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Wednesday, 13 August 2003
Page: 18406


Mr BALDWIN (3:08 PM) —My question is addressed to the Minister for Small Business and Tourism. Would the minister inform the House how the federal government is helping to reduce the tax burden on Australia's 1.1 million small businesses? Is the minister aware of any recent reports of excessive state taxes and charges being placed on small businesses?


Mr HOCKEY (Minister for Small Business and Tourism) —Thank you to the member for Paterson, himself a former small businessman. Like so many on the coalition side, he has real experience in small business. We still lament the passing from the Senate of Barney Cooney, the last remaining Labor member ever to have worked in a small business. This side of the parliament, the coalition, is committed to reducing or abolishing taxes on small business. That is why we reduced company tax from 36 per cent to 30 per cent. That is why we abolished the debits tax. That is why are abolishing FID. That is why we abolished provisional tax. That is why now, as a result of our tax reforms, nearly 80 per cent of Australians pay no more than 30c in the dollar in income tax. That is why we halved capital gains tax. These are all big wins for small business, and that is because on this side of the House we believe in lower tax for small business.

In contrast, you have to judge the Labor Party not on what it says but on what it does. Only yesterday we saw Bob Carr try to make political gain out of some tort law reform in relation to public liability insurance. The truth of the matter is he did nothing about the state taxes on insurance. All he did was mouth off about some initiatives in public liability that are not going to make an ounce of difference. I challenge Bob Carr to go and speak to the small businesses in Port Stephens or in Newcastle or in Sydney, or to go and speak to the owner of the Big Banana in Coffs Harbour and ask him how he has had to try and cope with the challenges of high public liability insurance.



Mr HOCKEY —The member for Hotham talks about the Big Banana. Around the world and around Australia there are some big icons—there is a Big Pineapple, a Big Prawn, a Big Banana, and a Big Mistake. The Big Mistake is in the Labor Party. No amount of public liability insurance purchased by the backbench of the Labor Party is going to cover the accidents of the Leader of the Opposition.

In the lead-up to the small business ministers' meeting, I thought I should find out a bit more about state taxes and charges on insurance. I commissioned a report from Trow-bridge Deloitte and I asked them to tell me the 18 jurisdictions with the highest taxes in the world on insurance. They came back and they said that, coming in at No. 1, with up to 78 per cent tax on insurance, is Victoria. No. 2 is New South Wales, No. 3 is Tasmania, No. 4 is France, No. 5 is South Australia, No. 6 is the ACT, No. 7 is the Northern Territory, No. 8 is Queensland and No. 9 is Western Australia, followed by South Africa, Germany, the United Kingdom, Canada, the United States, Ireland, Singapore, Hong Kong and Japan. Australian states are charging up to 78c in the dollar in tax on insurance premiums. They are collecting up to 78c in every dollar. So, for any small business in regional Victoria that is paying $1,000 in insurance premiums, $780 is going to Steve Bracks in tax.

You would think that a state leader would be apologising to small business. I can tell you what Jon Stanhope, the Chief Minister of the ACT, has said. Get a load of this. His response to the claim that Australian states are charging more tax than anyone else is:

While Australia's insurance taxes are high compared to the world, within Australia, the Territory's general insurance rate is competitive with other jurisdictions.

He says we have got the highest tax rates in the world but, sure, we are competitive with other jurisdictions! I am happy to table that and I am happy to table my press release warning the Chief Minister of the ACT that someone has stolen his letterhead and put out a hoax press release.