David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

My question is to Senator Cormann, representing the Treasurer. Labor has withheld their PVA costings on alternative tax policies. Can you please advise whether the Labor's proposed increase in the legislated small business company tax rate would cost Australians $29 billion over the next decade; whether their denial of deductions for housing investment expenses would cost us $32 billion; whether their increase in capital gains tax would cost us $13 billion; whether their increase in the top income tax rate to 47 cents would cost us $22 billion; whether their increase in tax on low-income trust beneficiaries would cost us $17 billion; and whether their superannuation tax increases would cost $20 billion? Doesn't this add up to around $5,000 extra tax per Australian over the decade?

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

Senator Wong, a point of order.

Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

My question is whether that question is in order. Mr President, I know you've extended in recent times further latitude than previous Presidents on alternative policies. On that formulation, there is nothing in that question that relates to government policy. It is entirely about alleged opposition policy.

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

Senator Brandis, on the point of order?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to this | Hansard source

The question is plainly directed to the minister's portfolio and every one of the subquestions that Senator Leyonhjelm has asked about has a direct relevance to aspects of Senator Cormann's portfolio.

Senator Wong interjecting—

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

I'm taking your point of order into account, Senator Wong. I agree that the question was directed to the minister representing the Treasurer. The elements do relate to the Treasurer; however, it was directed at the Labor Party's policy. I am in a quandary; however, I will allow the question. But I will reflect upon that. Senator Cormann?

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

I would like to add to the point of order, just to help you reflect on it.

Opposition senators interjecting—

On the point of order: questions can be directed to ministers about public statements that they have made. I have spoken expansively about the devastating effect of Labor Party policy on the economy and jobs, and the question that Senator Leyonhjelm asked goes directly to public comments and public statements that I have made as a minister in the past and therefore is directly appropriate.

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

In any event, I have ruled that I will allow the question to stand. I will reflect upon the six sub-elements that Senator Leyonhjelm asked in the context of his primary question. At the end of his question, there was a calculation that he asked the minister to confirm. I'm going to allow the question, but, Senator Wong, in fairness, I will reflect on that.

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

I thank Senator Leyonhjelm for that very important question. This has again shown how desperate the Labor Party are to hide from the Australian people the devastating impact on the economy, jobs and opportunities of their high-taxing, socialist agenda. We on this side of the chamber are in favour of helping Australians today and in the future to get ahead. Of course, to ensure that they have the best possible opportunity to get ahead, the businesses that employ them have to be as profitable and successful as possible.

So I'm pleased—well, I'm not pleased; it is my sorry duty—to confirm that the impact of Labor's policy to increase taxes on small and medium-sized businesses by rolling back the tax cuts that have already been legislated would be to increase taxes on small and medium-sized businesses by $29.8 billion to 2027-28. I'm sad to confirm that, compared to the government's policy settings, Labor's policy when it comes to business taxation would have the effect of increasing the tax burden on business by $65.4 billion. Just reversing tax cuts for businesses with a turnover of between $2 million and $50 million would increase the tax burden on small and medium-size businesses by $25.4 billion. That would hurt about 6.5 million workers across Australia working for 3.2 million Australian businesses. So that is clearly a very bad policy.

Indeed, Labor's tax on housing investment, by their own numbers in the lead-up to the last election, would increase the tax burden by $27 billion. But there's now a further year that comes into the equation, which is why it would increase the tax burden by $32 billion. It is also true that Labor propose to increase tax on investment, through their capital gains tax changes, by about $13 billion, and it is also true— (Time expired)

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

Senator Leyonhjelm, a supplementary question?

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

Minister, with the coalition's increased Medicare levy and tax hikes on superannuation, smokers, banks, hiring foreign workers and low-value imports, the budget says Commonwealth tax will be more than 25 per cent of GDP in a decade's time compared to 22 per cent now. Doesn't this add up to around $10,000 of extra tax per Australian over the decade? Isn't the coalition turning Australia even more socialist than Labor?

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

(—) (): The answer to that question is no. I have explained this to Senator Leyonhjelm before. Unlike the Labor Party, the coalition has made a commitment not to increase the tax burden in the economy above 23.9 per cent as a share of GDP. That is the same line in the sand—the same cap—on tax as a share of GDP that we have imposed on ourselves in every single one of our budgets. We know that Labor, based on their policy statements so far, are proposing to blow that tax as a share of GDP cap out of the water. Labor are proposing to increase the overall tax burden in the economy, which will hurt investment, hurt the economy, cost jobs and lead to fewer jobs and lower wages. We are absolutely committed to keeping the tax burden as a share of GDP below 23.9 per cent, which is the basis on which all of our revenue forecasts in our budgets are calculated. That is the contrast—23.9 per cent cap on taxes as a share of GDP us and no cap under Labor. (Time expired)

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

Senator Leyonhjelm, a final supplementary question.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

The Liberal Democrats have policy costings published on the PBO website to halve income tax, to abolish fuel, alcohol, tobacco and import taxes, and to cut spending to deliver budget surpluses and a tax-to-GDP ratio of 13 per cent. But, as this compares poorly to China's tax-to-GDP ratio of 10 per cent, can you please accuse the Liberal Democrats of being socialist too?

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

As a result of the decisions that this government has made in relation to expenditure in government, net spending over the medium term has reduced by about $300 billion. That is $300 billion that either we don't have to borrow or will be available to reduce debt once we have returned to surplus, which on current indications is expected to happen by 2021.

I say again: on the coalition side, on the Liberal-National Party side, our commitment is to keep taxes as low as possible but as high as necessary in order to fund the necessary services of government that Australians expect to be delivered by their government—as high as necessary but as low as possible because we are mindful that leaving people with more of their own money helps them to strengthen the economy, strengthen growth and strengthen opportunity across Australia, because people across Australia are better at spending their own money than the government.