Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Small Business and Minister representing the Assistant Treasurer, Senator Sherry. Can the minister advise the Senate what priority the Gillard government will give to Australia's small businesses when using the proceeds of the minerals resource rent tax to deliver the benefits of the mining boom to all Australians? How will ordinary taxpayers also benefit from the reforms to deliver a simpler and fairer tax system? What would happen to these historic reforms in the absence of the MRRT?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

Thank you, Senator Brown. The government is committed, as I have said on a number of occasions and as other ministers have said, to ensuring the benefits of the nation's mineral wealth do flow to the broader Australian economy and to Australian people and business. It has been sometimes forgotten in the debate about the mining tax that every cent of the revenue raised will be spread across the Australian community, to business and to individual Australians, through a range of tax cuts.

As small business minister I am particularly proud of the initiatives that are being funded from the mining tax in respect of small business tax relief. There will be a significant cashflow boost and a strong boost to investment in productive assets. From 1 July next year small business will be able to claim an instant write-off of the first $6,500 of each and every asset that they purchase. That is up from $1,000 at the present time—$1,000 in asset write-offs to $6,500 per asset. This measure alone will be worth more than $1 billion to small business. It will be funded from mining tax revenue.

Further, around 6½ million Australians will no longer have to lodge a tax return. This is a massive simplification of our tax system. We will be introducing a standard tax deduction of $500 in the first year, rising to $1,000 in the following years. Again, this is funded from mining tax revenue. The two measures that I have mentioned so far—small business tax relief and a much simpler tax claims system—will be of immeasurable benefit to the small business community and the broader taxpaying population. (Time expired)

Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Can the minister outline to the Senate the main benefits of the tax reform package funded by the minerals resource rent tax for low- to middle-income Australians?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

About two-thirds of the 6½ million Australians who will benefit from the new income tax claims system will have a taxable income of less than $50,000. We also should not forget a couple of important superannuation measures. Firstly, we will be effectively abolishing the contributions tax by rebating, for those Australians who earn less than $37,000, the 15 per cent contributions tax that is payable on superannuation contributions. The Liberal-National Party have not signed up to this measure. They have signed up to the superannuation guarantee but they have not signed up to any of these other measures.

Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Shame!

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

It is a shame. They are effectively arguing that taxes on small business should be increased. They are effectively arguing that taxes on superannuation contributions should be increased. They have failed to sign up to these very significant measures. (Time expired)

Carol Brown (Tasmania, Australian Labor Party) Share this | Link to this | Hansard source

Mr President, I have a further supplementary question. Is the minister aware of any alternative policies to the government's tax reform package, a package made possible by the MRRT?

Nick Sherry (Tasmania, Australian Labor Party, Minister Assisting the Minister for Tourism) Share this | Link to this | Hansard source

I have said that those opposite are wedded to reversing the mining tax, but we have seen some shift in opposition position. I notice that just last month Dr Mal Washer, a member of the other place, said:

I think an appropriately applied mining tax is a very good thing.

I think he is from the great state of WA, too. We now have anonymous coalition MPs commenting on this. I see in the media that 'public sentiment had swung behind the mining tax', according to a Liberal MP. When asked why they would support the mining tax, aside from the fact that public sentiment has swung behind the tax, the coalition MP said 'Joe needs the money'—the $11 billion that the Liberal Party wants to give back to the mining community. (Time expired)