Cory Bernardi (SA, Australian Conservatives) Share this | Hansard source

I present this matter of public importance with the concurrence of my colleagues, Senator Leyonhjelm and Senator Anning. Whilst we haven't come to an appropriate name for our taxpayer focused alliance, we are committed to getting better value for money for the taxpayers in this country and we are committed to finding a more efficient and effective way of governing.

Today we're focused on the need for Australia to reduce taxes on business. We have to leave aside for a moment the impost of red, green, and other tape on business and, indeed, the payroll tax and other taxes on jobs. All of this is endemic across the country. But we need to talk specifically about the income tax burden. On this front I have to commend the government for maintaining a commitment to lowering business taxes. It falls to the Australian Conservatives to keep making the case that gives the coalition the backbone and strength to secure truly conservative achievements.

Tax relief for business is a topic I know is attractive to almost a majority in the Senate—almost. Unfortunately, we've missed it by this much. That's the wedge of the Greens and others in the Senate that reject fiscal prudence. Again, as I said on the cashless debit card this morning, we always crash into what I might now describe as the budgetary Berlin Wall: the left-wing barricade in this place that is the Nick Xenophon Team, the Greens and the Labor Party. The real Berlin Wall, as you well know, this week has actually been down longer than it was ever up, but a budgetary Berlin Wall remains here in the Senate, and the bricks are coloured orange, green and red.

Why reduce business taxes? It makes sense for reasons I'm going to outline shortly, but the Trump administration in the United States have done two things. They've led the way with their business tax cuts. They've also put pressure on Australia to follow suit. If we do not follow suit, businesses will prefer to set up in more tax-friendly countries where the markets are bigger and it's more efficient and effective for them to do so. Businesses will go to where they're made to feel welcome. Reduced business taxes lead to increased after-tax profit, which encourages more capital investment. It allows business to increase, update and improve the capital available to their workers. This in turn leads to greater productivity per worker, greater economic outcomes and higher real wages. Indeed, Labor may claim the mythical cigar-smoking bosses will pocket the increases, but with labour mobility workers in a healthy economy will seek better-paying employment if the bosses and not they are enjoying the rewards of their labours.

Lower business tax rates can fundamentally address some of the key ills that have been afflicting our workers, households, cost of living and economy more generally over the past decade and particularly since the end of the mining boom around 2012. These are the very kinds of economic reforms that the Hawke-Keating and Howard government years successfully instituted for all Australians.

Cutting business taxes is the kind of economic reform and mindset this country urgently needs to return to the path of prosperity. We need to return to it today. The budgetary Berlin Wall of Nick Xenophon, Labor and the Greens cannot sustain business tax rates that are now at entirely uncompetitive levels by world standards whilst also pushing instead for artificial hikes in minimum and other wage rates to try and address sluggish wage growth. The evidence of this is apparent to anyone who has run a small business, who has employed people, who understands the economy and how it functions. Unfortunately, there are too few in this place, too few on the crossbenches and too few on the left side of politics who want to confront the reality of what we need to do.

This type of discredited central planning or command-and-control structure never works in the medium or long run. It simply destroys jobs rather than having the tide lift all boats. Of course, the current opposition aspires to hold government, and their ideological followers from the Nick Xenophon Team and the Greens simply don't seem to care about the medium or long term. The political Left want the short-term sugar hit of populism in order to reclaim power, to centralise more power within their ranks and to move across to the government benches by winning the next election.

Higher business tax rates are a disincentive for our young people trying to get jobs, they're a disincentive for businesses to invest in this country and to continue to reinvest in this country, and a they're a disincentive for mums trying to re-enter the workforce. Wage increases can only be sustained if they are driven or underpinned by similar productivity improvement. Otherwise we all suffer—particularly our young people seeking a chance to get their first job or to move into a better-paying job.

The reality is this: the more businesses we have competing for labour in the market, the more people we will have employed and the more attractive it will be for an employer to pay them higher wages in order to meet the competitive demands. I know that, as an employer in a small business, you do whatever you can to keep your good employees, whether it's giving them additional benefits, preferential hours or additional wages. But you can only do that if you are making a fair profit. Too many businesses in this country seem to be working for the benefit of the government—working for the benefit of a range of government departments and pen pushers—rather than to the benefit of the economy overall. We need to change that. Cutting company tax and business taxes will be a massive step in the right direction.