PRESS DIGEST-Australian General News - May 18

Compiled for Reuters by Media Monitors. Reuters has not verified these stories and does not vouch for their accuracy.

THE AUSTRALIAN FINANCIAL REVIEW (www.afr.com)

--The Federal Opposition's proposal to raise the taxation on cigarettes would save A$3.297 billion less over 10 years than the previously calculated, according to the Rudd government. The Coalition proposed the tax increase as an alternative to the Government's private health insurance rebate. However, the Government claims that modelling used for Coalition's proposal did not take into account the expected decline in smoking by Australians over the next decade. Page 1.

--The Australian Taxation Office (ATO) has launched an investigation into the administration of trusts, which are seen as complicated and arcane, according to tax experts. Discretionary trusts will be the main focus of the review, with the ATO to look at whether capital gains should be taxed at the highest marginal rate or be subject to a 50 percent capital gains concession. "We need a circuit breaker in terms of a fresh rewrite [of the laws] in a simplified form on the way trust income is taxed," says Paul Brassil, of law firm PricewaterhouseCoopers. Page 1.

--Agribusiness investment manager Great Southern (GTP.AX) has collapsed with debts totalling almost A$700 million. The West-Australian company was placed into voluntary administration yesterday and is considered a major blow to the agribusiness sector following last month's collapse of rival Timbercorp (TIM.AX). The board had been attempting to raise funds and sell assets prior to its collapse, according to Martin Jones, of administrators Ferrier Hodgson, maintaining that the "decision was not taken lightly," Page 1.

--Greens candidate Adele Carles has ousted Labor from its long-held seat of Fremantle, in Western Australia (WA), putting further pressure on Labor leader Eric Ripper to resign. Ms Carles won the seat, which has been in Labor hands since 1924, with 44 percent of the primary vote. Mr Ripper maintained that he had "the overwhelming support of my caucus colleagues." However, speculation is mounting that Mr Ripper, who lead Labor to a shock state election loss last year, will now be replaced, according to commentators. Page 4.

THE AUSTRALIAN (www.theaustralian.news.com.au)

--West Australians have rejected the permanent introduction of daylight savings for the fourth time in 34 years. The state held the referendum on Saturday, following a three year trial, with rural voters making up the vast majority of the 55 percent who voted against the change. Premier Colin Barnett, who voted in favour of the change, conceded that the issue was not "life-or-death," saying that "for this generation there will be no daylight saving." Page 2.

--Australian National University (ANU) and University of Sydney researchers have found a correlation between men's height and income, with every two inches of height worth A$950 per annum. "The wage gain from another 2 inches of height is approximately equal to wage gain from one more year of labour market experience," says ANU professor Andrew Leigh. The correlation is also constant across other wage-influencing factors such as education, experience, race and age. Page 3.