Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Hansard source

I am always suspicious of simple solutions to complex problems, and the proposal put forward by Senator Bernardi is a doozy. Does the senator realise a lower tax rate equals lower franking credits and less money in the hands of self-funded retirees and those saving for the future? One Nation has already supported tax rate cuts for businesses with a turnover of up to $50 million, but I draw the line at that. What we need are incentives for businesses to invest in Australia and tax rate cuts are not the answer.

Today we have been asked to agree with the suggestion that failure to lower business income tax rates like the United States will mean we are going to be uncompetitive. By that, I mean that existing businesses will leave Australia for countries with lower tax rates or that other businesses will not come to Australia. Foreign owned multinationals don't consider corporate income tax rates in their investment decisions, because they don't expect to pay any tax in Australia. It is just too easy to contrive a paper loss or a non-taxable income. Lowering business income tax rates will not make Australia an attractive destination for investment unless government delivers globally competitive electricity and gas prices. We also need labour reform. We have a $600 billion debt and no prospect of paying it back because this government and the previous Labor government have no appetite to collect tax from foreign owned multinationals which often pay more in political donations than they do in corporate income tax. The truth is Australia could compete for investment if only the two major political parties had the real interests of Australian citizens at heart. Instead, the prefer to spend their time and energy on silly games and pursuing private agendas.

It is an attractive idea to think someone else has already solved Australia's economic problem, but let us be clear: the Tax Cuts and Jobs Act signed into law by President Trump only started on 1 January this year. It will take time to see what it achieves. It does introduce a 21 per cent tax rate at a federal level, but many states in America also have corporate income tax law, so, really, the business tax rate in the United States will be about 26 per cent. A tax rate comparison between countries is ridiculous when the new system in America restricts deductions but in Australia deductions are unlimited. The new company tax system in America provides huge incentives in terms of capital write-offs to encourage things to be made in America.

Central to the reform of the United States tax code is departure from the international tax system, which taxes companies on their worldwide income. The American Congress wants to end the shell game multinationals play so well where profits are moved from one country to another and end up in a tax haven. It is alright screaming for a reduction in Australian company tax, but make it in relation to other countries around the world what they're paying—understand their tax system. I know for certain that most of the senators in this place have no understanding of the tax system and how it works. I am learning. I don't know everything but I have an adviser who has worked in the system for 20 years and I've learnt a lot.