Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

My question is to Senator Carr, the Minister for Innovation, Industry, Science and Research. I ask: can the minister inform the Senate what the government’s tax policy statement Stronger, Fairer, Simpler: A tax plan for our future means for small business—

Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Link to this | Hansard source

Probably insolvency.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

and what specific measures it contains to reduce the complexity of the tax system and provide tax relief for smaller firms?

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

Thank you, Senator Marshall. This is a very, very important question, and I have heard already from the opposition their view about these things. Once again we see them in action: before the question is asked, they of course have the answers. They do not really appreciate that small business is the backbone of the economy; that there are some 2.4 million small businesses in Australia and they generate the jobs and the wealth right across the economy. It is quite clear that the opposition are not interested in their welfare.

Small business is an engine of innovation and a critical source of fresh ideas and new techniques. That is why this government has been working to support and strengthen small businesses since day one. That support continues in the government’s tax plan for our future. This is a plan that includes an early tax cut for small companies which will see a fall from 30c to 28c in 2012-13, two years ahead of a similar reduction in the general company tax rate. This measure will benefit some 720,000 small companies. It will deliver a direct financial benefit and a direct boost to cash flow. Importantly, it will give small companies an incentive to retain profits and to use them to build capabilities and to expand their activities. The government’s tax plan for our future will introduce an instant asset write-off for small businesses. Under this plan, small businesses will be able to get an immediate write-off of items worth up to $5,000. That means that—(Time expired)

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. I thank the minister for that answer and I ask: can the minister explain to the Senate how the measures for small businesses in the government’s tax policy statement relate to other government initiatives to support small business, in particular to support small business innovation, such as Enterprise Connect?

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

This government has made a priority of providing tax relief and of reducing the complexity of the tax system for small businesses. We want to see these businesses prosper and grow, so we want to be able to provide assistance for a company that is providing a machine tool within a factory, if they are a manufacturer; a fridge in a cafe; or IT equipment for an office. That is why the new depreciation benefits will directly flow to businesses such as those.

This is consistent with the objects that we have been pursuing through other activities such as Enterprise Connect, which builds the capabilities of small- and medium-sized enterprises and links them to new ideas. Some 2,700 firms have benefited from Enterprise Connect’s business reviews. Others have received support from Enterprise Connect to make specific business improvements, to increase their research capacity and to access leading-edge technologies. The government’s tax plan— (Time expired)

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a further supplementary question. Again I thank the minister for his answer. Given that Enterprise Connect has been operating successfully for two years, can the minister advise what recent measures the government has taken that will enable small businesses to take advantage of the small business taxation reforms in the government’s tax policy statement to become more innovative?

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

Another longstanding interest, Gav?

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

I am sure Senator Marshall has a longstanding interest in these areas, Senator Abetz. Enterprise Connect is about building small business innovation capacity. Commercialisation Australia is about turning small business inventions and discoveries into moneymaking goods and services. It is about turning good ideas into good jobs. Commercialisation Australia provides support for accessing skills and knowledge, for encouraging experienced executives—actually engaging them by paying CEOs—and for accessing new concepts and early-stage commercialisation activities.

Early-stage commercialisation support is available to firms who are turning over less than $20 million a year, and other components are made available to firms who are turning over less than $10 million. All of these measures come together. The government’s tax plan for our future will create the conditions for increased small business investment in innovation. (Time expired)