Michael McCormack (Riverina, National Party, Minister for Small Business) Share this | Hansard source

It's always good to follow the member for Fenner, dressed resplendently in his woollen suit—made from wool probably from a sheep raised on a farm in an electorate which was held by a National Party member. I know he's a very good marathon runner, and to run marathons you need to be able to have the food inside you that keeps you running to the finish line—food grown, probably, in one of those National Party electorates that he condemns. There is nothing wrong with National Party electorates getting well-funded so that we can provide the food and fibre that you, Member for Fenner, and everybody else needs. When the regions are strong then so, too, are the capital city electorates just like yours.

The member for Fenner mentioned the imputation system and said that members would be disingenuous if they didn't mention it. If you go to the Australian Taxation Office website, it talks about imputations; it talks about franking; and, importantly, it talks about the prevention of double taxation. It says that that is:

… the taxation of profits when earned by a corporate tax entity, and again when a recipient receives a distribution.

So true. Indeed, double taxation is when a Labor government, like we had when I first entered parliament, goes and proposes a policy and implements it—like the minerals resource rent tax, which was never going to raise any money—and then spends it before the money even comes in, and then, when the money doesn't come in, because it was never going to, they've already spent the money, and they've just added to the debt and deficit. Mr Deputy Speaker Kelly, you know as well as I do, and as every member on this side of the parliament knows: that's what Liberals and Nationals do—we clean up the mess left by those opposite.

I refer to the Sydney Morning Herald article entitled 'Goodbye to the mining tax, and good riddance', written by Elizabeth Knight on 3 September 2014, where it states that:

In isolation, the mining tax didn't raise any funds. However, the previous government—

Labor—

had earmarked the phantom revenue it was to generate from the MRRT to pay for a variety of goodies …

That's what Labor does. They've paid for things long before they've accrued the money to pay for them. It is a form of double taxation because then they have to tax the daylights out of small business and out of good hardworking Australians to make up for their mess.

The Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017 goes to the heart of why taxation cuts are so important for small business.

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

The member for McMahon said that in his book Hearts & Minds, published in 2013—available at all good garage sales! He was right then, and I don't know why he didn't—during the half hour of time which we on this side of the House endured in listening to him just a short while ago—talk about it being a Labor thing now. If it was well and good in 2013, why isn't it good now?

The Liberal and National's plan for a brighter future, for supporting jobs growth, for attracting investment and for creating opportunities for more Australians: that's what the Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill is and will be into the future. It's a 10-year plan for a secure future for our children and generations to come. What could be more important?

As I've gone about the nation on my small-business roadshow—I've visited a number of Labor electorates, too, I might add—I've met hundreds of small-business owners who've backed themselves and risked it all to make a go in business. It's fantastic to see them doing just that. Business creates jobs, not government. It's entrepreneurial spirit. People willing to take that risk are the ones who are creating jobs, not us. We might talk a big game—we might take the credit for it—but it's business people who risk everything, including their houses, to have a go who are creating the opportunities for more Australians to be employed. As we heard from the Treasurer during question time today, there have been more people employed in the past six months than at any other time in recent decades.

Let's be under no false illusions: the road on the path back to wealth and prosperity is not an easy one to navigate. Having run my own small business, as have many of my colleagues, I understand the personal investment and commitment involved to get a business up and running and off the ground. We know that by lightening the load on business, economic activity will increase, including increased investment, employment and wages growth. The Liberal and Nationals government wants to give business the confidence to grow and to invest and to create more jobs for all Australians to benefit.

This bill builds on the vast array of small-business measures the government has delivered. Never has there been a more small-business-friendly government than this one. We've already cut taxes for small businesses with a turnover of less than $50 million, reducing the tax rate to 27.5 per cent, its lowest level in 77 years. There are more than 3.2 million small businesses in Australia, having a go and employing 5.6 million people, who are set to benefit from this bill and other measures that we're putting into place. The response for small businesses has been resounding: 99 per cent of businesses have access to small-business incentives, including the popular $20,000 instant asset write-off, which was extended by 12 months in this year's budget. This popular program supports small businesses to invest in the assets they need while boosting business productivity.

We're cutting taxes and we're also cutting red tape. As part of the budget, $300 million was put on the table to incentivise states, whatever their political persuasion, to get on board and to cut some of that bureaucracy, to cut some of that red tape, to cut some of that overlap between federal and state jurisdictions. Time is money in business, and so we're working with the states and the territories to simplify red tape and streamline services. We've recently passed legislation for fairer competition laws, levelling the playing field for small business and driving competition in the market while also providing better, greater, stronger protections. The Liberals and Nationals want to see businesses grow, and our plan is working to reduce barriers, to stimulate investment and to encourage more investment. We want to see jobs growth and increased wages through tax relief.

I know the member for Fenner doesn't understand that. I know he doesn't get that, but if you put in place tax cuts, businesses profit. They then have the incentive to employ more Australians. That leads to higher wages, which leads to economic growth. Treasury modelling suggests that when the Ten Year Enterprise Tax Plan is implemented our policy to cut taxes to 25 per cent across the board will permanently generate an increase to the economy of more than one per cent of gross domestic product—more than $17 billion in today's dollars each year. They are big numbers. They are important numbers. For a business to pursue a new idea or give someone else a go takes courage. It requires risk. That's why our plan to provide tax relief will back business and inspire confidence to invest and to grow. The National Australia Bank small-and-medium enterprise report released on 5 September said that 70 per cent of SMEs think Australia is a great place to do business. The report shows that SMEs want to grow but are finding it difficult to see through a maze of red tape and regulation. That's why the government has taken action. That's why it's part of the May budget. We incentivised the states to do what they could to remove duplication and compliance for small business. To date we have already cut $5.8 billion between 2013 and 2016, eclipsing our target of a billion dollars per year. We are also making it simpler for businesses to report payroll and superannuation information to the ATO through the Single Touch Payroll. I complement the member for Reid, the assistant minister, who has rolled out the National Business Simplification Initiative in the hospitality sector in Parramatta, reducing the time it takes for the first registration papers to go into ASIC. From the time you decide to start a small business, it used to take 18 months. We've got that down to three months in the hospitality sector. Because it's been such a success, it is going to be rolled out in other sectors in other areas and in other places across Australia.

The NAB report on SMEs also shows that more than 84 per cent of small and medium enterprises believe the government should provide better tax breaks and incentives to small business. We are doing just that. We are getting on with the job. It also shows that almost 37 per cent of SMEs have wanted to expand but have hesitated, 45 per cent citing uncertainty and economic conditions. Australian business can have confidence that the coalition government is delivering its commitment to lower taxes across the board to increase growth and competitiveness. The economy is diversifying and expanding, and the government understands that businesses of all sizes have an important role to play. The tax cut that we've already delivered is a good start. The passage of this bill seeks to lower the company tax rate to all businesses and that will provide another boost. As I said, we are getting on with the job.

Over a decade, this bill will lower the tax rate for all businesses to encourage investment and higher paid jobs by progressively decreasing the tax rate for all businesses to 25 per cent by 2026-27. We have to do this to remain internationally competitive, to take advantage of the Asian century and to make sure that we're right up to speed with our competitors and with those with whom we trade. Our plan to lower taxes has received wide support from business and industry. Ai Group Chief Executive Innes Willox in a survey of members released on 5 May said that tax relief is top priority. The survey gave top ranking to reducing the burden of business taxation and showed that, '54 per cent of business leaders give top or second-highest ranking to the reduction of the small business tax burden. This is an unambiguous expression of support for the government's enterprise tax plan.' I couldn't have said it better myself.

The Business Council of Australia Chief Executive, Jennifer Westacott said:

It’s imperative that the parliament passes the Enterprise Tax Plan in its entirety to restore Australia’s company tax rate to the middle of the pack and protect and grow jobs in this country.

Again, I couldn't have said it better myself. We want to encourage investment and for more Australians to back themselves and follow their business dreams. Our plan supports them to make those dreams, those aspirations and those hopes a reality.

On the other hand, what do we see? A Labor Party that is antibusiness and beholden to the union agenda. Labor's reckless attitude to spending will be funded by taxing small business at every opportunity and ripping money out of the pockets of hardworking Australians. Labor counts the cost of the enterprise tax plan in its savings figures—that's what they do. We all remember, just prior to the last couple of elections, Labor putting in savings measures and going to the electorate saying that they were going to put in place savings measures if they were elected. And what did they do? They then opposed them in the Senate. They opposed them in this place when we said, 'Look, let's do it. Let's go with your savings measures.' They don't want to do it. They count the cost of the enterprise tax plan in their own savings figures. Australian small business can only assume that Labor is taking a backward step, as per usual, and redefining small business to that of a turnover of $2 million and not what we've got it at now of $10 million.

Under Labor, Australian families and businesses will be hit with more than $150 billion worth of taxes. Labor views small business turnover as a river of gold from which they can fund their tax and spending ideology, hurting business and our economy. No-one is safe from Labor's tax grab. There will be tax upon tax upon tax to fund their spending addiction. Under the Labor alternative, tax cuts for small business will be under siege. The instant asset write-off will probably be gone. Family and small-business trusts are also under siege. We heard the member for Fenner condemning trusts. But we expanded it. We extended it in the last budget and, let me tell you, Australian businesses love it.

Mr Thistlethwaite interjecting—

They love it, member for Kingsford Smith. We heard the member for Fenner talking about negative gearing as if it's something that shouldn't happen. He wants to pull the rug out from under the housing market—so typical. What Australian small businesses do not need is another policy from Labor that will put pressure on budgets, stifle growth and destroy confidence, because confidence is what courses through the veins of small-business owners. Confidence is a perception, but it's also a reality and, let me tell you, the member for Maribyrnong is pro union and anti business. If he ever becomes the Prime Minister of this country then pity help the small businesses, the medium enterprises and the farmers in your electorate and mine.

Unlike the coalition, Labor is made up of former union officials, not businesspeople. They don't understand it. They don't care. Only half-a-dozen of Labor's MPs have actually run a small business, and that's the shame and pity of it all.

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