David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Hansard source

Each of these parties supports these bills. I accept that interjection from Senator Xenophon; I condemn him as well.

These bills are some of the worst to be put to the parliament this term. The bills introduce a high effective tax rate on imported ethanol and biodiesel, to align with the tax on petrol and diesel. This is to occur in nine days' time. The bills gradually introduce an effective tax rate on domestically-produced ethanol and biodiesel, with the final tax rate on ethanol representing only a third of the tax on petrol, and the final tax rate of biodiesel representing only a half of the tax on diesel.

The bills hit motorists hard, but the Liberals are silent on this, despite their claims to being a low-tax party, because they realise that, to improve the budget position, the path of least resistance is to increase tax. By introducing a significant wedge between the tax treatment of imported and domestically-produced product the bills represent a bold return to protectionism. There is not a murmur about this from Labor, which has a proud history of reducing protectionism to the long-term benefit of Australian businesses and consumers. The support of the Greens for the bill is expected. They rail against tax concessions for superannuation, but they will happily accept a tax concession for biodiesel over diesel. And the support of the Nationals is also expected—they will support any handouts to farmers, no matter how perverse, including mandating the inclusion of ethanol in fuel, irrespective of the economics and how market-distorting it is.

The Liberal Democrats are the only supporters of free trade, low tax and the abolition of corporate welfare in this place. The other parties should hold their heads in shame.