Cory Bernardi (SA, Liberal Party) Share this | Hansard source

Yes, we can talk about facts, Senator Lundy; I noticed the interjection there. It is the highest-taxing government. When a government borrows money, it is taxing future generations. And the former Labor government borrowed hundreds of billions of dollars, basically stealing—robbing from our children and robbing from tomorrow's taxpayers—to prop up their spendthrift ways.

Senator Lundy is well known as the minister responsible for signing off on $16 million worth of grants for karaoke machines and various other things in the hours before the caretaker motion went up. There was $16 million for home gym equipment, karaoke machines and coffee machines. There was not even a whiteboard in sight to determine who was going to get them. It was an abject disgrace and an example of the irresponsible spending that has robbed taxpayers of prosperity into the future because the former government could not bear to make the difficult decisions.

But thank you for your contribution, Senator Lundy. I look forward to you explaining to the parliament exactly why you thought it was okay to overspend with your grants on karaoke machines, coffee machines and home gym equipment just to prop up Labor electorates. It was a disgrace, Senator Lundy. I know you are embarrassed about it. I know you are, but, nonetheless, you should have had more dignity as a minister than to fall into that trap just moments before the caretaker provisions came in. That is simply illustrative of the spendthrift nature of the former government.

It is important that we recognise now that the new government understands that businesses create employment and promote economic growth. The government can provide the economic environment for that to take place. The fulfilment of these objectives is significantly impaired when government makes it harder for businesses to employ people by imposing an unreasonable level of taxation. The coalition is acting to reverse the infiltration of the draconian taxes that Labor implemented during its time in office.

Not only would I suggest that this tax we are dealing with is harmful to our economy; the revenue it has raised is severely—and I am being very charitable there—below the estimates. The fact that revenue projections have been trending downwards since 2010 indicates the minerals resource rent tax's failure as a revenue raiser. Since the Labor-Greens mining tax was implemented and, prior to that, the idea of a resources super profits tax was first floated those opposite would routinely remind us that mining companies should have to share the fruits of their labour with the Australian people. This is another example of the left of the political spectrum redefining reality to suit whatever position they have themselves.

The former government claimed that a legislative response was necessary to ensure that miners paid their 'fair share' to spread the benefits of the mining boom. But they conveniently ignored our Constitution, which states that state governments have ownership of the minerals and resources that lie under our ground. The royalty system implemented by state governments is a means of charging for that one-off extraction and use of those minerals and resources. This has been around since well before the Commonwealth. This has been the responsibility of the states. The Commonwealth got its share of the benefits from the profits that were generated. The states would receive revenue from the mining royalties in place and the Commonwealth would receive it from companies' tax.

But apparently somewhere in those clearly delineated responsibilities and rights the former Commonwealth government decided they wanted more than their fair share and were prepared to penalise the states in order to get it. It was a ridiculous idea, quite frankly, that suspended the understanding that has operated in this country for over 100 years. It was drawn up by the Australian Labor Party so that they could get more of the money in their hands than the states. Of course, it left the states in an unenviable position. It was ill-considered policy. It was typical of the last six years of government in this country before the previous election.

The ability of the states—and this is important to remember—to levy mining royalties is well established. It is established through the Constitution. It is recognised that the states own the minerals beneath our land, and yet that was not good enough for the former government. They could not have consciously overlooked this; they chose to proceed with the implementation of this ill-conceived tax in spite of this. I feel that that is a betrayal of the states and our system of Federation.

The question then is: why did the former government feel they needed to double up on a policy which was already being implemented effectively by the states by way of their royalty schemes? The answer, of course, is money. With Labor, it always comes down to their irresponsible spending of taxpayers' money. In their desperation, they cast their eyes around to look for whatever cash they could get their hands on. The mining tax was simply another tax grab from Labor, who desperately needed the money because of their reckless spending. I will remind this chamber and the Australian people that they had half-built school halls that cost billions of dollars more than they were scheduled to, they had bungled home insulations which cost billions of dollars more than they were meant to and, regrettably, cost four lives as well, and they carelessly and recklessly borrowed hundreds of billions of dollars.

By virtue of their economic illiteracy, they cast their eyes around, desperate for something to bring money in, because Mr Swan—'the world's greatest Treasurer', as was trumpeted for a while—promised time and time again to deliver a surplus. So they looked towards the cash cow and golden goose of the mining industry in this country. They found an industry they could exploit and they cooked up a tax that we will refer to as the mining tax. The Labor Party needed a budget fix, so they looked to the easiest possible solution. That solution was reckless. It was to place an additional tax on the mining industry, an industry which played an instrumental role in saving this country from slipping into recession.

This tax is not about spreading the benefits of mining to the Australian people; it is just another one of Labor's great big taxes that go out of their way to punish successful businesses and enterprises. When families are succeeding, Labor makes it harder for them with things like the carbon tax. When small businesses are prospering, Labor makes it harder for them by introducing bureaucracy and red tape. They followed this traditional formula in coming up with a mining tax in order to punish the mining industry. The class warfare rhetoric about billionaires and people being in their pay, in their pockets, and all of these sorts of things are testament to the fact that success is coveted and loathed in equal measure by the other side. It is okay when one of them makes a success of themselves, but woe betide if someone outside of their little cabal makes some money and provides employment and things for this country. That is when they become a target.

That is what has happened. The Labor Party and the Greens have decided to punish the successful entrepreneurs who were investing hundreds of millions or billions of dollars in this country, as well as the many small shareholders who invest in their companies. Labor and the Greens do not care about the mining tax, they do not care about the mining industry in this country and they do not care about the shareholders. We heard Senator Siewert talking before about how they are foreign shareholders and how some of them are not paying any tax. Quite frankly, we would not get projects that generate huge levels of employment off the ground in this country without foreign shareholders. It is a xenophobic characterisation.

Do Labor and the Greens not want foreign investment in our country? Without foreign investment in this country, we would not have Roy Hill going ahead. That was announced the other day by Ms Rinehart. Roy Hill is going to employ 3,600 people on site next year. That is $8 billion worth of foreign investment from financial institutions, plus $3 billion from foreign corporations—investing in something that is going to provide hundreds of millions, possibly tens of billions, of revenue and taxation proceeds for this country. Yet somehow the Labor Party and the Greens just do not see it that way. They see it as some sort of betrayal of our system.

This is what I think worries the Australian people. They cannot believe that we are confronted with such tribalism and such class warfare rhetoric from 50 years ago. I would expect it from some on the other side who are true to their socialist roots. Senator Cameron, I will acknowledge your consistent advocacy in this. You probably should be sitting with elements of the Greens; I know how close you are to them. But the simple fact is that the country has moved on. The country needs foreign investment. We need jobs and we need investment in this country.

When you penalise successful businesses with ill-conceived taxes, they go and look elsewhere. They look for where else they can invest their money. There are mineral resources right around the world. It is a global industry and they can choose to put their money where they want to. That is what we have seen, unfortunately. We have seen exploration and investment taking place in other countries while we are try to get rid of this tax.

Just as with the carbon tax, the Labor Party have not considered jobs, they have not considered the fallout on Australian families and they have not considered the fallout on investment in this country. This tax has not only damaged us economically; it has added a level of sovereign risk—because, if you change the rules halfway through a project, it does damage credibility. But it has been an absolute, abject failure. This is not only a toxic tax; it failed to raise anywhere near the revenue that they promised it would. Frankly, we cannot trust the Labor Party and the Greens to implement a tax when it raised just a fraction of what it was supposed to raise. It is an extraordinary reflection of just how mired in hopeless lack of vision they are.

We were told initially that mining tax was going to raise $49.5 billion. Then Ms Gillard created the new mining tax, after leaving everybody out except for the three largest miners in the country. This was forecast to raise around $26.5 billion. The question I would posit for the Australian people is this: how much did it actually raise? It did not quite raise the $26.5 billion. In the first six months, it raised $126 million. In net terms, it has raised a grand total of $400 million. Once again, Labor have overpromised and they have grossly underdelivered. I am happy, quite frankly, that they have underdelivered on their taxes, because I think Australians and Australian companies pay too much tax already. I think government should cut its cloth to fit the taxation system that we have and we should not be imposing new taxes.

As part of Labor's record of economic mismanagement and financial incompetence, despite the fact that this tax has failed to raise money on the revenue side, they actually linked it to billions of dollars' worth of extra spending. Unfortunately, this spending will not be able to be offset by the mining tax because of the abysmal lack of revenue that the tax has raised and that, on all indications, it is going to continue to fail to raise. On a fiscal basis over the current forward estimates, the Labor Party is committed to $18.4 billion worth of spending against a tax that has to date raised only $400 million.

Before the election, Treasury predicted that the mining tax would raise just $4.4 billion. Even at that level, there is still a $12 billion black hole that we will save the Australian people by repealing the minerals resource rent tax. It is clear that the mining tax and associated expenditure would put this budget further into deficit over the long term, courtesy of the Labor-Greens alliance and its path of making the next generation pay for the mistakes and indulgences of today.

It must be repealed, along with the other spending measures, to ensure that this does not continue to occur. This tax is so useless that less than 20 miners have actually paid it. If you contrast this with the 145 mining organisations that are forced to comply with the legislation—who submit all the paperwork but do not actually have to pay it—that is 145 mining operations caught up in the red tape and compliance costs associated with the mining tax when they are not making any contribution to it.

Thanks to the Labor-Greens brain trust, they managed to come up with a tax that (1) was unnecessary in the first place, because it ignored our constitutional conventions; (2) raised just a fraction of what was to be expected, despite the ongoing promises; and (3) imposed an onerous regulatory burden on those who did not even have to pay it. It is a rare trifecta of failure.

Repealing the mining tax will mean that businesses, whether they be small, medium or large, will see millions of dollars' worth of compliance costs reduced. Not only is this tax placing an unnecessary burden on mining companies to comply with legislative requirements but to collect it will mean spending millions more. If Australia wishes to have a prosperous economy it is absolutely essential we get rid of the destructive legacy of the Labor-Green government. It needs to be done away with. Part of this involves repealing the mining tax, making sure our mining industry is competitive and willing to expand and, consequently, employ more people. This tax is merely an attempt by the Labor Party to forcibly put its hands in the pockets of businesses that facilitate the growth of our national economy.