David Bushby (Tasmania, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Finance, Senator Cormann. Can the minister outline what the government is doing to grow the Australian economy, encourage investment and create jobs?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Bushby for that question. The short answer is that the Turnbull government continue to implement our national economic plan for jobs and growth, and a key feature of that plan is to ensure that Australia can again have an internationally competitive business tax rate. That is because on this side of the parliament we understand that, if we want more jobs, we need to ensure that the businesses employing Australians can be as successful and as profitable as possible.

The Labor Party talks about jobs; we actually want the economy to deliver more jobs. We want Australians to have the best possible opportunity to get ahead. Jobs do not grow on trees. Jobs are created by successful, profitable businesses. By helping ensure that we have a more growth-friendly tax system, by helping ensure that businesses can keep more of their own money, not the government's money—when Senator Cameron talks about 'government giveaways', he is assuming that this is all the government's money—we are saying that we want to allow businesses across Australia to keep more of their money so that they can reinvest it in their future success so that, as they are more successful, they can employ more Australians and pay them better wages.

In the end, the only way you can have more jobs in Australia is if the businesses of Australia can be more successful. If we want to ensure that the businesses across Australia can be as successful as possible, we need to ensure that they can compete with businesses in other parts of the world. Now, 4.4 million Australians are employed by businesses generating turnover of up to $50 million. These are not multinational businesses; these are businesses in our communities that are employing 4.4 million Australians. By supporting a more competitive business tax rate, you will help secure their jobs, and you will help ensure they get better wages over time.

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Bushby, a supplementary question.

David Bushby (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Why is it so important that the government reduce the tax burden on business to grow the economy?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

For the Australian economy to continue to grow, we need to continue to attract investment. While in the past our corporate tax rate has been internationally competitive, we are now towards the bottom of the pile. There are only five countries in the OECD out of 35 that have a higher corporate tax rate than Australia. One of them, the United States, has already flagged that it will reduce its corporate tax rate from 35 per cent down to 15 per cent. The average across the OECD is actually 25 per cent.

If the parliament were to support the 10-year Enterprise Tax Plan of the Turnbull government, it would take us 10 years to get to the average position of OECD countries. We would not be at the head of the queue. We would not be right up there in front of the queue leading the charge in lower corporate taxes. We would be middle of the road. Australia as an economy needs to continue to attract investment. We cannot afford to not be in a competitive position with other countries in the world when it comes to attracting capital investment. (Time expired)

Stephen Parry (President) Share this | Link to this | Hansard source

Senator Bushby, a final supplementary question.

David Bushby (Tasmania, Liberal Party) Share this | Link to this | Hansard source

What else has the government been doing to make our company tax system fairer and more competitive?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The government is cracking down on multinational tax avoidance to ensure that businesses that generate profits here in Australia pay their fair share of tax here in Australia, consistent with our laws. That is of course why we passed antiavoidance laws back in December 2015—which Labor opposed, incidentally—which have given additional powers to the tax commissioner not only to impose increased penalties but also to see through contrived business arrangements which saw businesses divert profits into other jurisdictions.

I am pleased to report that our laws which Labor opposed, our laws designed to crack down on multinational tax avoidance, are actually working. For example, Facebook are now booking their Australian revenue in Australia, not in Ireland. Google have also changed their arrangements and restructured to repatriate profits to Australia. But of course we have not stopped there. The diverted profits tax legislation currently before the parliament puts a new tax on profits— (Time expired)