Bert Van Manen (Forde, Liberal Party) Share this | Hansard source

It is always a pleasure to rise in this House and speak about the tremendous things that this coalition government is doing to support business and economic growth in this great country. I rise to speak today on the coalition government's plan for greater investment and more jobs through the Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016.

Reducing the amount of tax that business pays, through this enterprise tax plan, is designed to help 1.8 million Australians who are looking for extra work to boost their take-home pay—and not only to boost their take-home pay. For those who are presently employed, there is the understanding that the businesses they work for are more stable and more financially secure and that that improves their job security and their prospects for the future.

The concept is simple, albeit that those opposite do not seem to be able to grasp that concept so well. It is that business paying less tax frees up their money—and this is the important aspect: it is their money—to pay employees more and to give them more hours of work, and to invest in new equipment and to grow their businesses.

It is important that, as a government, we continue to ensure we have a long-term, sustainable, social services security net for those in our community who are genuinely in need, including funding for health and education and the welfare budget. This will help those people in the community who need that hand up. But these important measures in this space cannot be achieved without having a strong economy, and to have a strong economy we need strong businesses of all sorts but in particular small business. To improve this, we are looking to reduce the tax burden on these businesses so that there is more money to employ people and to increase their hours of work and pay. This is why we do need a company tax cut.

Those opposite have rejected the enterprise tax plan and want to deny small business and their hardworking employees access to further investment and growth opportunities. If those opposite get their way, our economy and the hardworking people in it will be the worse for their actions.

Compared to many countries around the world with which we compete on a daily basis, we are now seeing that our corporate tax rate is coming to be at the high end of rates globally. And corporate tax rates which are increasingly uncompetitive are going to make it harder for Australia to continue to attract the necessary investment. This is important because we, as a nation, have had a history of requiring external capital investment in our country to grow and develop. That ongoing investment is one of the key drivers of growth in our economy, while company tax paid by companies is ultimately a burden that is passed on to consumers and employees. A more competitive business tax environment will lead to or encourage high levels of investment in Australia—or, importantly, will retain the existing levels of investment in this country, because, as I said before, as a net importer of capital, we need to ensure we have a competitive framework to attract and, importantly, maintain that capital.

This is especially important in the current environment where we have falling or plateauing levels of private investment, as we have made the transition from the mining investment boom to broader-based economic growth. This increase in investment will benefit all hardworking Australians, not only those directly employed by those businesses but also those who are customers of or suppliers to those businesses, through an improved range of products and the purchase of new equipment. It is the flow-through and multiplier effects of this investment through our economy that do such a great job in growing the economy through a broad range of businesses. That is the value of this enterprise tax plan.

And the big winners out of this plan are Australia's small businesses and those hardworking mum-and-dad businesspeople who are having a go and making an enormous contribution to our economy. Small businesses in Australia employ more than three million workers and, in 2013-14, added some $340 billion to our economy. Australia needs our small business sector to succeed. It is the home of enterprise and opportunity and often the place where big ideas begin.

Leading into last year's federal election, the coalition government provided its vision for the future of Australia, and that vision was to see our great nation grow and prosper and to give every opportunity to Australians to excel. When we shared our vision for Australia, we also presented our plan for that vision, and the Australian people endorsed our plan and returned us to government so we could see it through. With our government's major plan to grow the economy and create more jobs, we promised to stimulate small business by cutting the company tax rate to 27.5 per cent for businesses with an annual turnover of less than $10 million.

Many of us in this chamber have small businesses in our electorates. In my electorate of Forde there are more than 15,000 small businesses. Reducing the company tax rate for these 15,000 small businesses in Forde creates a tremendous opportunity for these small, and in many cases family, business operators to grow and develop their business. It reduces financial pressures and gives them the cash flow they need to reinvest and grow their business. As I said before, this money is not the government's money; it is the money of these business people. It is money that they and their employees generate through their time, effort and ideas. Reducing the company tax rate means the difference between a business potentially stagnating or using that opportunity to reinvest and purchase new assets that help grow the business, new plant and equipment. It means the difference between potentially struggling to manage current operations and expanding their workforce to improve customer service, product development and business turnover.

My electorate of Forde, located in South-East Queensland, is one of the fastest growing regions in Australia and one of our most prosperous areas is the Yatala enterprise area. The businesses in the Yatala enterprise area are of a wide variety, large to small. They produce a range of products that many would never hear about because they go into some other bigger product. Our population is growing, new homes are being built and our road infrastructure is getting busier. It is why we need growth in our business sector: to provide the government with the revenue and funds necessary to be able to build the infrastructure and services we require to support this growing community. The government needs to support this growth. We want to see our electorates prosper, and this is what this enterprise tax plan is designed to do.

The coalition government recognises that business taxes represent a higher cost for small business, which is why we will reduce the tax burden on small business first. Since many small businesses are not companies, the government will extend the unincorporated small business tax discount from 2016-17. The discount will be available to businesses with a turnover of less than $5 million, up from the current threshold of $2 million, and will be increased to eight per cent. Further support will be provided for small businesses to expand and create jobs. Access to a number of tax concessions will be provided by increasing the threshold for those concessions to $10 million, up from the current threshold of $2 million. These changes alone will benefit over 90,000 small businesses in Australia.

I am proud to say that the many hardworking small business owners in my electorate of Forde are ready to embrace these opportunities that these tax concessions will provide. For some it will mean investing in new equipment, expanding their workforce or taking on trainees and apprentices, for others it will mean investing in marketing, improved technology or expanding into the international market. However these businesses decide to reinvest their hard earned dollars, it means more opportunities for Australians. This is the value of the enterprise tax plan and why is it so important that this enterprise tax plan passes the parliament.

What is the alternative? Well, there isn't really one from those opposite, other than higher taxes for hardworking Australians and small business people. Those opposite have rejected our enterprise tax plan and want to deny small businesses and their hardworking employees' access to further investment and growth opportunities. This is despite the fact that the Leader of the Opposition said in 2011:

Cutting the company income tax rate increases domestic productivity and domestic investment. More capital means higher productivity and economic growth and leads to more jobs and higher wages.

This was despite the shadow Treasurer writing in his book:

It's a Labor thing to have the ambition of reducing company tax, because it promotes investment, creates jobs and drives growth.

I find it fascinating that those opposite now consistently claim that we do not need the enterprise tax plan because education will deliver a bigger and more immediate economic benefit. The problem with that is that if we want education to deliver those benefits, then those people who are educated need a job. If we do not have lower taxes and create the opportunities for businesses to grow, develop and prosper and if we do not have jobs, then what are they going to use their education for? This is why it is so important that this plan is passed in this parliament, so it creates the opportunity and the incentive for business to grow, prosper and develop. It will provide opportunities for employers to invest in their businesses; it will give businesses the certainty they need to make long-term investments. That certainty also creates the opportunity for business to grow, because the business owners have a confidence in investing that capital. It also gives foreign investors the opportunity and the security they need to make long-term business decisions.

It is only the coalition government that has a plan to support business growth and economic development. We are supporting Australians who want to work more hours, we are supporting Australian who want to earn more and we are supporting Australians who care about securing their future. The government's enterprise tax plan will boost the Australian economy and we will see benefits in every electorate, in every home and in every business. I commend this bill to the House.

Debate adjourned.

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