E&OE....................................................................................................
SATTLER:
I notice you've taken up golf and I'm organising a game
that I'd like you to attend, are you available on either October
3, 10 or 17?
PRIME MINISTER:
Well, can I check? I have received a few dinner invitations for
the night of the 17th of October, largely from interviewers
like you who are asking the same question in a similar form.
SATTLER:
Oh, we'll go back to the club house afterwards, don't
worry about that.
PRIME MINISTER:
Okay. I'll get my diary secretary to come back to you, Howard.
SATTLER:
Would you play golf on an election date?
PRIME MINISTER:
Probably not, that might be looking a little too laid back.
SATTLER:
So one of those dates will be out, will it?
PRIME MINISTER:
No, that doesn't mean that at all. I'm just answering
in a generic fashion.
SATTLER:
Okay, I'm sort of just wiping out weekends here. Would you
consider going to a poll on the long weekend?
PRIME MINISTER:
Howard, I'm not ruling any weekend out other than the weekend
of the grand finals.
SATTLER:
Because the voters of New South Wales, Tasmania and the ACT wouldn't
be too pleased about you going to an election on October the 3rd,
would they, because a lot of them are going to be away?
PRIME MINISTER:
Well, it's all hypothetical.
SATTLER:
I know it is, but I mean...
PRIME MINISTER:
We are wasting a lot of time on a hypothetical question.
SATTLER:
All right, well are you prepared then let's get to
the tax package because that's what you are doing...
PRIME MINISTER:
Yes.
PRIME MINISTER:
Are you prepared to sign a legally binding contract with the Australian
electorate that you will honour all aspects of your tax package
if your Government is re-elected?
PRIME MINISTER:
Look, I am making a commitment before the Australian public. They
can vote for it or they can vote against it. In the end that is
the ultimate that any political figure can do. And you can play
around with signing documents, I mean, I saw Bob Carr talk about
signing things in blood. I mean, those sort of things are gimmicks.
In the end people listen to what you say, they make an assessment
of whether what you are saying is credible and whether you are credible.
Now, I put myself on the line, when the election comes, to the Australian
people and it is for each individual Australian to decide whether
he or she will support the plan I'm putting forward. It is
not going to be advanced or diminished by these silly little gimmicks.
SATTLER:
I know that but if you want the Australian public to trust you,
and there is a problem between the electorate and politicians on
that spectrum, on trust, why wouldn't you sign a document like
that?
PRIME MINISTER:
Howard, I don't think trust is advanced by gimmicks. I think
trust is advanced by what you do compared with what you say. Now,
one thing I will say to the Australian people about this tax plan,
among many things, and that is that it is big, we are in a sense
asking them to accept the good as well as the not so good. We're
saying you can't have the good bits without the hard bits.
We're not just offering a lazy tax bribe before the election.
We are saying to the Australian people, unless we are prepared to
reform the system to repair the cracked foundations of the Australian
taxation system by bringing in a goods and services tax, getting
rid of all those wholesale sales taxes and a whole lot of State
taxes, you cannot have permanent tax relief. Mr Beazley is opting
the easy...
SATTLER:
Okay, but how can there be bad news when you say everybody's
going to be a winner?
PRIME MINISTER:
I'm not saying there's bad news for individuals, what
I'm saying is there are hard bits in it because the hard bits
are the change.
SATTLER:
Everybody's going to have more money in their pockets, which
is what you're suggesting, why would anybody be unhappy with
it or is that not true, are there going to be some...?
PRIME MINISTER:
Well, it is, it is true.
SATTLER:
Everybody will have more money in their pocket.
PRIME MINISTER:
Hang on, there is one qualification I've always made to that
and that is the tax cheats will be worse off. I heard this morning,
for example, in Mr Beazley's plan or promise on Thursday, there
won't be anything in it for pensioners and self-funded retirees.
And his explanation for that is that he's not going to introduce
a GST so he doesn't have to give them anything extra. Well,
I would say to those pensioners who are listening to this programme
that not only are we compensating you in our plan for the full cost
effect of the GST, but we are also adding a 1.5% real increase in
your pension on top of the cost increase under the GST. Mr Beazley's
unwilling to do that. Mr Beazley expects you to believe that he
won't, after the next election, do what he did after the 1993
election, promise you tax cuts, oppose the GST and when he wins,
put up all the indirect taxes and not give you any compensation.
SATTLER:
Okay, so you're saying we can't trust that side...
PRIME MINISTER:
Well, I'm asking you to look at their record. I'm asking
you to look at their...I mean, I'm not asking you on the
basis of what he is now saying, but I'm asking you on the basis
of what he did. He was the Deputy Prime Minister to Mr Keating that
promised the L-A-W law tax cuts. He opposed a GST. He won the 1993
election and as soon as he got in he took away the tax cuts, and
to rub insult into injury, particularly to pensioners, he increased
every indirect tax rate, every single one. He gave them no compensation.
And one of the most respected tax academics in Australia, Neil Warren,
said that was Labor's GST and what was worse he'd have
no compensation.
SATTLER:
All right, what are we going to do about your side if you get in
and then you break some of the promises we'd have to
wait another three years to do something about it?
PRIME MINISTER:
Well, we won't be.
SATTLER:
Promise...
PRIME MINISTER:
Look, we won't be. Look at the...I mean, look, Howard,
it stands for reason...
SATTLER:
Yeah but Asia could turn down even further. I mean, the prices
could get worse. You might have a lot less money than you predicted.
PRIME MINISTER:
Well, that is all the more reason why people should support our
plan. See, a government that comes along and says to you, look,
you can have all of these goodies without making any change, you
can have all the lolly without the vegetables, you can paint the
house a nice new colour without doing anything about the cracking
foundations I mean, what is wrong with the Beazley approach
is that he does not accept that the system needs change. Everybody
knows that the present system is falling over on its legs.
SATTLER:
Okay, Prime Minister.
PRIME MINISTER:
And we've got to change it for the better.
SATTLER:
I don't think you have to convince too many people of that,
but when you announced the tax package...
PRIME MINISTER:
Well, I'm encouraged to hear that. I think I have, over the
weeks and months ahead, to go all around Australia explaining that
you can't have the good bits, you can't have the easy
bits without doing some of the hard bits.
SATTLER:
Well, we're prepared for a bit of pain but we'd like
to be a bit better off too.
PRIME MINISTER:
Of course and you will be.
SATTLER:
Okay, but a few little cracks are starting appear because when
you announced the tax package the Treasurer said education will
be GST free. Now, that's not true, is it, what about computers,
school stationery, uniforms, are they going to be GST free?
PRIME MINISTER:
No, the situation is that the...
SATTLER:
They're part of education.
PRIME MINISTER:
No, well, hang on, no, look, the provision of education services
are free of the GST and that has been defined in the package. But
obviously if you have to buy uniforms, that's not part of that
exclusion but, of course, bear in mind that the people who are buying
those uniforms will be better off under the plan because of the
personal income tax cuts. An average family will be between $40
and $50 a week better off as a result of the tax plan. And don't
assume that you are putting 10% on top of everything else. I mean,
at the present time you've got all these hidden taxes. I mean,
did you know that pet food was taxed at 22%, toothpaste, shampoo,
soap and other powders, wheel barrows, lawn mowers, ladders, garden
equipment, children's toys...
SATTLER:
I've got the full list...
PRIME MINISTER:
Well, I mean, I think people should be aware of this. I mean, they're
carrying on about I mean, at the present time Mr Beazley
is defending a tax system that imposes a 22% tax, a 22% tax on children's
toys.
SATTLER:
Wholesale tax, yeah.
PRIME MINISTER:
Yes, a wholesale tax umbrellas, hand bags and luggage. And
at 32% you've got clocks, watches, TV sets, video recorders.
And at 12% you've got things like Cadbury's family blocks
and Peters Natural Ice Cream. I mean, that is almost unbelievable.
Now, okay, that has been there for 40 or 50 years and what we want
to do is to sweep all of those higgledy-piggledy, uneven taxes away
and replace them with a single rate tax of 10%. And that's
why the price of many things will come down while the price of others
will go up and the average price increase will be about 1.9%.
SATTLER:
Okay, what about charities, they are also supposed to be quarantined
from the tax. Will the clothes they sell to the poor be free of
GST?
PRIME MINISTER:
Well, it's subject to two considerations. There's the
total turnover and if it's below a certain level, well, it's
not in the system. And also there's a test of whether it is
in commercial competition. See, our view is that the straight charitable
activity should be free of the GST, and that is the position, but
where you have the situation that, for example...
SATTLER:
St Vincent de Paul.
PRIME MINISTER:
...well, a church or an agency may be conducting something which
is in straight out competition with somebody in small business,
there is an argument, once it goes over a certain level of turnover,
there is an argument that that should be within the system. And
I think that is a defensible argument.
SATTLER:
Okay, so you haven't really made up your mind about that yet.
PRIME MINISTER:
We have made up our mind. I've just stated what the principle
is. The straight charitable activities are completely free of GST
but where there is a commercial component over a certain level then
it's part of the system and why shouldn't it be?
SATTLER:
So the St Vincent de Paul's shop would charge a GST.
PRIME MINISTER:
Well, it depends on what arrangements they make and what the turnover
of each outlet will be. If it's below a certain level, it's
not caught. If it's above a certain level and it's in
commercial competition then it would be.
SATTLER:
Is there any compelling reason to go back to Parliament next week?
PRIME MINISTER:
Well, Parliament is scheduled to meet and that's all I'm
saying.
SATTLER:
Tim Fischer has said there's really no business that necessitates
going back there.
PRIME MINISTER:
Well, Parliament is scheduled to meet and I'm not saying any
more on that and there's really nothing to be gained by further
questions on it.
SATTLER:
Okay, are you worried about the Government being exposed to further
criticism in Parliament over the $10 million plus taxpayer funded
commercial campaign on the tax package?
PRIME MINISTER:
Absolutely not. We've been told by the law offices, we've
been told by the Department of Finance and Treasury that it is completely
in order.
SATTLER:
Why didn't you subject it to the Auditor-General before you
actually put it on?
PRIME MINISTER:
Because there was no need for us to do it because we got legal
advice that it was completely in order.
SATTLER:
Didn't you say you would run it pass the Auditor-General in
1995?
PRIME MINISTER:
No, no, no, what we did, Howard, was this. We got advice before
we embarked on it from the law offices and from the Department of
Treasury and the Department of Finance. I mean, we are being attacked
by a Labor government who ran those Bill Hunter ads. Remember Bill
Hunter?
SATTLER:
Mmm.
PRIME MINISTER:
I mean, on Working Nation. Those things were running right
up until the calling of the last election and some of them actually
ran after the election had been called, perhaps not those particular
ads, but some others certainly did.
SATTLER:
Did you attack that at the time?
PRIME MINISTER:
We are completely satisfied that this is a perfectly legal operation.
People are saying to us they want information, it's a new plan
and they want information. The thing that appeals to people most
about this plan is not so much how it affects them, they think it
is good for the country.
SATTLER:
All right, the Prime Minister's here and he's agreed
to talk with you. If you want to give him a call, 9221 1233. We
will return momentarily.
[COMMERCIAL BREAK]
SATTLER:
The Prime Minister's in town and he's with us here in
the studio taking your calls 9221 1233. Neil, you're
the first cab off the rank, good morning.
CALLER:
By gee, that's about the first time this has happened, Howard,
I must have been sleeping in all those other times I could have
been on.
SATTLER:
Well, the Prime Minister's a good sleeper, we've just
found that out this morning.
CALLER:
Yeah, well, he's come back over to God's country over
here, Howard, so I'd just like to pass on and say welcome back
to the West, Prime Minister.
PRIME MINISTER:
Thank you, I'm a regular visitor.
CALLER:
Yeah. Prime Minister, I'm a voter who's been looking
at what the benefits are of this tax package as to my family. You
have explained in recent media releases about where the reduction
or where the implementation of a tax benefit is to families. I just
would like to ask you, as the Prime Minister, that Mr Beazley has
said that he's proposing a $50 to $60 a week tax cut to low
and middle income earners, could you explain to me where Mr Beazley
proposes to get this money to continue on with the cuts?
PRIME MINISTER:
Well, I won't know the full extent of his promise until I
hear it but let's assume it's roughly what's been
in the papers. The answer is, I can't explain to you how it
will be sustainable. The difference between Mr Beazley and myself
on this issue is that we are honest enough to say to the public
that you can't have tax benefits without tax reform. You can't
insult the intelligence of the Australian people and say, we can
give you all these goodies without fundamentally fixing the system.
I mean, you've got to believe in fairies at the bottom of the
garden to believe that with a system as ramshackle as Australia,
just a personal tax bribe of $50 or $60 even is going to last, is
going to be believable. I mean, we are offering personal tax cuts
in the order of $40 to $50 for many average Australian families
but it is built on the sure foundation of lasting tax reform. I
mean, we're honest enough to fix the system. Mr Beazley knows
the system is rotten, 80% of the Australian people know the system
is rotten. We are prepared to fix the system as well as offer tax
cuts. Mr Beazley is trying to kid you that you can have the tax
cuts without fixing the system. He said that in '93 and he
dishonoured the commitment when he got in. He increased every indirect
tax he could lay his hands on, gave the pensioners no compensation
and he's going to do it again.
SATTLER:
Ron, hello.
CALLER:
Good morning.
SATTLER:
Good morning, the Prime Minister's listening, Ron.
CALLER:
Oh, good morning, Howard, and good morning, Prime Minister.
PRIME MINISTER:
Good morning.
CALLER:
Prime Minister, I'm on a superannuation pension and my tax
rates are going to come down to a 17% rate. What I'd like to
know is, I'm on the Commonwealth Assistance Scheme, will I
eligible for that bonus for self-funded retirees?
PRIME MINISTER:
Oh yes, oh yes.
CALLER:
Oh great.
PRIME MINISTER:
Yeah, I mean, there are actually about ten individual things that
benefit self-funded retirees and pensioners. You've got the
4% increase in the pension. You get a $250 increase in the tax rebate
for aged people, if I can put it that way, of $350 for a couple.
If you're on the pension, you get a 2.5% increase in the income
test free area and if you are on a pension then there's a reduction
in the taper rate from 50% to 40% - that's the rate in which
your pension disappears as your private income rises. As you've
already indicated, you get the personal tax cut. You get a $1000
savings bonus for all people over the age of 60 and then you get
an additional $2000 savings bonus for self-funded retirees of pensionable
age if their income is either below $20,000 or phasing out between
$20,000 and $30,000. If you happen to own any shares and you're
getting dividends which are franked to the tune of 36 cents in the
dollar, that's the company tax rate, and your tax rate currently
is only 20 cents in the dollar, you can get, for the first time,
a refund of that 16 cents from the tax man. If you've got private
health insurance you get 30% of the cost of that back from the tax
man, irrespective of your income, and for a lot of self-funded retirees,
the abolition of provisional tax. The abolition of provisional tax
is something people like.
SATTLER:
Hello, Andy.
CALLER:
Yes, Howard, and Mr Premier.
SATTLER:
No, Mr Howard.
CALLER:
The Prime Minister said that you get 30% on Medibank Private or
MBF.
PRIME MINISTER:
Yes or any private health insurance premium.
CALLER:
That's the highest [inaudible] for a start.
PRIME MINISTER:
Sorry?
CALLER:
I've been paying for the last 40 years.
PRIME MINISTER:
Yes, so have I.
CALLER: