a view to imposing a duty upon it later. I have beard it said by Senator Playford that the free-traders are perfectly willing now to let kerosene come in free, in order, as the honorable senator said, to have something up their sleeve. So far as I am concerned, I do not propose to vote for free kerosene, or free tea now, upon the suggested understanding that these articles are to be taxed at some future time. If there ever was a proper time, not merely to tax kerosene or tea, but to raise revenue, now is that time. We are all here rather tempted to consider especially our own States, and I can recognise a considerable amount of justification for senators from New South Wales and Western Australia refusing to vote for this duty. While I admit that frankly, I should like to appeal to them to adopt a federal spirit, to consider that Tasmania, Queensland and South Aus- 1 tralia require this duty, and to see whether they cannot sacrifice possibly their own people in order that those States may get the revenue they require. On the other hand, I admit that if they think it is their bounden duty in the matter of kerosene, and subsequently in the matter of tea, to regard the interests of their own States, I cannot blame them for supporting the free admission of these goods, because I have said, time after time, that the. people of Western Australia and New South Wales are being taxed a great deal more than is necessary. If honorable senators from those States say in this matter that they refuse to tax the people of the States from which they come, it will come with an ill grace from me or from any other honorable senator to find fault with them, and I can only appeal to them to deal with the proposed duty in a federal spirit. I am sorry the Vice-President of the Executive Council did not give me the opportunity to speak while he was present, but I do not think it is necessary to repeat what I have said now that he is here, and for the reasons I have given I shall support Senator Glassey’s motion, though I think the dutv he proposes is rather high.
– Upon this question we have seen some of the queerest coalitions with which the Senate has so far been favoured. One cannot help recollecting the statements made by honorable senators in their second reading speeches upon the Tariff Bill. For instance, we can well remember Senator Glassey saying that one of the undeniable principles of protection was to impose duties upon articles which could be produced in the country, and to admit free those which could not be produced in the country. That is laid down as one of the canons of the protectionist doctrine, and yet here is this high apostle of protection proposing the imposition of a duty upon kerosene. We know that the honorable senator has been associated for many years with a party which has always been striving to get this article placed on the free list. We know as a matter of fact that the honorable senator in the Queensland Parliament led an attack upon a duty proposed upon this article, and strongly urged that it should be placed upon the free list. The conditions in Queensland, so far as this article is concerned, have not altered since that time.
– The circumstances have greatly altered.
– If there were, reasons why kerosene should be admitted free in 1896 those reasons still exist. The reasons put forward by Senator Glassey for his objection to a tax upon kerosene were that this was an article used by a portion of the people which could least afford to pay such taxation. Does that argument not hold good to-day 1 Senator Glassey is now proposing to make up the Queensland deficit by taxing the people who can least afford to pay the proposed tax. It has been pointed out that so far Queenslaud’ has indulged in no direct taxation. If Queensland wishes to wipe out her deficit she can quickly do so. The unimproved value of the alienated land of that State is £34,294,000, and a tax of Id. per £1 upon that amount would realize £142,000 per annum, which is more than the State’s actual deficiency. Those of Senator Glassey’s constituents, who heard him speak against the kerosene duty in 1S96, will require a great deal of explanation from him before they will condone his present action. But, while I speak thus about the action of protectionists in supporting the motion, I think the free-traders who intend to vote for it are even more to be blamed. A protectionist might argue that the duty should be imposed in order to encourage the production of kerosene within the Commonwealth, but how can a free-trader defend the imposition of this duty 1 Senator Clemons, when speaking upon the second reading of the Customs Tariff Bill, said that he hated the system of levying taxation through the Customs-house, because it pressed unjustly upon the community, inasmuch as the poor nian had to pay as much upon certain articles as the rich man, though the means at his disposal for acquiring them were nothing like so great.
– Still, we must haveCustoms taxation. My hands are tied in this matter, and so are those of the honorable senator.
– Senator Clemons did not consider that his hands were tied when he moved the remission of the duty upon lubricating oil.
– I did so to remove a hindrance to industry.
– Kerosene is just as largely used by the various industries of the Commonwealth as is lubricating oil. Moreover, kerosene is used very largely by the poorer classes of the community, whereas lubricating oil is used by the manufacturers, . who, for their buildings, machinery, and other property, require a hundred times as much protection as do the workers who have to depend upon their labour for their support. The best example of the benefits of free-trade which has yet been afforded to Victorians was given to them when the placards in the grocers’ windows throughout the State announced that, in consequence of the remission of the duty upon tea, the price of that article had been reduced by 3d. per lb. The sight of those placards converted more protectionists than even the right honorable member for East Sydney will do in his present campaign. I have always endeavoured to be a consistent free-trader. I believe that a very large amount of revenue would be obtained from a duty upon kerosene, but I object to the imposition of a duty upon that article, because it is used more by the poor than by the rich. South Australia endeavoured to so adjust her taxation that her citizens should pay in proportion to the protection they received from the State, and I am, therefore, surprised that Senator Playford intends to vote for a duty upon kerosene. Under the Federal Tariff South Australia has already received more than she would have received under her State Tariff, and the Treasurer has told us that the Commonwealth Tariff will yield more revenue in a normal year than has been obtained from it during the year which has just passed.
– South Australia received more revenue .because of the duties upon tea and kerosene.
– I do not think that those duties were in force for a sufficiently long period of time to make much difference. The deficiency in South Australia has been caused, not by the Federal Tariff, but by the decline iri the Barrier trade, and by other circumstances. I appeal to protectionists not to .tax an article which cannot be produced in any quantity within the Commonwealth, and I appeal to freetraders not to vote for a revenue tax which will press unequally upon the community.
– As a free-trader I agree with Senator Pearce that it is impossible for any one who wishes to deal logically with this question to vote for the motion. The Treasurer estimated in October last that the Federal Tariff would yield about £8,000, 000. It actually returned however, nearly £9,000,000, not taking into account about £1,000,000 which was lost by the reductions in duties made in the other House. 40 x
He also told us, in October, that in a normal year the Tariff might be expected to yield £1,000,000 more than in the year which has just passed; that is to say, he estimated the revenue for a normal year at about £9,000,000. I do not say that the revenue next year will be £2,000,000 in excess of that amount, though I should have some justification for doing so : but, taking the Treasurer’s own figures, it cannot fall below £10,000,000 ; and, that being so, I fail to see the need for a duty upon kerosene.
– What does the total matter ? The only thing that matters is where the money goes to.
– - It does not matter entirely where the money goes to, though that is of a great deal of importance. The question for us to consider is to what extent should we impose unnecessary taxation upon four States in order to make up deficiencies in the revenue of the other two. To impose upon the Commonwealth a Tariff which would meet the deficiencies of all the States would be to make the position of the taxpayer unbearable.
– The honorable senator speaks as a representative of Western Australia, the State which was afraid to come into the Union upon equal terms with the others.
– We had an autocrat in power when federation was entered upon, and he demanded certain terms. The people of Western Australia had practically no voice in the matter, and if they had their desire the Inter-State duties would be swept away immediately. While Queensland and Tasmania may be in a necessitous condition, South Australia has received from the Commonwealth Tariff more than she would have obtained from her own Tariff.
– Yes, about £30,000 this year, but that will not happen next year.
– The honorable senator has not proved that assertion. I find on reference to the returns with which we have been furnished that the Customs revenue in South Australia last year amounted to £697,000. This amount is apparently made up of £177,000 which was collected under the State Tariff prior to the 8th October, of £308,000 collected during the next six months up to the end of March, and of £211,000 which must have been collected during the last quarter, when there was no duty upon either tea or kerosene.I feel certain, therefore, that Senator Playford has very much under-estimated the South Australian Customs revenue for the future.
– But was not the total for last year less than that for the previous year?
SenatorMATHESON.- No. The amount collected exceeded by £35,000 the Customs receipts for the previous year under the State Tariff. Therefore, so far as Customs revenue is concerned, the position of South Australia seems quite as promising as, if not better than, that of some of the other States which are receiving surpluses. The position of Queensland is undoubtedly very bad. Last year they received less by £195,000 than during the previous year ; but the deficiency is to a very large extent due to causes in no way connected with the Federal Tariff. The Customs revenue of Queensland has been decreasing for the last two years at the rate of £50,000 per half-year, or £100,000 per annum. Therefore, only £95,000 of the deficiency can be attributed to the operation of the Federal Tariff. We cannot possibly be expected to make good a deficiency of that sort, when the other States are receiving back mere than they had any reason to expect. With the exception of Queensland, all the States have received a considerable amount of revenue in excess of the three-fourths to which they are entitled under the Constitution.
– The honorable senator is not including Tasmania in his statement.
– Yes. Tasmania received more than the three-fourths of the Customs revenue to which she was entitled after deducting expenses. Tasmania was entitled to receive back only £276,000, but she has had returned to her £315,000, or £39,500 more than need have been paid if the Tariff were based simply upon the necessities of the Commonwealth. She has a deficiency compared with the Customs revenue of 1900, but the shortage is very small. If we are to be called upon to make good the deficiencies in the Customs revenue of some of the States, we shall have to collect hundreds of thousands of pounds more than would otherwise be necessary in the States which already have an excess. The desire of the free-trade party is to reduce all unnecessarily high customs duties, partly with a view to increasing the revenue, and partly in order to prevent undue taxation being imposed upon the people for the benefit of manufacturers. I think, therefore, that I am following out the precepts of that party when I decline to support Senator Glassey’s amendment.
– I should like Senator Glassey to withdraw his amendment, in order to allow me to move the postponement of the consideration of the kerosene duty.
– That would not be in order. It would not be possible to postpone the consideration of the duty upon kerosene, because we have already dealt with and altered the item of which it forms a part.
– Do I understand the Chairman to rule that it is not competent for Senator Neild - even if Senator Glassey withdraws his amendment - to move the postponement of the kerosene duty ?
– Yes, that is my ruling.
– May I refer you to the course which was adopted in connexion with the duty upon oilmen’s stores ? A long discussion took place, and an amendment had been moved, but the further consideration of the item was subsequently postponed.
– I would point out that the proposed duty upon kerosene stands as a separate line, and that it would be quite competent for us to postpone its consideration if the amendment were withdrawn.
– The position is quite clear. Item 84 must be treated as one clause, and we have practically passed what amounts to an amendment. The item may be discussed all night, and then the whole of it may be postponed ; but the suggestion of Senator Neild is that the consideration of a portion of the item should be postponed, and that cannot be done.
– Senator Glassey bases his argument in favour of a duty upon kerosene upon the necessitous condition of Queensland. I do not know that that is altogether a good argument.
– The Queensland revenue was larger last year than in the previous year, when a duty upon kerosene was being collected.
– The necessitous condition of Queensland has arisen owing to the drought. Yet I do not think Senator Glassey supported the abolition of the fodder duties in order to mitigate the effects of the drought. I do not see that we are called upon to impose a duty upon kerosene, because that State is in need of revenue. A duty upon kerosene is what the Cobdenite free-trader would call a freetrade impost, inasmuch as that commodity is not manufactured within the Commonwealth, except at two factories in New South Wales. As a free-trader, therefore, I should be very strongly disposed to support an impost upon kerosene as a purely revenue duty. On the other hand,I find myself in this position : Senator Glassey has given his loyal and consistent support to the Government in imposing a number of duties, which I do not think are necessary, and, in view of the fact that the Tariff as it stands is, according to the Vice-President of the Executive Council, yielding a larger revenue than is required to meet the necessities of Government, I see no reason why we should impose extra burdens upon the people, by placing a duty upon kerosene.
– I did not say what the honorable senator represents.
– The VicePresident of the Executive Council claimed that the Tariff, as originally introduced, was intended to provide a revenue of £8,000,000. In his second-reading speech he said the Tariff, as it left the House of Representatives, would produce a revenue of £8,500,000. He told us this afternoon that it was realizing very much more. I have been unsuccessful in reducing many of the charges upon the people which Senator Glassey has supported, and yet the honorable senator asks me to vote for a proposal to impose further taxation to the extent of £150,000 per annum. If I could remove or reduce some of the duties already passed, I should willingly support a duty upon kerosene ; but, as a free-trader, I find myself compelled to vote against a free-trade duty, because I cannot conscientiously burden the people with further undue taxation. That is precisely my position. If I had any assurance that the remaining items upon the Tariff would be reduced by £150,000, I should certainly vote for the motion. In the absence of such an assurance, however, I regret that, in the interests of the taxpayers, I am obliged to vote against a proposal, with which otherwise I am entirely in accord.
– The question of revenue is a very grave one to Tasmania - far more grave than honorable senators imagine. I do not think that it matters very much to the necessitous States what amount the Tariff produces in the aggregate - although that is a very important factor to consider - but it does matter very materially whether a sufficient revenue is returned to them from the Customs to enable them to pay their way. I am quite satisfied that scarcely any member of this committee, beyond the senators from Tasmania, really understands the absolute necessity which exists that that State should derive as much re venue aspossible through theCustoms. When theFederal Tariff first came into operation, Tasmania was receiving about £30,000 a month from, thatsource. In May, however, theamount fell to £24,000, and last month the total collections did not quite reach £22,000. Honorable senators, therefore, will understand that that State is suffering from an enormous shortage, as compared with the revenue which it previously received. Under this Tariff there are three States which will derive more Customs revenue than they formerly received. New South Wales, will gain £859,000; Western Australia, £347,000 ; and South Australia, £26,000 ; whilst Victoria will lose £209,000; Queensland, £202,000 ; and Tasmania, £96,000.
– Has the honorable and learned senator checked those figures ?
-The figures are taken from the Treasurer’s statement.
– They are taken from the newspapers, and I do not think that they are accurate.
– At all events, the fact remains that two States will gain enormously under this Tariff, whilst three will experience a shortage of revenue. In reference to Tasmania, I may add that the estimated shortage of £96,000 is entirely misleading, because I am assured by the Tasmanian Treasurer, who ought to know, that compared with the revenue for 1900, the shortage of that State for the past six months, together with that for the current half-year, will be about £163,000. That shortage to Tasmania is equivalent to a loss of about £1,750,000 to New South Wales, £1,250,000 to Victoria, and £800,000 to Queensland. I should like to ask Senator Pulsford, and other free-trade senators from New South Wales, what their feelings would be if they thought that the Tariff, in the adjustment of which we are occupying so many months, was going to yield to that State £1,750,000 less than it received prior to federation. That is the problem with which the Tasmanian senators are faced, and I deprecate altogether the criticisms indulged in by labour representatives who are so fond of talking about imposing a land tax and an income tax. I would further point out that this loss of revenue to Tasmania occurs at a time when the State Legislature has already imposed upon the people all the direct taxation “which they can reasonably bear. I well remember levying an income tax in Tasmania in 1893, and I know of several large funds which were immediately sent away from that State, with the result that thousands of pounds would have been lost to the revenue but for the fact that the Parliament of New South Wales - to which State these funds were being sent - also imposed an income tax just about that period. I can assure the committee that if an income tax of ls. per £ is imposed in Tasmania no money will be kept in that State. Some honorable senators think it is very easy to impose a land tax, but I remember that some four or five years ago the price of produce was so low that it would have been absolutely cruel to increase the land tax of id. in the £ which existed in Tasmania. I attempted to do so and doubled the tax, but I never regretted anything more in my life. The increased tax remained in operation for one year only, when it had to be taken off. What is the right thing for us to do 1 We know that New South Wales, when she entered the Federation, was fully aware that she would have a very large surplus of revenue. But the position has now entirely changed, find I venture to say that New South Wales requires almost every shilling of her increased revenue on account of past extravagance. If any State does not require all the revenue -which it will derive from customs duties it can surely increase its sinking fund for the purpose of paying off its indebtedness. To my mind this is a very serious matter, and I am rather disappointed to find the members of the labour party taking up the position that we must not tax kerosene or tea, because they desire to give the working classes a free breakfast table. That fact demonstrates the evil of honorable senators being returned to this Parliament in the interests of a particular class. That is not the kind of Government which will ever make the Commonwealth prosper. If it can be proved to the satisfaction of my friends of the labour party - as it will be - that three States absolutely require more revenue, I hold that the only statesmanlike course for them to adopt is to cease thinking about classes, and to consider the Commonwealth to the extent of helping us to impose such taxation as is fair in its incidence, and will, at the same time, produce the necessary revenue. Is the proposed duty upon kerosene a fair one ? Most certainly it is. New South Wales is twelve times richer in every way than is Tasmania, so that for every £1 which the latter has to lose the former could afford to lose £12, and still have the best of the bargain. Tasmania has a large portion of her national debt invested in non-paying railways. Her population is small, the traffic upon her. railways is proportionately small, and £4,000,000 of her national indebtedness returns only about 1 per cent, instead of the 3-Jr and 4 per cent, which is received in the other States.
– Were some of those political railways ? i
– Very few of them were political railways. They were constructed as the result of agitation in the particular portions of the country which they would serve, and were not so carefully scrutinized as they should have been. It is my bounden duty to vote in favour of maintaining the revenue. I am perfectly certain that before we are very much older this financial problem must be faced, and that something must be done, either by the necessitous States, or by ‘this Parliament. We shall then be called upon to exercise, not our prejudices in. favour of a class, but such statesmanlike qualities as we may possess.
– When I was contesting the federal election, one of the pledges which I gave to the people of South Australia was that I would endeavour to insure the return to that State, under the Commonwealth Tariff, of a revenue equal to that which it had previously received through the Customs. In 1897, when the Federal Convention sat, we were assured that £6,000,000 would be sufficient to meet the requirements of the Commonwealth. When we came to seek election, however, we were informed that the needs of the various States would amount to £8,000,000 - an estimate which a good many of us regarded as an extravagant one. What has been the result ? Notwithstanding the reductions which have been made in the duties as originally proposed, we find that the Tariff still produces an amount in excess of the Treasurer’s estimate. The Government still have more money than they asked for when they introduced the Tariff, despite the remission of the duties upon tea and kerosene. I am aware that, for the greater portion of last year those duties were operative. In South Australia, however, the duty collected upon kerosene ‘represented only about £15,000 a year. Now that State finds that it will have a revenue of £26,000 or £30,000 a year in- excess of the amount which it previously received.
– If we deduct the amount raised by the duty -on tea nothing is left of the surplus.
– I am coining to that. For these reasons I feel that I shall be on solid ground in voting against the reimposition of the duty on kerosene. But unless the duty on tea is re-imposed I am afraid that South Australia will not obtain the same amount of revenue that she collected prior to federation, and therefore I shall be prepared to vote for its restoration. I do not think it is wise to give too much money to any Government ; it is always well to keep a Government as poor as possible, for my parliamentary experience, extending over twelve years, has led me to believe that the more money that a Government obtains the more it is , likely, wisely or unwisely, to spend. Honorable senators from Queensland and Tasmania have appealed to us to remember the position of those States, which, they assert, will have a very large deficit, but is it right to impose unnecessary burdens upon 3,250,000 of people in order that 500,000 may obtain sufficient revenue through the Customs to satisfy their requirements t
– Then why re-impose the duty upon tea 1
– Because it will be necessary in order to obtain sufficient revenue to keep the finances of the States in the position which they occupied prior to federation. I am sure that the great mass of the people are willing to pay a fair contribution to the cost of government ; but under this Tariff we are taxing many articles which have hitherto been free in South Australia. A duty of 15 percent. is imposed on flannelettes which were free in that State, whilst all cotton goods, which were exempt under the South Australian Tariff, are now taxed. I do not think it is wise to impose too severe a burden upon the people, and if the Commonwealth collects a revenue of £8,000,000 - an amount much larger than was estimated at the Federal Convention - the Federal Treasurer will have sufficient funds at his disposal to make good any deficiency that might occur in the revenue of Queensland or Tasmania. I think it is wise that we should allow kerosene to remain free, at all events, until wediscover the requirements of the various States. We do not know what the Tariff” will yield.
– £10,000,000 perannum.
– The estimates vary very considerably. We should not knowingly impose upon the people burdens that are not absolutely necessary to meet the requirements of the States. Out of theonefourth of the total revenue which theFederal Treasurer will retain, the Commonwealth will be able to make good any deficiency in the customs and excise revenue of any of the States.
– I am delighted to find that the whip of the freetrade Opposition is rapidly being converted to the one true fiscal faith. The free-trade, or revenue party, as they prefer to be called, are continually telling us that low duties increase revenue, and I propose to show howinconsistent they are. The whip of thefreetrade Opposition has intimated that he intends to support the proposed impositionof a duty of 3d. per gallon on kerosene. I ‘ am pleased to find him supporting such a- . staunch protectionist as Senator Glassey; if the proposed duty were a protective one, all honorable senators on this side would support its imposition. According to Coghlan, the value per gallon of the whole of the kerosene imported into New South Wales in 1899 was 9-34d. A duty of 3d. per gallon upon that value would be equal to 32 per cent. The value of kerosene imported into Queensland during the same year was 9”18d. per gallon ; a duty of 3d. per gallon upon that would be equal to 32i per cent.; and the value of the kerosene imported into Tasmania in 1899 was 8”35d. per gallon, so that the duty in that case would be equal to 36 per cent. The value of the kerosene imported into Victoria during the same year was 7-70d. per gallon, and the duty on that value would be equal to 39 per cent. The Value of the kerosene imported into Western Australia during the year named was 7-23d. In that case a duty of 3d. per gallon would be equal to 41 per cent., while the value of the kerosene imported into South Australia during 1S99 was 7-20d. ; so that the duty of 3d. per gallon would be equal to 41 J per cent. Yet this duty is supported by honorable senators who are continually telling us that that any duty over 5 per cent, is too high. Senator Ewing twitted me last night “with being a “ 30-percenter.”
– A “ 300-percenter.”
– Now the honorable and learned senator proposes to support a duty which would be equal to 32 per cent, on the highest values of kerosene imported during 1899. This is not a protective, but a. revenue duty. If it were a protective duty I should not be ashamed to vote for it, even if it amounted to 300 per cent. Senator Ewing talked largely about the farming interests a few days ago, and moved that the duty of 15 per cent, upon farming implements should be reduced to 7£ per cent, in the interests of “ the poor farmer.” The poor farmer buys one machine, perhaps, in .10 years; but he buys kerosene every week, and upon that commodity the honorable and learned senator would impose a duty of 30 or 40 per cent. There is another aspect of this proposal to which I should like to call attention. There is no duty on coal, and it is right that it should be free. But, while the big gas companies in the large towns are to be permitted to obtain their material free of duty, the little companies in country townships who make gas from kerosene are to be called upon to pay a duty of 3d. per gallon. That is rather an inconsistent proposal on the part of those honorable members of the Opposition who support the motion. If the Government had proposed to give a bonus for the production of kerosene in Australia, I should have given it my warmest support. I regret very much that no such proposition has been made. Illimitable quantities of kerosene shale are to be found in New South Wales. Companies there raise kerosene shale not only for export purposes, but for the local manufacture of petroleum and other products. From 1865 - when the kerosene shale mines were first opened up in that State - to the end of 1899, the quantity of kerosene shale raised amounted to 995,832 tons, valued at £1,908,482. In 1899 36,719 tons were raised, of which 19,355 were exported, the balance being worked up into merchantable products in New South Wales. According to this evening’s Herald, the Standard Oil Trust of America is building no less than twelve steamers for the conveyance of oil to Australia, in order that they may compete with, and, if possible, oust the very wealthy Shell Transport and Trading Company, which is now trading here. For a few months that will be a capital arrangement for the consumers. Whilst these two companies are competing with each other, the people will probably obtain kerosene for a merely nominal sum, but ultimately the two companies will combine, and kerosene will be sold at double the price now asked for it.
-What about the Vacuum Oil Company’s mines in Russia?
– No doubt that company will join the trust just as various shipping companies have joined the huge shipping trust. . The sooner the Government undertakes to encourage the manufacture and production of kerosene within the Commonwealth, so that Australia may be self-contained in this respect, the better it will be for the consumer. I believe that a majority in both Houses would support a proposal, to impose a fair duty on kerosene and a bonus substantial enough to encourage capitalists to enter upon the production of kerosene oil in large quantities. It would be a gigantic thing, because not only will kerosene furnish light for hundreds of thousands of people in the Commonwealth, but it is the coming fuel for machinery. I can well understand the action of our free-trade friends in New South Wales in this matter, and I can also understand why that State has never produced large quantities of kerosene, although there are illimitable deposits of shale there. There is no doubt that the coal industry is. so powerful in New South Wales as to be able to block all efforts in the direction of developing the kerosene industry. We shall find a -number of free-traders voting for this enormous duty upon kerosene, and we shall have the list in Ilansard. That is one reason, and I do not disguise it, why I took the trouble to ascertain the price of kerosene in each of the States. We shall have the names of these honorable senators in Hansard, and when they begin again to talk about enormous duties of 20 and 25 per cent., we shall be able to refer them to this enormous duty upon kerosene, for which they have voted. Our young and eloquent friend from Western Australia, Senator Ewing, has made many harangues attacking protectionists outside and inside this Parliament for supporting 15 per cent, duties. The honorable and learned senator never uses any argument, but what he does is to make himself very disagreeable to older men than himself. He has declared that 10 percent, duties should be swept away as burdens upon the people. He has said that we require revenue, and that we may get it by duties of 2£ per cent. ; but he is now no doubt prepared to vote for a duty of 3d. per gallon, upon kerosene, which is equivalent to a duty of 41 -J- per cent, ad valorem.
– The honorable and learned senator is going to vote for free kerosene.
– The honorable and learned senator is going to vote against every protective duty, no matter how big or how little it may be.
– That is at least consistent.
– I think the honorable and learned senator is absolutely inconsistent. He will vote for this motion at the same time telling us that we must have revenue, and that we can raise all the revenue we require hy a duty of 2- percent, upon condensed milk, top hats, and importations of that description. In all seriousness, I say that I wish the Government would take into consideration the desirability of offering a bonus for the production of kerosene within the Commonwealth, in order that we may be prepared for the huge combination which is foreshadowed in the Harold cablegram to which I have referred.
– I am sorry that I should have proved so objectionable to Senator Styles ; I had thought that we were very good friends. I do not know whether it is my free-trade principles that have annoyed the honorable senator, but I believe I have been very consistent in the action I have taken in this Chamber, and I intend to remain consistent to the end. My endeavour in our consideration of the Tariff has been to remove from the shoulders of the great masses of the people all the impositions I possibly can. I recognise that kerosene is an article used in the back-blocks of Australia, in localities which are not fortunate enough to enjoy gas or electric light, and it is therefore mainifest that a duty upon the article will be a tax upon a large section of the community. Turning to the revenue aspect of the question, which is really the only one worthy of consideration, I think it will be admitted that, with the exception of New South Wales, all the States expected to lose revenue under federation. According to the figures put forward in Western Australia by opponents of federation, that State was to lose at least £300,000 a year. But revenue has, so far, been lost by only two States. Senator Charleston fears that if duties are not imposed upon kerosene and tea, there will be a deficit in the Customs revenue of South Australia ; but the figures show conclusively that there will not. South. Australia to date is in credit £26,000. My information is that the revenue collected upon tea was £13,730, and the revenue collected from oils of all kinds was £9,000 ; and therefore, if we leave out the revenue derived from tea and kerosene, the balance to the credit of South Australia will still be £6,000. Those are the figures before me, and honorable senators can correct them if they think they are wrong. Senator Dobson’s contention was that no matter whether the Commonwealth requires money or does not, it is our duty to raise enough revenue to prevent any State from losing any.
– That ought’ to be our aim.
– I entirely differ from Senator Clemons upon that point. J say that our aim should be to raise sufficient revenue to meet the financial exigencies of the Commonwealth, and we do not undertake to return to every State the full amount of revenue that State received in the past. Assuming that Senator Dobson’s statement is correct and that the deficit in Tasmania is £163,000, to return to that State the whole amount of revenue she previously received, we should have to raise over £13,000,000 through the Customs.
– That cannot be done ; I do not argue that it should.
– No, it depends en,tirely upon how it is proposed to raise it.
– One honorable and learned senator from Tasmania says that it is necessary to do that, and another says that, it is not. But I take Senator Dobson’s argument, if it means anything, to mean that the Commonwealth should raise more revenue than it requires in order to meet the exigencies of the smaller States. It is admitted on all hands that we have more revenue than the Commonwealth requires.
– We have less revenue than three of the States require.
– That is just the point. It is admitted on all hands that we have more revenue than the Commonwealth requires at the present time, without the duty upon either tea or kerosene. It is manifest that we cannot by the imposition of duties cure the discrepancies which exist between the States in connexion with revenue, and it must be a matter of adjustment. If Tasmania is in a dangerous financial position, the best thing for the Commonwealth to do is not to raise £4,000,000 from the pockets of the people unnecessarily, to put Tasmania’s finances right, but to give that State the money necessary for that purpose. I would rather do that. Tasmania must either bring her expenditure within her revenue, or she must accept a gift from the Commonwealth.
– She will not do that.
– The only other solution of the difficulty is for the Commonwealth Parliament to extort from the people £4,000,000 more than is required for the purposes of government. Senator Dobson has told us that Tasmania will have a deficiency of £163,000, but the amount of revenue which would be raised in Tasmania from the proposed duty upon kerosene would be only £3,000 per annum.
– Between £4,000 and £5,000 per annum.
– Well, even £4,000 per annum would go but a very little way towards getting rid of a deficiency of £163,000. As a free-trader, I -have endeavoured to reduce the taxation borne by the people. Throughout the considerationof the Tariff the free-trade party have been trying to reduce the duties upon clothing and other necessaries of life, and why should we now vote for a duty upon an article like kerosene, which is so largely used by the poorer classes ? It is not proposed to levy a tax upon electric light or upon gas, whichare the illuminants chiefly used, in the towns ; why then should the people who live in the country be specially taxed for their light? I shall oppose the motion, because I think that we have no right to unnecessarily increase the taxation of the people.
-.! cannot support the motion. I am as sensible as is Senator Glassey of the difficulties of Queensland in regard to revenue, and I regret very much that that State is in. so unfortunate a position. One of the reasons why .1 cannot support the imposition of a duty upon kerosene is that at the present time a very large number of the citizens of the State are either out of employment or are earning only very small wages. This seems to me a time when we should decrease, rather than increase, the large burden of indirect taxation which they have to bear. I am opposed to the proposed duty, because I think it is time that an attempt was made throughout the Commonwealth to equalize the ratio of direct to indirect taxation. I listened very attentively to the fervent appeal made by Senator Dobson to the members of the party to which I belong, not to compel the States to impose more direct taxation. He told us that Tasmania is in a very bad way, and that everything possible should be done to relieve her of her difficulties. I agree with Senator Ewing, however, that if Tasmania is to have a deficiency of £163,000 this year, the £4,000 which the proposed duty would return to her would not afford her much relief. I find that the direct taxation in Tasmania is only 12 per cent, of the whole. Let Senator Dobson contrast that state of affairs with the condition, of things which prevails in New South Wales, where the direct taxation is 35 per cent., and the indirect taxation 65 per cent. I find, moreover, that in Tasmania the indirect taxation has been increasing, while the direct taxation has been decreasing. In 1881 the direct taxation there was equivalent to lis. 5d. a head, and the indirect to £2 8s. 6d. per head, the total taxation being £2 19s. lid. per head ; whereas in 1900 the direct taxation was 7s. 8d. per head, the indirect taxation £2 13s. 3d. per head, and the total taxation £3 0s. lid. per head. So that during the last 20 years the property owners of Tasmania have been slowly but surely casting their burdens upon the shoulders of the people. There is a company in Tasmania called the Van Diemen’s Land Company which holds 2S7,250 acres of land there. That land was valued at £31,755, or at 2s. Gd. an acre, and paid land tax to the amount of £65. The Government increased the valuation of the property to £153,000, and the taxes then paid came to £318 15s. The company appealed against that valuation, and it was reduced to £86,000, or about Ss. an acre, upon which the company have to pay a tax of £182 is. 2d. I am certain that they could get £300,000 to-morrow for the estate if they put it upon the market. If the land were cut up, and 1,000 acres given to each family, 287 families could be settled upon it, and they would contribute under the present Tariff about £3,000 per annum to the revenue. Kerosene is an article which is used in almost every bush home throughout the Commonwealth. It is used for lighting, for cooking, and for many other purposes. No other article of commerce is more extensively used, or more valuable to the great body of our producers, than is kerosene. It has been pointed out that gas and electric light, which is used in the cities and towns, is not taxed ; why, therefore, should the country people be taxed upon themeans of lighting which they use ? This proposal recalls the old window tax in England.
– And the 20 per cent, duty on candles in the Tariff.
– We have any quantity of tallow in Australia, and can produce our own candles. If we could produce kerosene, .1 would support a protective duty upon it, because I am anxious that Australia should, in regard to everything that she uses, be independent of the trusts which are growing up everywhere throughout the world. In Queensland the direct taxation per head is 13s. 3d., and the indirect taxation £3 9s. Id., there being 15 per cent, of direct taxation, and 85 per cent, of indirect taxation. For these “reasons I very much regret that I shall be unable to support Senator Glassey’s motion. I am just as anxious as is that honorable senator regarding the finances of Queensland ; but I desire to see other methods of raising revenue resorted to. I trust that the Queensland, Tasmanian, and South Australian Governments will levy taxes upon land and wealth generally rather than rely upon customs duties upon articles of general consumption.
– - I intend to oppose Senator Glassey’s motion, because I regard a duty upon kerosene as a class tax.
– No one has preached to us against class taxation more than has Senator Dobson, and yet he is supporting the imposition of a duty upon kerosene, which is distinctly a class impost. In every big city or town in Australia either the electric light or gas is used by the better classes, and kerosene is essentially a poor man’s illuminant. Some honorable senators have appealed to us to admit lubricating oil free on the ground that a duty upon that article would impose a considerable burden, but there is a very great difference between the class of consumers who use lubricants and those who employ oil for illuminative purposes. I am very glad that Senator Glassey moved his motion, because it has afforded us an opportunity of testing the genuineness of the professions of certain honorable senators who have declaimed against the imposition of too much taxation upon the poorer classes. We are now in a position to judge how far they are prepared to go in relieving the poor of their burdens. Some members of the freetrade party, who have shown themselves anxious to remove revenue-producing duties which would not impose any serious burdens upon the general body of the people, are now to be found supporting a duty upon kerosene, which, it is admitted, will press heavily upon the poorer classes. Senator Clemons supports the duty on the ground that it will furnish Tasmania with a portion of the revenue of which she stands in need ; but the honorable senator should have had more regard for the necessities of his State when he voted for the reduction of the duty upon ale and stout. I cheerfully admit that my action may seem to be somewhat inconsistent, because I voted against the free admission of lubricating oil. I recognised then, and I recognise now, that it is quite possible that we may manufacture kerosene as well as lubricating oil in Tasmania, and I hope we shall ; but I would point out that there is a. vast difference between the two items. The leader of the party to which I belong put the case in a nutshell when he said that in the very near future an attempt must be made to establish a system of federal old-age pensions. We shall then find it to our advantage if we are able to resort to the taxation of such commodities as kerosene and tea for the purpose of raising a portion of the money required. If we now impose a duty upon kerosene, we may have to adopt other and perhaps less desirable methods.
– Much of what I intended to say has been already stated by my honorable colleague, Senator O’Keefe. I do not intend to support Senator Glassey’s motion. I do not regard the duty now proposed as of a protective character, and I feel certain that if it were intended to have a protective incidence, some honorable senators who have expressed their intention to support it would vote in an opposite direction. It has been pointed out that the revenue that would be derived from a duty on kerosene would be of considerable importance to the States of South Australia, Tasmania, and Queensland, and speculations have been indulged in as to the exact amount of revenue that would be received by Tasmania. The last volume of the Tasmanian statistics shows the operation of the duty of 6d. per gallon upon kerosene during 1900. In that year 333,892 gallons of kerosene were imported, and the duty at 6d. per gallon amounted to £8,347 6s. Assuming that the quantity of kerosene consumed during next year was not greater than in 1900, a duty of 3d. per gallon would yield about -£4, 175. I think we are entitled to assume that the consumption of kerosene will not increase. Probably the great bulk of the kerosene used for lighting purposes is consumed outside of the cities, and we know that during the last two or three Tears a considerable impetus has been given to the use of lighting agencies other than kerosene in inland centres of population. In one inland town in Tasmania, in which until recently kerosene was used by nearly everybody, tenders have been within the last few days accepted for the installation of an electric lighting plant, whilst in other places acetyline gas and gases of other kinds arc being used for illuminating purposes. Within a verv short time kerosene as an illuminant will be used only by the unfortunate primary producers regarding whose interests some honorable senators opposite have repeatedly professed to be solicitous. Senator Dobson has made reference to what he believes will be the actual deficit in Tasmania caused by the operation of the Tariff, and lias mentioned the State Treasurer as his authority. I should like to know when it was that that gentleman gave his forecast.
– Three or four days ago ; I telegraphed to him.
– I notice that the Treasurer of Tasmania has supplied some of the newspapers of that State with information regarding the result of the operation of the Tariff during the past half-year. Yet, although Tasmania has collected £168,000 in customs and excise duties during that period, and the revenue from the Post and Telegraph department was £44,000, he acknowledges having received from the Commonwealth Treasurer only £124,000. Surely the actual cost of collecting £16S,000 from customs and excise would not amount to more than a few thousand pounds.
– But there is a loss upon the Tasmanian Postal department.
– I do not know that there is a very big loss.
– It amounts to nearly £20,000.
– I am speaking more particularly of the actual amount returned to the State Treasurer. He acknowledges having received £124,000. Surely the cost of collection and the postal deficit would not reduce the total amount from £168,000 to”£124,000.
– Then there are the expenses connected ‘ with the Commonwealth.
– Quite so; but there are other amounts yet to come in representing something like £12,000 for the half-year - amounts which have not been accounted for by the State Treasurer, and which are payable in respect of goods imported into other States and re-exported to Tasmania, and for which Tasmania will necessarily receive credit in the adjustment of the accounts. For these reasons I cannot support Senator Glassey’s motion. I do not think that the sum which the imposition of a duty of 3d. per gallon upon kerosene would return to Tasmania during next year, or succeeding years, is of sufficient magnitude to warrant me in departing from one principle “which I laid down when appealing to the electors. Assuming that the consumption of kerosene in 1902 is no greater than it was in 1900, the duty of 3d. would rectum to Tasmania less than £4,200.
– Would £10,000 or £15,000 be of sufficient magnitude?
– If £10,000 or £15,000 were involved I should then be prepared to discuss that matter. But the amount which would be returned to Tasmania under the proposed duty is not of sufficient magnitude to warrant me in abandoning the principle I have referred to of refusing to impose duties upon goods for the supply of which we are necessarily dependent upon outside countries, and which are, practically speaking, exclusively used as a necessary of life by only a certain portion of the community. I think it can fairly be said that kerosene is a necessary of life, but to only a certain section of the people. In this connexion I have received letters from country residents drawing attention to the fact that a duty upon kerosene presses exclusively upon persons living in those portions of the country where the population is not sufficiently large to warrant the adoption of some lighting scheme of a corporate character. For these reasons I cannot support the motion.
Senator GLASSEY (Queensland). - I very much regret that Senator Keating cannot see his way clear to support my proposal, especially as the finances of Tasmania are in anything but a flourishing condition. It has been said that a duty upon kerosene would constitute a special tax, and some honorable senators have implied that I am anxious to specially penalize the poor of the community. I yield to no one in my desire to lighten the burdens of the people or in my sympathy with the poor. I never did believe in a tax upon kerosene, and I do not believe in it now. It is with very great reluctance that I submit this motion, but I do so from a sense of duty. Senator Pearce, for whom I have the greatest respect, has endeavoured to show that I am inconsistent in adopting this course, inasmuch as I stated, when speaking upon the Address in Reply, that I was anxious to tax articles which could be produced within the Commonwealth. That is a sound protectionist principle, and one to which I have endeavoured to adhere wherever practicable. But in order to raise the revenue requisite for carrying on the Government of the country, we have already found it necessary to tax a variety of articles which can be produced locally. Senator Pearce also pointed out that very little direct taxation had been imposed in Queensland, and declared that until that system of raising revenue was resorted to, it would be unfair to tax such an article as kerosene. Are honorable senators aware that in Queensland we have a dividend tax, which returns a sum of £66,000 annually ? Certainly an income tax would yield considerably less than that amount. Senator Pearce spoke as if the imposition of a land tax, an income tax, and an absentee tax, would return a revenue sufficient to wipe out the whole of the Queensland deficit. Does he know the amount that really could be raised from the sources indicated ? I have gone into the matter very carefully with persons who have held official positions in the northern State, and I find that the total sum which could be raised by such means, if a reasonable exemption were allowed, would not exceed £130,000 a year, from which amount the £66,000 now derived from a dividend tax would have to be deducted. When in Queensland recently, the State Treasurer assured me that there would be a deficit this year of between £600,000 and £700,000.
– That is not the deficit for one year.
– In customs and excise duties alone, Queensland will lose about £400,000. The railways also show an enormous deficit. Of course, it is most difficult to convince members of this committee of the serious position occupied by that State, and of the trouble which would be experienced in raising revenue by direct taxation. I have no desire to prolong the discussion, but I appeal to honorable senators from States whose finances are in a sound condition to take into consideration the position of Tasmania, South Australia, and Queensland, and to assist me in levying the small duty which I have proposed.
Question - That the House of Representatives be requested to amend item 84 by adding after the words “Kerosene, free,” the words “and on and after 1st August, 1902, per gallon 3d.” - put. The committee divided -
Ayes … … … 6
Noes … … … 16
Majority … … 10
Question so resolved in the negative.
– I move -
That the House of Representatives be requested to amend item 84 by adding to the duty “ Solar oil, residual oil, per gallon icl.,” the words “and. on and after 1st August, 1952, free.”
In the first place, I think it is interesting to notice that several classes of oil of widely divergent values have been included in the paragraph which embraces these two articles, and that while a duty of id. per gallon on solar oil and residual oil is excessive, it is a trifling impost upon naphtha, benzine, benzoline, and gasoline. It is equal to only 3 per cent, upon benzoline, which is worth at the present time ls. 8d. per gallon f.o.b. Upon naphtha it is equal only to about 4 per cent., while on benzine it is equal to an aci valorem duty of 5 per cent. Upon solar oil, however, it is equal to about 30 per cent., while upon residual oil, which is better known as liquid fuel, it is equal to 50 per cent. Whilst the rate of duty on the first three oils is very trumpery, and cannot interfere with any business which may be done in them, it is simply prohibitive in the case of liquid fuel. So far, no liquid fuel has been imported, and I am informed that it will not be introduced into the Commonwealth until this duty shall have been removed. At the present time liquid fuel is worth about 20s. or 25s. per ton, and as each ton contains 250 gallons, the duty is equal to 10s. 5d. per ton, or about 50 per cent, on the f.o.b. value of the item. Naturally in most parts of Australia liquid fuel is not likely to be largely used : but in remote districts to which coal can ba conveyed only at very great expense, it is very useful. It is very suitable for certain special industries. I have received the following letter on the subject from Mr. John Pender, of Messrs. John Pender and Co., nail makers, of Melbourne : -
I am a manufacturer of horseshoe nails, resident,in Brunswick, Victoria, Australia. Some years ago I invented a machine for the manufacture of nails, but never saw my way clear to use it until I had been to America, and had seen the application of liquid fuel to similar purposes, as it is possible to get a greater, move continuous, and cleaner heat (i.e., that is free from smoke and cinder) from oil than from coke or coal when applied to many lines of manufacture. I have recently obtained two machines from America made on my principle, fitted with furnaces for burning liquid fuel, it being my desire to use the most modern methods in the manufacture of nails, in order to turn them out at the lowest possible price, to compete with those imported from Europe. If a heavy duty, such as the present one, is put on liquid fuel, it will, by increasing the cost of the oil deprive me of all the advantages I expected to obtain from this, the most modern method of heating iron, in order to decrease the cost of production, so as to better meet foreign competition.
That is a statement by a Melbourne firm of manufacturers who I believe are fairly well known, and who are anxious that liquid fuel should be available for use in the industry in which they are engaged. I believe also that liquid fuel promises to play an important part in the promotion of mining operations in distant parts of the country, far removed from railways or the coast, to which coal can be conveyed only at a cost which makes it prohibitive. In such places the use of this article would assist in the development of mines which otherwise might not be workable. No question of revenue is involved, for at the present rate of duty there can be no importation of liquid fuel, and consequently there can be no revenue from it. Nor does the question of protection arise, unless it be suggested that liquid fuel is such a potent force that it may enter into competition with coal. That, however, will not be the case. Liquid fuel facilitates the work of various industries which materially assist to promote the prosperity of Australia, and as the prosperity of Australia generally increases, the consumption of coal must likewise expand. Therefore, I think that instead of the importation of liquid fuel having any detrimental effect upon the use of coal, the reverse will be the case. Solar oil is used solely in the making of gas, but it is of much less importance than residual oil, and., if the committee desire it, I shall be prepared to confine my motion to the placing of residual oil upon the list of exemptions. I submit the motion with every confidence, and I think that both free-traders and protectionists can readily unite in supporting it.
– I oppose this motion. The honorable senator has admitted that there is no great necessity for making solar oil free. I do not think that there is. It is used in the production of gas, and there is no reason why the gas companies should not pay a reasonable duty upon it. They must contribute to the revenue just as much as do other institutions or sections of the community, and I do not think that we are asking them to contribute too largely. All the oils subject to this duty were included originally under the general heading, but they have been made liable to this specially low duty because they are of use for the purposes of fuel or motive power. The honorable senator admits that the other oils in this paragraph have a very low duty placed upon them, and I think it is unreasonable to interfere with the duty so far as it affects residual oil.
– It is prohibitive.
– I do not know that it is, and certainly there is no reason why liquid fuel, which comes into competition with coal, should be admitted on special terms.
Question - That the House of Representatives be requested to amend item 84 by adding to the duty, “Solar oil, residual oil, per gallon,½d.” the words “and on and after 1st August, 1902, free” - put. The committee divided -
Ayes … … … 11
Noes … … … 9
Majority … … 2
Question so resolved in the affirmative.
Item 85. - Paints and colours, viz., ground in liquid, 2s. per cwt. Prepared for use, 4s. per cwt. Colours (dry), dry white lead, and patent dryers and putty, per cwt.,1s. Whiting, per cwt.,6d.
– I should like to know from Senator O’Connor how he distinguishes between paints “ prepared for use” and “paints and colours ground in liquid?” I ask the question because considerable trouble has arisen in connexion with the matter at the Customhouses. The ordinary white lead imported has some oil mixed with it, and it is held to be a paint “prepared for use.” If it is not, what are “ paints and colours ground in liquid?”
– Paints “ prepared for use” are paints ready for immediate use by simply dipping a brush into them : and “ paints and colours ground in liquid” are paints which have not reached that state of perfection.
– The Customs authorities claim, upon good authority, that paints are “prepared for use” if they have oil in them.
Item agreed to.
Item 86 - Varnishes, varnish stains, lacquers, enamels, japans, liquid sizes, patent knotting, oil andwood finishes, petrifying liquids, damp-wall compositions, lithographic varnish, terebine, liquid dryers, and gold size, per gallon,1s. 9d.
– I desire to move that the articles enumerated in this item shall be dutiable at an ad valorem rate. But if that cannot be done, I desire to place liquid dryers, which are not varnishes, either in the list of exemptions, or at a lesser rate of duty than1s. 9d. per gallon, which is over 100 per cent, upon their value. I should be glad of some assistance from the Chairman as to the best course to pursue.
– The honorable senator may move that liquid dryers be dutiable at a certain percentage, and, if that is not carried, he will still be at liberty to propose the imposition of an aci valorem duty upon the whole item.
– Liquid dryers would then be double-banked.
– To avoid complications, I prefer to deal with the whole item. I move -
That .the House of Representatives be requested to amend item 86 by adding the words “and on and after 1st August, 1902, ad valorem, 15 per cent. “
In submitting the motion, I have figures of a most reliable character to show how un: reasonable is the proposal to place the same rate of duty per gallon upon these articles. For instance, the landed cost in the States of liquid dryers, already referred to, is ls. 6d. per gallon, and this duty of ls. 9d. per gallon amounts to about 116 per cent, ad valorem, or by weight to no less than £2.2 10s. per ton. Liquid dryers, as every one who has any knowledge of painting material knows, are simply articles used to bring about the rapid drying of paint. The article is the residue remaining from the distillation of benzine, a spirit which pays duty at the rate of only ½d. per gallon under this Tariff. Senator O’Connor will admit that it would be a most extraordinary course to impose a duty of ls. 9d. per gallon on the residue of an article which is dutiable at only £d. per gallon. It has a certain drying property, but unlike varnish, terebine, and’ gold size, all of which are finished articles for decorative use, it is only a crude production, absolutely useless until it has undergone a process of manufacture. Dealing generally with varnishes, I do not know whether honorable senators are aware that they have a very wide range in value. On the English cost they range in value from 3s. 4d. to 35s. per gallon, and to impose a fixed duty of ls. 9d. per gallon upon articles varying so much in value is certainly an exceptionally clumsy method of deriving revenue. I do not propose to weary the committee with many details, but I may say that metal varnish is used extensively by meat preservers, jam preservers and syrup canners for lacquering their tins. It costs in England, 3s. 9d. per gallon, and the duty alone, therefore, is nearly equal to 50 per cent, of the cost. I shall not enter upon the question of natural protection, but it will easily be seen that that would considerably increase the protection given. Paper varnish, used on printed labels for all tinned and bottled goods, costs 3s. 4d. per gallon in England, and this duty is, therefore, over 50 per cent. Lithographic varnish used for mixing printing inks, &c, costs -is. a gallon in England, and in this case again the duty would be equal to about 50 per cent. This is not really a varnish, but a burnt linseed oil without any gum whatever in it. Tar varnish used by japanners on bedsteads is worth from 4s. per gallon at home, and this duty of ls. 9d. per gallon is a preposterously high duty upon an article which, to all intents and purposes, is a raw material for the bedstead manufacturer. These varnishes are used by meat packers, jam preservers, strawhat makers, printers, japanners, bedstead makers, cabinet-makers, boat-builders, and coach - builders. Coach - builders’ varnish ranges in value from 5s. 3d. to 21s. per gallon. One firm writing me from Melbourne states that the great bulk of the varnish used by carriage-builders is of the lower-priced description, and it is used chiefly on tradesmen’s vehicles. This varnish pays a very much higher rate of duty than that used on the better class of vehicles, such as landaus and broughams. For instance, a body varnish that is used on high-grade vehicles costs in London 22s. per gallon, while waggon varnish, which is used very extensively ]wre, costs in London only Ss. per gallon. Thus, at ls. 9d. per gallon, the rate per cent, works out on the high-grade varnish at 8 per cent., while the lower quality would pay 22 per cent. I have a great deal more information of the same kind herewith which I shall not trouble the committee at this late hour. For the reasons I have given I think it would be better to impose an ad valorem duty upon varnishes, most of which are used not so much for decorative purposes in connexion with buildings as by the trades I have enumerated. I have moved this motion, not in the interests of any importer, but simply to equalize the taxation of the different trades which use these articles.
– I think that Senator Neild will admit that his proposal, if carried into effect, would result in a loss of revenue. It is difficult to work out on the spur of the moment what the loss would be; but it has been the experience of the department in connexion with other items that less revenue is obtained from ad valorem duties than is obtained from specific duties. The estimated return from the . duty under discussion is £11,940, and during six months the actual collections amounted to £6,826. Therefore, the item is one of considerable importance, and, as we cannot afford to lose revenue in connexion with it, the honorable senator should not expect us to agree to the alteration of the whole plan of taxation in connexion with this division of the Tariff unless he can give us very strong reasons for doing so. The plan of this division was arrived at during the framing of the Tariff, and upon its subsequent discussion in the House of Representatives, only after careful consideration, and to alter it would not only affect the revenue, but seriously inconvenience both importers and the department. To show how difficult it is to settle these matters offhand by a quotation of lists and letters, I would point out that, whereas Senator Neild referred to liquid dryers as worth ls. 6d. per gallon-
– That is the home price.
– The firm of William Harland and Son, who, I understand, are well known English varnish makers, quote “best liquid dryer” at 14s. a gallon, upon which price the proposed duty is equivalent te an ad valorem duty of 12 J per cent., whilst the best terebine is put down at 10s. a gallon. None of the dryers upon the price list before me are quoted at anything like the rates given by the honorable senator. A manufacturer, writing on the subject, says -
Terebine liquid driers and gold size should be specially mentioned on item 82. Terebine and liquid driers are identical, the name being the only difference, and we are confident that no difference could lie discovered between them. This information can be obtained from any practical man in the trade. Terebine we are informed, is admitted free under the proposed Tariff’, and liquid driers has to pay ls. per gallon and 15 per cent, ail valorem. Why one should be free and the other dutiable we are at a loss to understand, as liquid driers could come in as terebine ? We wish to inform you that terebine or liquid driers are made by exactly the same process as varnishes, and we consider should be dutiable as varnishes. They contain the same ingredients, viz., Gums, linseed oil, on which there is a duty of Gd. per gallon (on the latter), also turpentine.
If we made the duty an ad valorem one, the department would constantly be called upon to decide what the value of the article imported really was, and a great deal of trouble would be given to both importers and Customs officials. It was originally proposed that the duty should be ls. per gallon and 15 per cent, ad valorem, but the House of Representatives altered it to ls. 9d. per gallon, striking out the ad valorem duty. A duty of ls. 9d. per gallon does not give an unreasonable amount of protection to the local manufacturer, because he has to pay duty upon both the methylated spirit and the dry colour which he uses, and that cuts down his net protection to a very low point. There may not be a large amount of capital invested in this business, but a large number of persons are employed in the manufacture of varnishes and similar articles in Australia. Why should we decrease the protection afforded to them and at the same time reduce the revenue derivable from this item? Under the State Tariffs Victoria imposed a duty of 2s. per gallon on varnishes, South Australia a duty of 6d. per gallon, and Tasmania a duty of ls. 6d. per gallon, while in Queensland the duty was 20 per cent, ad valorem, and in Western Australia 10 per cent, ad valorem.
– Senator O’Connor has referred to the difficulties incurred in collecting ad valorem duties, and has told us that an ad valorem duty returns less revenue than a specific duty. But, inasmuch as some kinds of varnish are worth 4s. per gallon, and other kinds as much as 30s. or 35s. a gallon, according to their quality, and the use for which they are intended, it is necessary to impose an ad valorem duty in order that the taxation may not fall chiefly upon the users of cheap varnishes. Senator Neild has proposed an ad valorem duty of 15 per cent. At that rate, varnish worth 10s. a gallon would pay a duty of ls. 6d. per gallon, and in the House of Representatives the voting upon the proposal to make the duty ls. 6d. per gallon was equal. Fifteen per cent, would give a large amount of revenue, and a fair amount of protection to those engaged in the manufacture of varnishes within the Commonwealth. There are however, very few persons so engaged, and it would not require very many to produce the whole of the varnish used in Australia; so that the industry is not one of rauch importance.
– The whole division is framed on the plan’ of specific duties.
– The policy of the House of Representatives was-to change ad valorem to specific duties, but that is no reason why we should not make a departure in favour of ad valorem duties where we consider it advantageous to do so. A very large number of people take contracts for varnishing and painting, and it is of importance to them to know what amount of duty they must pay upon their raw material. I hope the committee will agree to the motion.
– In 1900 duty was paid upon an importation of 42,558 gallons of varnish into Victoria. The Victorian duty was 2s. per gallon, and the amount collected £4,255. Under a duty of1s. 9d. per gallon - the rate in this Tariff - the collection would have been £3,700. An ad valorem of 15 per cent, would realize £3,280, which would be very little less than equivalent to1s. 9d. per gallon. An ad valorem duty would operate more fairly than would a fixed duty, and as the revenue would not suffer to any appreciable extent Senator Neild’s proposal is amply justified.
– I should like the consideration of this important item to be postponed, as I have a large amount of information to submit to honorable senators.
– Nothing can be gained by further discussion.
Question - That the House of Representatives be requested to amend item 86 by adding the words, “and on an after 1st August, 1902, ad valorem 15 per cent.” - put. The committee divided -
Ayes … …… 7
Noes … …… 10
Majority …… 3
Question so resolved in the negative.
Motion (by Senator Lt.-Col. Neild) put -
That the House of Representatives be requested to amend item 80 by adding the words, “and on and after 1st August, 1902, advalorem 20 per cent.”
The committee divided -
Ayes ……. … 5
Majority … … 5
Question so resolved in the negative.
Item agreed to.
Motion (by Senator O’Connor) proposed -
That the Senate do now adjourn.
.- I desire to ask the Vice-President of the Executive Council a question.
– Our standing orders provide that the motion for adjournment shall be submitted without discussion, and I cannot permit the honorable senator to ask any question unless it relates to the business of the House.
– All I wish to ask is whether it is intended that the Senate shall sit on Monday next?
– It is not my intention to ask the Senate to sit on that day.
Question resolved in the affirmative.
Senate adjourned at 10.27 p.m.
Cite as: Australia, Senate, Debates, 10 July 1902, viewed 22 October 2017, <http://historichansard.net/senate/1902/19020710_senate_1_11/>.