Richard Colbeck (Tasmania, Liberal Party, Shadow Parliamentary Secretary for Fisheries and Forestry) Share this | Hansard source

Partnerships and sole traders—they do not get a tax break out of this. In fact, they potentially get a tax increase. The 65 per cent to 70 per cent of small businesses which are not company structures potentially get a tax increase because the 25 per cent entrepreneurs tax offset is gone under this piece of legislation. The 25 per cent entrepreneurs tax offset disappears under this piece of legislation—another truth. So rather than getting a tax cut as a small business, they get a tax increase as a small business—because they lose the tax offset which was part of the Howard government's 2004 election policy. That demonstrates the attitude of this government to small business—small businesses are the ones they get their union mates to go around and attack, trying to turn them around and change them into a different form of business. That is what happens to those small businesses, that 65 per cent to 70 per cent of small businesses which do not get any benefit out of this process.

The government also tried to tell small businesses and the employees who work in them that this process is going to fund an increase in the superannuation rate. But this process is not going to fund an increase in the superannuation rate; the employers are going to fund an increase in the superannuation rate. That is the truth of this legislation. The employers will fund it or, in some cases, it will be the employees of the business who will suffer a reduction in salary increases as a result of the increase in the superannuation guarantee. That might be a small percentage, but it is going to happen.

In fact that is what Henry said. That is what the Henry tax review, where this whole process started, said. The recommendation from the Henry tax review was to leave the superannuation rate at nine per cent. So the government cannot come in here and argue that Henry supports the mining tax on one hand because on the other hand he was making a very different recommendation when it came to superannuation.

You might look back and say, 'How do you end up with a decent small business here in Australia?' The answer to how you end up with a decent small business in Australia is to start with a big business and put this lot in government. You only have to look at the steel industry to get a demonstration of that. The two biggest players in the steel industry were worth $8 billion back in February. Now they are worth $3 billion. They have had $5 billion wiped off the value of their shares since February.