Senator JOYCE (Queensland) (9.09 p.m.)—I rise tonight to talk about what a complete and utter muddle the Labor Party’s position on this is. We have just heard the finale: that, in light of current economic conditions, in light of world macroeconomic conditions, the Labor Party is going to bring about a luxury car tax with the Tax Laws Amendment (Luxury Car Tax) Bill 2008. Let us just take this apart piece by piece, because I think that is what is needed. Let us start from the word go with the history of the luxury car tax, which has been espoused so many times but is completely and utterly wrong in what the Labor Party is putting forward. The luxury car tax was introduced by the Hawke Labor government in August 1986. It is extremely important to get that on the record.

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Senator Jacinta Collins interjecting—

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Senator JOYCE—What you had before that—what you are referring to, Senator Collins—was a change in depreciation rates by the Fraser government, but there was no tax. Let us just get it right from the word go. They were two completely separate measures.

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Senator Jacinta Collins interjecting—

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Senator JOYCE—Senator Collins, you should hang around because a lot of this speech is about you. This is the sense of it. We have also heard what Senator Collins talked about at the end. She changed tack halfway through. At the start she was saying that the concept of the luxury car tax and the impending Henry inquiry were disconnected, but then she changed tack towards the end and said they were connected. This is the Labor Party position which they are going to roll out into other areas of people’s lives—a tax on luxury. I find the whole term aggravating—the tax on luxury. Where the Labor Party always fail—they are always absolutely hopeless at it—is in their attention to detail. A typical one is, unfortunately, Senator Marshall saying that the luxury car tax applied to cars—and he was saying something like, ‘You’ve got to get your details right and you’ve got to know what you’re talking about’—worth more than $57,123, if I can remember it correctly, and you can check the Hansard. It is not $57,123; it is $57,180—$57,123 was the previous year.

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Senator Chris Evans—At the time of the budget; we all know that.

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Senator JOYCE—No, it was not stated about the budget. It said that that was the tax, Senator Evans. So you got it wrong, as you get everything you do with detail wrong. You have not got your details right, and that is why your whole economic policy and economic program are so lacking: because you just do not have an eye to the detail. You just cannot get it right. As soon as you get it right, the future of this nation may be in better hands than it is under you. Until you get those finer details right, if you can march senators in here and have them espouse the wrong amount, it shows that you just have not got your finger on the pulse.

Interjection
Senator Chris Evans—So are you a member of the Liberal Party or the National Party now?

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Senator JOYCE—That is, of course, where you go, Senator Evans, because you are so lacking in acumen to find something substantial to pose in an argument. You are now running the nation, you are now the government and you cannot even clearly dictate your own government’s policy in the chamber here. You have to wait for a backbencher to correct you. What does it say about you and where you are? Let us go through a few of the other things. In a simple message, this so-called luxury car tax is actually attacking the cars that Australia produces. We have Senator Carr out there trying to build up the car industry—and rightly so—and, at the same time, your own government, Senator Evans, is inspiring a tax on the cars that we produce.

In the future, the Indians and the Chinese will produce the cheap cars. We will never compete with them. There is an inelasticity in demand, of over 120,000, in the cars the Europeans produce. You are taxing the cars that the Australian car manufacturing industry produces. And, for the life of me, I cannot work out why you would want to do that. For the life of me I cannot work out why you would want to tax the cars that are providing employment for Australian men and women and keeping them in jobs. There is almost pathos in your approach to this policy. Why would you inspire a tax on an area of demand in which people’s response will be to buy a car from another country? Why would you do that? Where did that seed of wisdom come from?

I notice that for every car that Australia produces there will be a version of it in the luxury car tax bracket. I am sure the people of Victoria are going to be absolutely fascinated to hear that the Labor Party is supporting putting them out of a job. This statement almost bowled me over: the tax is to combat inflation. So we are going to put the price of something up to bring inflation down. Who was the economic guru who came up with those words of wisdom? Where did that come from? The whole process is just so moronic. Why would you even bother saying something like that? It is so wrong. But it falls into line with Labor saying, ‘The luxury car tax threshold limits starts at $57,123,’ when it does not.; it starts at $57,180. They do not even know their own policy.

But let us try and make some sense out of this onerous, ridiculous tax. Why on earth is the threshold at $57,180? Even if you wanted to keep to the scheme, to keep to the picture, I think you should have a look at what was presented at the Senate Standing Committee on Economics. The Federal Chamber of Automotive Industries gave some suggestions about what the tax might be moved to so as to keep some semblance of reality. The chamber presented evidence to the committee showing various indexing scenarios for the luxury car tax threshold since 2000. These showed that, while the luxury car tax has increased from $55,134 to $57,180 since 2000, during the same period the threshold would be $71,106 using the CPI, $79, 950 using the average weekly earnings and $63,504 if indexed against the average price of the cheapest ‘family six’. The cheapest ‘family six’ is important to me because I have a family of six.

In a sense, the only thing that you can say is that it is a grab for money, and they are going about it in the most base and simplistic way. It is without any sort of rhyme or reason. This is the form of economic policy coming forth from Labor. People ask: ‘Why are you going to oppose the luxury car tax?’ I will because it is an anachronism. It is a farce. It is a ridiculous compilation of arbitrary ideas with no real purpose, no real meaning and no real substance. That is why I will oppose it. It is not because the Labor Party came up with it; it is because it is a stupid idea. What would be the reasonable approach? A reasonable approach would be for the government to come back and say, ‘We are looking at the CPI; we are looking at the average weekly earnings,’ or to say that they are looking at anything. But they are not. We just have this ridiculous figure plucked out the air that Labor have come up with.

Surely the government would understand that a car over $57,180 is hardly going to be perceived in the community at large today as being a luxury. Even when the term ‘luxury’ is used, it suggests the government are trying to gild the facts. If they just said, ‘This is a tax to help the Labor Party collect money when it cannot think of another idea,’ then they would probably have some sort of position to stand on. But unfortunately the luxury car tax starts