Eric Abetz (Tasmania, Liberal Party, Deputy Leader of the Opposition in the Senate) Share this | Hansard source

The opposition fully supports the amendment moved by Senator Xenophon. I can indicate that in the event that Senator Xenophon’s amendment is carried we of course will not be pursuing our amendment, which is the next one on the running sheet.

We as an opposition are of course very gracious and willing to allow Senator Xenophon to move this amendment, which is, in fact, in identical terms to an amendment that we moved. The reason I say that, albeit sort of tongue-in-cheek, is that as soon as the government made this announcement with its retrospectivity we as an opposition announced that we would be opposing this retrospectivity on a matter of principle. We made that announcement even before Senator Xenophon took his seat in this chamber.

We in the opposition are very strongly of the view that this sort of retrospectivity in taxation should not be countenanced by any side of politics. Allow me to briefly explain what the current proposed legislation would do. For somebody who in good faith ordered a car on, say, 1 May 2008 with a delivery date after 1 July 2008, Labor would say that they should pay the new 33 per cent luxury car tax albeit when they entered into the purchase contract—and, chances are, they would have entered into their finance contract when they worked out all their dollars and cents, including their stamp duty liability—they would then be whacked with this extra impost of an extra eight per cent because they could not get their car before 1 July. And of course the extra tax would then have the multiplier effect on the stamp duty payable to the state government.

We believe that Australian citizens as much as possible ought to be allowed to go about their business without the prospect or without the concern that they could face a further tax impost after having entered into a legal arrangement such as a binding contract. It is interesting that the government did not slip a note across to the crossbenches to suggest that this might have another $400 million impact, or blow some other hole, because I think in their heart of hearts they acknowledge that it is unconscionable. Unfortunately, Treasurer Wayne Swan has defended this retrospectivity, which I would have thought most people would say is just unfair. You make your business arrangements, you organise your loan agreement, you add up your dollars and cents, you try to work out how much you have to pay for a new car, and then, having entered into the contract before budget night, all of a sudden after budget night if the vehicle is delivered after 1 July you will face this impost. The amendment that we had mooted before Senator Xenophon moved his amendment is a principled amendment and we in the opposition fully support it.