Thursday, 16 April 2009

At last a trigger is coming

It has been a while coming but Labor will have its double dissolution trigger soon enough. The resubmitted alcopops tax legislation will be voted down in the Senate whenever the Government chooses to put it to the vote unless Family First Senator Steve Fielding has a surprising change of heart. Not that such a vote is likely to be early. The rather weird way these excise tax proposals work is that the extra tax is collected from the day legislation is introduced in to Parliament not from the day the legislation is passed. Between the introduction and the final vote there can be a gap of up to a year which is what happened to the initial tax increase on pre-mixed spirits contained in last year's budget. 
The hundreds of millions collected over the last 12 months, now safely in the Treasury coffers, in theory should be refunded to those that paid it given that the rise did not become law. The Government, however, will introduce a separate piece of legislation to enable it to be kept instead of being handed back to the spirits industry. This will present the Liberal-National coalition, and Senator Fielding, with an interesting dilemma. Passing this special bill will effectively mean they have supported the tax after all; voting against it will present the liquor industry with a substantial bonus because there is no practical way of directing the money back to those individual consumers who actually paid it. 
And while that is being sorted out there will be no price reduction in alcopops because the collection process will start over again. It has hardly been a victory for the Opposition and certainly not for the spirits industry.
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