Gavin Pearce (Braddon, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer inform the House how the Morrison government's investment incentives and tax cuts are backing Australian businesses to drive our continued economic recovery from the COVID-19 pandemic and, Treasurer, are you aware of any alternatives?

Josh Frydenberg (Kooyong, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Braddon for his question and acknowledge his experience as a farmer, as a soldier and as a strong advocate for his community. I had the opportunity to join with the Prime Minister in visiting the member for Braddon's electorate recently. We went out to the RSL. We did an event with the local community. We went to Blackley irrigation, a small business that is expanding, taking on new people and using the immediate expensing provisions to buy new equipment.

We saw in today's national accounts how the government's measures to promote immediate expensing and investment and the tax relief that we're providing the Australian community is helping to make our economy stronger. In fact, in the last three quarters, we have seen the economy grow by 8.7 per cent, which is the strongest growth over the last three quarters that Australia has seen since 1968, the strongest economic growth in more than half a century. And as Japan, France, the United Kingdom and Germany all contracted over the course of the March quarter, the Australian economy actually expanded. It expanded.

What was particularly pleasing to see in the numbers today was what is happening to investment—dwelling investment, business investment, machinery and equipment. We saw dwelling investment lift by more than six per cent, the strongest result that we have seen in 17 years. We saw business investment increase a bit more than three per cent but, importantly, machinery and equipment was up by more than 10 per cent, the strongest result in 11 years.

What is happening through this recession and the period of recovery after it is businesses are backing themselves. Instead of going on a capital strike, as you normally see through a recession, they're taking advantage of the immediate expensing and loss carry-back provisions that the government put in the budget last year that we extended in this year's budget and they're actually backing themselves. They're also capitalising on the tax relief, the extension of the low- and middle-income tax offset. We saw in these national accounts household income increase by one per cent, with more than $3 billion of tax cuts to more than 11 million people going over the course of the March quarter, and we saw more than 290,000 jobs being created over that period as well. So what we're seeing is the Australian economy capitalising on lower taxes, the Australian economy capitalising on the immediate expensing provisions and the Australian economy delivering more jobs. They're our policies and that's why we're sticking with our plan.