John Williams (NSW, National Party) Share this | Hansard source

I would like have my input on the Tax Laws Amendment (Luxury Car Tax) Bill 2008. First of all, I oppose the tax totally. It is hurting the industry. I have a graph from representatives from the industry showing the effect on the motor vehicle industry since the introduction of this tax—a tax that is now being collected by retailers and held in trust. The demand for such vehicles has dropped down enormously.

Let us reflect back to the year of 1948. Sixty years ago from this year, the first Australian car, with all its glitter and the chrome on its bumper bar, was proudly pushed out onto the road, the 1948 Holden. What a proud moment that was for Australia. Now we have situation 60 years later in which the government of today is prepared to put a tax on this industry to, as I see it, help close it down.

We heard yesterday from my friend Senator Birmingham about the 4,500 Holden Statesmans built last year which will fall under the umbrella of this increase in tax. We have seen a huge drop-off in demand for these types of vehicles. That spells the loss of jobs in Australian industry. It will be interesting to hear what Senator Carr, as Minister for Innovation, Industry, Science and Research, has to say about this situation later on.

We heard time and again about working families as we ran into the federal election. It was like a scratched record; it was as though the Rudd campaign had taken a Working for the man 45 from Roy Orbison and scratched it or restamped it. It went on and on. Working families? What about the working families in our car industry; in Holden and Ford? Don’t they count? Are we going to tax them out of existence?

It is simple. In my time on the farm, we would often be around the sheep yards working in the sun—or hopefully sometimes in the rain—drenching sheep and I would often listen to John Laws, the man with the golden microphone. He had a lot to say, and I often agreed with him. One of his common statements was, ‘The more you tax something, the less you have of it’. It is as simple as that. This government is going to tax our car industry and push it to the wall. It was a tragic day when we saw Mitsubishi close down in Adelaide. I lived in South Australia and I remember when it was Chrysler and Valiants that were made there. My uncle worked there. They were vital jobs. But that has gone. What will be next? These industries are being put under threat by this government.

Tough times are ahead. I fear what is happening in the overseas financial markets; the troubles that we have seen in the United States and the flow-on around the world. We are coming into some very tough times. I hope that I am wrong. But there is clear evidence that things are becoming very scary and very dangerous around the world, and we need to have a government that is prepared to look at what they are actually doing in terms of protecting our jobs, our families and our industries.

Why do they want the extra money? They are fortunate to have been handed a budget well into surplus; they are fortunate to have taken over a government that is debt free—the $96 billion has been paid off. Now they want to grab some more. It is crazy because the economy is definitely slowing. It has certainly slowed in the regions I come from because we have had seven years of drought. There is no need to put the handbrake on them any more; they have had enough.

I simply say this: if the government are concerned about working families, do not assume that all who work in Ford and Holden are bachelors and spinsters and do not have families; in fact they are working families and they will be under threat. I think it is a disgraceful tax, and it is a tax that the government are using to try to show to the people that they are fiscal conservatives. We know it is not true. I live in New South Wales, and we have seen how the Labor Party manages money in New South Wales. We saw what their predecessors pre-1996 did when it came to managing money. They had no hope of managing money.

What about those who live and work in country areas? Take the vet. The vet might have a four-wheel drive wagon. If he is called out to the farm he goes out on the dirt track. The creeks might be running a bit, the road could be rough—bulldust, holes, corrugation; I am familiar with them all. I have travelled them for many years, I can tell you. That vet might have a four-wheel drive wagon that cost more than $57,180. It is essential to his or her job, to carry out their work, but the government views that as a luxury. What are they supposed to drive? Some little imported Hyundai Excel? The first time you drive across a grid you wipe the bottom of the car out. They need to drive in safety. They need to be able to carry out their operations in a safe way. We hear about OH&S—it is thumbed to us all the time in New South Wales by the government there with all the red tape and rot that they go on with. But here they are bringing in a tax that is going to encourage people not to travel in a safe vehicle on rough roads.

We move on to the contractors. As Senator Joyce said yesterday, the only tractor you should have on a farm these days is a contractor, and how right he is because of the cost of machinery. I refer to, say, the wheat harvest coming up. Thankfully this year we have had some rain in the last couple of weeks that saved the wheat crop. Look at the typical contractor. Say he and his wife have three or four headers. You need $400,000 or $500,000 today to buy a new header. The average farmer cannot outlay that sort of money unless they have a lot of acreage of wheat to harvest—some 5,000 to 10,000 acres or whatever. So the contractor comes around. He might have three headers and three header drivers, because they do not drive themselves. He might have a couple of trucks to cart the grain into the storage on farm or to the silo or whatever. What is he supposed to do? Drive a Toyota tray top, which is not exposed to this tax, and cart the workers in the back of the ute? No; what he has got to do is have a wagon to cart people around—a wagon with some weight, size and strength in it. That will certainly be above $57,000. The situation is this: he probably has a trailer behind it with the spare parts, the oil, the grease and everything that contractors take with them but he is going to be taxed. Under the amendments that are being proposed he will not be exempt from it. The amendments—I will get to them later on—are simply unfair and to me look like a dog’s breakfast. The vet and the contractor are some that will not be exempt from the tax.

Then there are those people who choose to live out of town. They might be schoolteachers, wives, kids. They just need a vehicle. They might have four children and therefore need a bigger vehicle—a Toyota Prado, say, that comes in at around $64,000. They might have a couple of hundred acres of land. It is their right to buy that and to live out of town. But if the majority of their income is not sourced through primary production, they are not exempt under any amendments that are going to come forward today. It is just a tax on those country people for having a vehicle for their safety and their security and to be able to get along the rough, wet or muddy roads perhaps even to get their children to a doctor or a hospital in the case of an emergency. But this government says, ‘We are going to tax them out of existence. They are irrelevant.’ It is disgraceful.

I thought that when I came down to this place the first thing I would see would be governments having some compassion. This tax shows no compassion to people, especially those in the rural and regional areas that I am here to proudly represent. So when these amendments come up there will certainly be some strong arguments against them.

The tax is a socialist tax. I will go back to what John Laws used to say before he retired, ‘You do not make the poor rich by making the rich poor.’ And that is what this is about. Someone gets out and works hard, becomes successful and then faces an extra tax because Treasurer Wayne Swan wants to grab the show and say: ‘I’m a great fiscal manager. Look, I have a $22 billion surplus.’ The only reason he has a surplus at all is because of the previous government and the way they managed the money—no other reason at all.

I will give you one example. A friend of mine rang me before I entered this parliament back in about June and he told me what was going on. This bloke comes from a little town called Bundarra, just south of Inverell. He is a shearer. I know those on the other side of the chamber are probably not familiar with shearers but in fact the shearers and the AWU actually started their party. That is how the Labor Party started. He is a shearer and a bulldozer operator and he worked hard and became a little bit successful. Isn’t that what life is about in this free enterprise world? Work hard, work smart and develop wealth? That is certainly the wish of most people I know. Now he faces a luxury tax because his 14-year-old Toyota LandCruiser has done about half a million kilometres and is now due for changeover. He is landed with the tax. So this is what this tax is about—penalise those who have a go. To me that is not the Australian way.

I want to refer to a couple of other issues. I have received some information from Andrew McKellar from the Federal Chamber of Automotive Industries. I have graphs, which I will not present to you, but you can believe me that he has forwarded them to me. They show the way the industry has lost demand since the introduction of this tax. I have been in business for many years. In the last nine years I started my own business from scratch. It is a pretty hard game when you get out into small business and you start from scratch. The first thing you need is a market. No matter what you have got, whether it be goods or services, you need to be able to sell what you are selling. And here is a drop-off in demand in the industry to such an extent that I really fear how these people are going to maintain their jobs and what is going to happen, especially in our domestic motor vehicle industry.

What is one of the worst things you can have happen to a family? One of the worst things is mum or dad comes home Friday night and says, ‘Here’s the good news!’—being a touch sarcastic—‘I finish up in two weeks time.’ The first thing the family thinks is: ‘How do we pay our mortgage, how do we make our payments on our home, what happens to the car’—they might not have paid for it—‘is it going to be repossessed?’ What sort of stress does that put on families? It puts a huge amount of stress on families. I have been through it myself and it is not a lot of fun, as I said in my maiden speech on Monday. But this government says, ‘That doesn’t matter. We’ve got $20 billion in the bank and we want to make it a bit more, so we’re going to tax these people.’ These are the battlers of our nation that are prepared to have a go. ‘That is what we’re going to do and we think it’s good fiscal policy.’ I say it is crazy policy.

I want to refer to those people living out of towns who look at four-wheel drives. My main concern about this tax is for the people who need a four-wheel drive for safety reasons. I have driven about three million kilometres since I left school: a million in semitrailers and about two million in all sorts of other vehicles. One thing that I learnt long ago is that, in Australia, when you are out in the bush, wherever there are trees there are roos. It is as simple as that: if there are trees there, there are roos there. I have yet to go through any timbered area in this nation and there not be kangaroos there. And thanks to the development over 100 years of better water supplies, bores and pumps and everything else, the roo population is extremely high. In the old days they died in the drought—there was no water. That is not the situation today.

If you are travelling at night, mum and dad are bringing the kids home from a school eisteddfod or whatever, the first thing you need is a strong vehicle that can support a strong roo bar. If not, you can imagine, where I live—minus three degrees, 11 o’clock at night and you put the fan through the radiator and you are on Shanks’s pony—it is not a very safe place to be. That is why people, not only the farmers—and Senator Fielding has got some exemptions, I believe, in his amendments for them—but the people who work on these farms and choose to live out in these areas, should not be taxed for being safe, for protecting their wife and children to be able to get home at night without walking along. These are the issues that the government should consider before they push through this tax grab.

Senator Xenophon and Senator Fielding, coming from South Australia and Victoria, should realise that they have industries in their states that are vital for jobs. It is vital that those industries stay alive in this tough, competitive world where we see imports of vehicles from countries where you are lucky if you are paid $5 a day. I have been through the factories in Thailand over many years and seen the conditions that people work in. I certainly hope they improve in time, especially when it comes to some of the safety issues there. Senator Xenophon and Senator Fielding should realise that this is going to hurt their industries. But the blame will come back on the government. When the economy slows further, as no doubt it will with the traumas around the world, they are the ones who are going to have to answer. And do not think for a minute that everyone in South Australia, Victoria and the rest of Australia are suffering from amnesia, because they will remember it come election time. They will know who put the pressure on industry, who made it harder for the people out in the bush—the contractors and everyone else—and who is going to suffer the most.

As a proud National, I will be putting some amendments up. They are just simple amendments—not a dog’s breakfast, not complicated, not a situation where they will have paperwork to do and claim up to $3,000 back or whatever, but simply a two-tiered system. At $57,180 the status quo remains at 25 per cent luxury car tax. Then at $90,000 the second tier will cut in where the tax will go to 33 per cent. So the situation is this: the money grabbers on the other side, who want to tell the rest of Australia that they are fiscal conservatives—we have heard it all before—and really can manage money, can get the money out of their Maseratis and Ferraris and Porsches and all those things that the Treasurer is holding up after we rejected it last time. I have yet to see a Porsche in Inverell or any country town. Likewise, a Ferrari or these other names of cars I cannot even spell, because we have never seen them. We have hardly ever heard of them, let alone seen them and read the badge on them. They can get their 33 per cent. That doesn’t worry me at all, because they do not exist where people such as myself and Senator Nash have our offices—two of the lucky senators in New South Wales who have our offices not in the city but out in the country areas, because people live there and people need representation. I must thank Senator Faulkner, too, for allowing that to happen. I am very pleased that Senator Faulkner did sign off to allow me to have my office in a country community. I do thank you very much for that.

Our amendment will be simple. There will be two tiers. The current system will remain at $57,180, which will not put more stress on our domestic industries, to keep them alive. Over $90,000 they can grab the tax, because the GXL Toyota LandCruiser 4.5 diesel is under that rate, and that is about the heaviest and strongest vehicle, along with some of the bigger Nissan Patrols, that are the common ones in country areas. If they want to go to a BMW four-wheel drive at $120,000, so be it; we don’t see many of them in the bush either. The amendments will be simple. We will propose to CPI those two levels so that a bit of fairness comes into the tax. That is where we stand on it, to protect the people.

Our first goal is to throw this tax out. It is not necessary, it is not needed. They do not have to crank hard on the fiscal policy of this nation, because the country is slowing. We have seen interest rates drop already. The pessimism is because the government has talked the economy down, they have put the bears into the sentiment. People are becoming negative. We see business and consumer confidence dropping to all-time lows because the government said they had inherited an economy that was so wrong. We will be putting these amendments up; we will be fighting for the people we represent. And I suggest that Senator Fielding and Senator Xenophon, who come from those states where these cars are manufactured, have a good look at our amendments, because they will be the ones answering to their states, and the people do not have amnesia, as I said before. I urge people to have a good, close look at the Nationals amendments—they will be supported by the Liberals and our friends over there—so some commonsense and fairness can get into this whole debate.