Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Hansard source

I begin my speech on the government's big new tax on fuel with a couple of quotes:

Fuel tax is a tax on distance. If ever there was a country that should not aggressively tax fuel, it is a vast country like Australia. It is a tax on doing business outside of the capital cities. It is a tax on farming in the distant parts of our nation. It is a tax on living and setting up a business in a country town.

Who said that? None other than the Deputy Prime Minister, the same Deputy Prime Minister who is now standing with the Prime Minister supporting higher fuel taxes. Here is another quote, from the former member for McEwen, Fran Bailey:

I have always believed that the fuel excise system lacks equity, because those who live and work outside metropolitan areas pay a disproportionate amount of the excise simply because they need more vehicles per household, they use more fuel and they do not have access to regular public transport.

Or we can quote the member for Gippsland, Mr Chester:

Now we have this fuel tax, which has been presented to the House in the form of this legislation. It will have a direct impact on the cost of living, particularly in regional areas.

That is the member for Gippsland. Is he going to be voting in favour of this big new tax on fuel? We will see when we divide whether he stands on the Labor side or he chooses, like Mr Truss, to put his tail between his legs. And there is Mr John Anderson, the former Leader of the National Party, who said:

There a lot of people in this country—in practical terms, I am one of them—who have to drive a heavy four-wheel drive. Even in my own home village, just filling up a Toyota Landcruiser station wagon the other day cost me $121.50. It is a real issue.

He went on to say:

None of us like to see rises in crude oil prices and none of us like to see people in far-flung regions disadvantaged.

So a plethora of past National Party members and Liberals have spoken out against fuel tax increases.

There are a few, just a precious few, of the current crew who are willing to speak out. The member for Flynn, Ken O'Dowd, has criticised the government's big new tax on fuel, saying that it will put pressure on inflation. He said:

I'm concerned that it does put all the costs up …

… It's another tax and I guess it could be a broken promise.

We will come back later to whether or not it could be a broken promise. He said:

Whether it be tomatoes or lettuce, premium beef products … anything that you buy virtually will all go up and [it] will have that inflationary effect on the economy.

That was the member for Flynn speaking to the ABC on 9 May 2014.

Then there is Senator Macdonald—bless him—taking many of his deep concerns with the government's decision to the floor of the other place. He said he will not make a final decision on whether he will support the government's increase in fuel taxation until he receives official advice on how the measure will affect drivers in the bush. I do not recall having seen such modelling put forward and, frankly, I do not ever recall having seen the National Party asking for modelling on how it affects people in the bush. This is a bit strange because certainly a couple of years ago if there had been a measure put in place that would disproportionately hurt rural Australians the National Party would have been screaming blue murder, but now it is just Senator Macdonald standing on his lonesome. The rest of the National Party, with their tails between their legs, are joining their Liberal Party colleagues. Where has the once great National Party that stood up for the bush gone? Can anyone hear a voice of National Party support? No. The Greens, it appears, are doing more in standing up for the bush than the National Party. It is Bizarro World indeed.

What is the effect of this increase in fuel taxation? During a wide-ranging private conversation with US President Barack Obama, Prime Minister Abbott said: 'I may be against carbon pricing, unlike you, but it is okay, President Obama. I am really with you in spirit because my new fuel tax acts like a carbon price.' That is what he said: a fuel excise acts like a carbon price. As the member for Grayndler has noted, it is just a 'carbon tax on steroids'. This extraordinary statement might seem out of character. People might say: 'Why would Prime Minister Abbott go into the Oval Office and describe a fuel tax as a carbon tax? It sounds so unlike him. Surely he has been misreported.' You would think that if you had not been listening carefully to Prime Minister Abbott in 2011 when he said:

If you want to put a price on carbon, why not just do it with a simple tax? Why not ask motorists to pay more …

There he was in 2011 saying that an increased fuel tax was just like a carbon tax. It is not surprising that, with a rush of blood to the head standing in the Oval Office, those words of 2011 just came back to Prime Minister Abbott and he just blurted them out. He said: 'It's okay. I'm against an effective, efficient carbon price with household compensation, but really I'm with you in spirit, President Obama. I have put in place my own little carbon tax.' This is the view that has been taken by the Australian Automobile Association. They said that the new change does operate as a backdoor carbon tax. AAA Chief Executive Andrew McKellar told the ABC PM program:

… effectively, it's a backdoor carbon tax, so how it can be rationalised by the Government, that this makes any sense at all, either economically or politically. I think it really leaves many people wondering.

That is the CEO of Australia's chief motoring association. In the context of whether the increased fuel tax is or is not a carbon tax, I do not want to dwell too much on Senator Milne's comments, but as an economist I draw the attention of interested members to a crikey blog post by Alan Davies in which he carefully takes apart Senator Milne's comments on Insiders and really demonstrates the economic illiteracy of the Greens and their misunderstanding still, after nearly a decade of talking about carbon pricing, between income effects and substitution effects. Alan Davies's blog post is recommended reading for those interested in such esoteric matters as the Greens' understanding of economics.

What did the Prime Minister say before the election? Did he leave things open? Did he say: 'When we get into office maybe taxes will have to go up; maybe they will come down. We will just see. It will depend on the budgetary situation. We will see how it goes. No promises now'? I am afraid he did not. I need to take the House through a few of the statements that Mr Abbott made during the last term of parliament. Speaking in parliament on 28 October 2010 he said:

We stand for lower, simpler, fairer taxes, not great big new taxes that damage Australia’s economy, not great big new taxes that are yet another hit on the cost of living of struggling Australian families.

It is hard to see what this change could be but a hit on the cost of living of struggling Australian families. During a speech on 24 November 2010 Tony Abbott said:

We are Liberals who believe in smaller government, lower taxes, greater freedom.

In this House, standing at this very dispatch box, on 10 February 2011 he said:

The one thing that they will never have to suffer under a coalition government is an unnecessary new tax, a tax that could easily be replaced by savings found from the budget.

On 23 February 2011 he said:

We honour the victims of the floods by being a competent parliament and a competent government. We do not honour them by imposing an unnecessary new tax.

The ends, Tony Abbott said, could never justify the means if the means were a new tax. On 10 February 2011 he said:

Why should the Australian people be hit with a levy to meet expenses which a competent, adult, prudent government should be able to cover from the ordinary revenues of government?

Tony Abbott was very clear before the election that, no matter where the money was going, new taxes could never be justified. He did not say it just a few times; he kept on saying it. In his first budget reply speech on 12 May 2011 he said:

People can be confident that spending, debt and taxes will always be lower under a coalition government because we have the record to prove it.

See this speech in context