NO.084

BEAZLEY’S ROLLBACK: ALL TALK, NO TICKER

Labor’s grand plan for the rollback of GST amounts to a promise to keep over $29 out of every $30 of GST collected.

Its promise on gas and electricity is a promise of rollback in 20 months time. It claims this will save households the grand sum of $1.92 per week!

But of course the compliance costs of electricity and gas suppliers will increase and eat away this supposed saving.

This was made clear recently by the Electricity Supply Association of Australia, which warned the increased compliance burden of any rollback on power bills would have to be passed on to consumers.

The managing director of the Electricity Supply Association of Australia, Mr Keith Orchison, said in the Association’s June newsletter that it does not favor the GST on electricity being rolled back, primarily because of the considerable compliance burden that would be involved.

Additional compliance costs must be passed on to customers, Mr Orchison said.

Every electricity and gas utility across the country will have to separate business from private consumption; and re-do billing systems. They will have to separate and separately account GST sales and GST free sales.

Mr Beazley’s promise of lower costs is a myth, like so many other promises he has made.

The proposed measures announced by Mr Beazley today will not make the GSTsimpler or fairer.

Every corner store, pharmacy, convenience store and supermarket in every small town and city in Australia will have to re-programme their cash registers and computer software to take account of sanitary products and nappies.

As his economic adviser Mr Geoff Carmody of Access Economics said, 29 June 2000: Proponents of further roll-backs of GST as an election promise show no understanding of how GST works. GST-free does not mean you are out of the GST system. It means you don’t have to charge GST on sales but you sill have to register to claim back GST on business inputs. Ask the corner grocer whether more roll-backs over the roll-backs already forced by the Democrats will help. Answers will be unprintable unless the promise is 100 per cent roll-back. Anything less does not reduce business compliance costs at all.

Mr Beazley has nominated health and education as his biggest priorities in this election.

Well, the Labor Party opposes the GST, and in government we will roll it back in health and education, Mr Beazley said in and address to the nation on July 3, 2000.

Only days later, Mr Beazley again promised: I can tell you today, that we won’t be moving a millimetre from our stance of rollback.

There was nothing in today’s announcement, of any rollback on health or education.

If he had the ticker, Mr Beazley could rollback the GST to nothing.

He could reintroduce wholesale sales tax, wipe out personal income tax cuts, double the capital gains tax rate and increase company taxes.

Mr Beazley has proved today he is all talk and no ticker.

MELBOURNE

19 October 2001