Dean Smith (WA, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | Link to this | Hansard source

As we enter the final moments of the committee stage for this part of the evening, I think it's important to recap what we're being asked to support here. Put most simply, Australian industry suffers from high project costs. Those high project costs are because of high energy costs; those high project costs are because of poor access to land; those high project costs are because of a rigid industrial relations system; and, most particularly, those high project costs that afflict Australian industry, whether it be in the mining and resources industry or the agricultural industry, are because of rigid, unnecessary and, in many cases, duplicative environmental processes. Rather than address, at their core, those contributing factors to high project costs in the critical minerals industry, the government is proposing a subsidy instead. That is this bill in its easiest and most accurate summation.

At this point I think it is very important to summarise exactly why the coalition is opposing this bill. There are five themes that deserve to be re-read. The first is that this is burdensome bureaucracy and inefficient spending. The bill does not provide widespread tax relief to business but instead ties businesses up in complex regulations. We'll come to that in some questions that I have for the minister. Further, businesses must navigate multiple government agencies—including the Clean Energy Regulator, ARENA and the department of industry—before even reaching the tax office, and the estimated compliance cost for businesses starts at $100,000 a year. Those costs are ongoing and will be cumulative.

The second theme is that this bill risks permanent corporate welfare. The coalition supports lower taxes but opposes permanent taxpayer funded handouts for businesses. The bill locks in subsidies for decades, with production tax credits extending into the 2040s. Lessons from the COVID-19 crisis demonstrate to us that government intervention should always be temporary, should always be targeted and should be scalable and not a permanent feature of economic policy.

The third theme is that the unclear and politicised community benefit principles deserve much greater interrogation. Again, I look forward to asking the minister questions about the community benefit principles in practice. Companies must comply with unclear and vaguely defined community benefit principles in order to receive the tax credits, and it's worth noting that the full tax credit is not available unless you meet the community benefit principles in full. That's a very important point that industry must be very cognisant of. Secondly, the Treasurer has sole discretion over the community benefit principles—or requirements—creating, we would argue, political risk and uncertainty for business at a time when business, particularly in the critical minerals sector, is looking for greater certainty and less political risk. Finally, critics warn that the community benefit principles could force businesses into— (Time expired)

Progress reported.