Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Hansard source

Mr Speaker, I have been making a point about effective tax rates, but it is not something that is well understood by the member opposite. When it comes to company tax, the mining companies are paying an effective rate of 17c in the dollar as measured against the 30c headline rate. How does that compare with other industries? In transport it is 27c. In finance it is 29c. This is very important to understand because what is the environment we are having this debate in? They are currently opposing our proposal to cut the company rate by 2c. They are opposing that. What they are proposing to do is to increase the company rate. What we have is a situation where they want to increase company tax for all companies with a turnover of over $5 million, so they have to concoct a figure that the effective rate of company tax for mining companies is 27c instead of 17c. This is the very basic point.

They are now so acutely embarrassed because they have jammed themselves into a corner where they are saying that the companies should not pay more tax. Not even the companies are arguing that. When there is an effective rate of 17c for company tax and when they have not been paying their fair share of royalties, the case is there. It is very clear. They can pay more tax, which is why we are going to modernise the tax system and make sure that those that are very profitable do pay their fair share so we can cut the company tax for all companies across Australia.

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