Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

Of late, we have read a lot in the papers about the GST and recently I have had something to say on that matter. It has been in The Australian and in the local newspapers that I stand against a rise in the GST; a rise that we were told was never going to happen. That was a guarantee that was given when this pernicious tax was first introduced. We were guaranteed 10 per cent—no further. The guarantee was that you would have to get all the states to agree and that would be politically impossible. We now know what is happening. The cuts forced on the states by the federal government, $60 billion of them, have forced the state premiers into this difficult position. We now find that a tax that was never going to rise is going to rise from 10 per cent to 15 per cent. I joined the Labor Party in 1992 to oppose such a 15 per cent GST tax and I continue to oppose it.

The first thing this is about is that it is a regressive tax transfer from poor people, the working class and the middle class to the wealthy. That is the first thing it is—a regressive tax transfer. It is putting on consumption taxes, which are regressive taxes, and cutting income taxes and corporate taxes for the rich. That is what this is all about. The second thing this is about is locking in spending without reform or efficiency. On the one hand, we have this bizarre coalition of people who want to give the top end of town a tax cut and load the whole of the burden of fiscal consolidation onto pensioners, the working class and the middle class. On the other hand, we have another group of people who want to lock in spending in hospitals and health but without reform and without efficiency. We all know that there is a vital need in health for reform and efficiency.

There has been a debate recently, and there will continue to be a debate. It is good to see Paul Keating out there today talking about what a lazy tax this is, and how inevitably, if it rises to 15 per cent, it will only go in one direction from there—to 20 per cent. After that, who knows? Those opposite are addicted to consumption taxes. They have been talking about them the entire time I have been a member of a political party. The entire time it has always been, 'We want a 15 per cent GST with a broad base on food.' We know the effects of this tax will be regressive and will be inflationary—and now, thanks to Paul Keating, we know it will lock in inefficient spending and a larger public sector.