NO.080

Claims by Labor that today’s interest rate increase was related to GST are

patently false.

The statement by the Reserve Bank of Australia sets out the reasons for today’s

decision. The Bank makes it clear that it will abstract tax changes and base policy on

ongoing inflation. Its decision today relates to the higher growth and stronger activity

in the past 12 months, which it expects to be sustained into the near future.

Even people with the poor economic understanding of Beazley and Crean should be able to

understand that. Of course, blaming the GST is a cheap, opportunistic and reliable

response.

If Mr Beazley really believes that GST is responsible for higher interest rates, he

would pledge to repeal it and re-impose his beloved wholesale sales tax. After three days

of Labor Party conference he has done everything to indicate he is preparing to do nothing

on tax …except blame it for everything.

Mr Beazley and Mr Crean can only be judged on their policy record. Under Labor, home

loan interest rates hit a peak of 17 per cent.

Home mortgage interest rates under 13 years of Labor Government were never as low as

they are today.

Their past deeds are signposts for future action, not their hollow words today.

2 August 2000

Contact: Niki Savva

03 96500244

MELBOURNE