Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

I have come to the House prepared to speak about schedule 8 of the Tax Laws Amendment (2007 Measures No. 3) Bill 2007, ‘Forestry managed investment schemes’, and associated issues. But I was interested in the member for Prospect’s remarks, and I note Labor’s pious amendment. I have always been of the view—and I cannot present myself as a taxation expert—that a withholding tax was exactly that: a withholding tax. In other words, my view has been that it is much the same as an employee’s PAYE contributions. They are calculated as closely as possible to the tax that might be attributable, but a refund is available if those PAYE deductions are in excess of the eventual liability of the taxpayer. I have to assume that the member for Prospect was talking about a rather similar arrangement. The company tax rate in Australia is 30c in the dollar. One must assume that, when we tax the profits of the huge mining companies, the corporate sector and all the other companies that export from Australia, we tax them at 30 per cent. They of course pay these days on a regular basis. They no longer have the privilege of adding it all up at the end of the year and paying it. I think they were initially Hawke-Keating government initiatives.

I was also interested because the member for Prospect happened to make a reference to the Finance Sector Union. When he was holding forth on ‘union bashing’, as he saw it, I was reminded of something that reflects very strongly on any promise that is made in this place by the Labor Party opposition. My recollection is that there was another finance sector union, which may have amalgamated with something else, called the Commonwealth Bank Officers Association. They were deeply concerned about the moves of the then Labor government to sell off the Commonwealth Bank, their employer. They felt more comfortable while it belonged to the taxpayer. Originally a very small proportion was sold and then that was extended to 49 per cent. A letter was written, fairly close to an election, by the Labor Party to the union movement, which promised that under no circumstances would the other 51 per cent of the Commonwealth Bank be sold. No doubt all the union members supported the government. As a result of that they got back into office and immediately announced that they were going to sell the other half of the Commonwealth Bank. So one wonders what you can read into a policy that says: ‘We’re going to make it 15 per cent. We will halve what this nasty government is now doing.’ That seems fairly logical to me, but how much trust can the financial sector and overseas investors have when there is an example of them writing to their own union mates and saying, ‘Under no circumstances will we sell the other half of the Commonwealth Bank,’ and then doing so with alacrity? For the broader tax-paying community, there was a wonderful statement made at about that same time about tax cuts that were in ‘l-a-w’, and they never materialised.

So one might wonder about the enthusiasm of the member for Prospect. I believe his protestations about union influence will only be discovered, whether in government or opposition, after the next election, when the likes of Combet, Dougie Cameron and Bill Shorten take their places here. In fact, I hope the young man still has a place on the front bench when those fellows shuffle themselves into a position there, as they anticipate. Any policy promoted in this place at this time by the opposition will be subject to the review of those and other union bosses who either have decided to jump ship and get a real job or are coming here to protect the species of the trade union movement, which really lost all relevance at the turn of the 19th century. I refer people to my maiden speech, where I quoted the leading left-wing academic in the United Kingdom who made that remark. Having responded to the words of the member for Prospect, my warning to those who are in hope of getting their 15 per cent withholding tax is: do not hold your breath; it might never happen, irrespective of what they say now. They have only to ring up the former executives of the Commonwealth Bank union and say, ‘How did your promise work out?’

I am a significant supporter of foreign investment in Australia, provided they come here, conduct their business and, where they make profits, pay their taxes. A withholding tax has always been a component of money shipped overseas for the good reason that it is a bit late to chase money if the entire profits are repatriated without tax. The following speaker might want to correct me: my understanding of withholding tax is that it is not the overall tax but it might restrict the capital assets of the person or body that is paying. I will give some credit to Keating as a Treasurer: compulsory superannuation funds have now created such huge amounts of money that Australia seems to be having considerable difficulty finding a home for its own money. I get a little disappointed about that because there are better opportunities in Australia for investment. I pick up the paper and find that we have bought Thames Water and toll roads in Canada, and it seems that most of our financial institutions are looking for homes for Australian savings in many parts of the world. The other great advantage those institutions have is that we as a government do not compete with them for savings. In fact, we contribute savings; we put money into future funds and trusts for education. The financial sector has to invest so there is more money for others to borrow and utilise for the promotion of profit and good living standards in Australia.

I did not come to speak about that in particular, but I am not really sure that the member for Prospect knows it all. I have borrowed a bit of money in my time. Like you, Mr Deputy Speaker Causley, I ran a hotel for many years, and we always seemed to have an overdraft of some sort, so I know a bit about that aspect of business—and I think that is important. While we are talking about institutions, profit and the performance of company directors, I thought there was nothing more outrageous than the attack on the broad body of company directors in the ACTU ad where people like them sat around the table and were accused of saying, ‘Blow the workers.’ Those directors are paying a kid I know, who was a track rider, $1,000 a day to work up in the Pilbara as a semiskilled worker—I might add that he is a hard worker—and when his donga was blown away in the recent cyclone he was luckily in Perth. He got a phone call from his boss who said, ‘Don’t go looking for another job; your full wages are available until we get you up here.’

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