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Wednesday, 21 March 2012
Page: 3761

Taxation

Mr PERRETT (Moreton) (14:32): My question is to the Treasurer. What benefits will flow throughout the Australian economy following the passage of the minerals resource rent tax? In particular, has the government assessed the impact the corporate tax cut will have on Australian industries? And how is that government dealing with proposals to increase the corporate tax rate?

Mr SWAN (Lilley—Deputy Prime Minister and Treasurer) (14:32): I thank the member for Moreton for that very important question. We on this side of the House understand the importance of the change in weight in the global economy of the movement from west to east. That is producing a stunning investment pipeline of something like $455 billion in resources in Australia. We on this side of the House understand the absolute importance of spreading the benefits of that investment pipeline right across our country and right across every postcode. That is why we have introduced the MRRT as the revenue stream that will fund a tax break for 2.7 million small businesses through the $6,500 instant asset write-off. In the electorate of Moreton, that will go to something like 19,400 small businesses. That is why we are having this historic boost to superannuation savings, which will go to 8.4 million workers in our country. It is worth an additional $100,000 for a 30-year-old on average earnings. In the electorate of the member for Moreton, that is something like 50,000 people who will benefit, across all age groups.

This is a massive way to spread the benefits of the resources boom right around our country. But we should also do more, and that is why we on this side of the House want to cut the company tax rate by 1c, starting first of all with small businesses and then moving across the board. There is a very clear contrast here, because those opposite want to jack it up by 1½ per cent. They do not really have any comprehension of what it is like for all those businesses that are not in the fast lane of the resources boom—for example, small businesses on the Sunshine Coast, and right around the country.

I have been having a look at the difference between, say, a 29c rate and 31½c across various industry sectors. In the manufacturing sector that would be an additional tax bill of $392 million in manufacturing alone if they had their way. In the retail sector it would be a difference of $270 million.

Mrs Bronwyn Bishop: Mr Speaker, on a point of order, I refer you to page 553 of Practice, where it says, under the old rules of relevance, that 'an answer must maintain a link to the substance of the question'. Under direct relevance, it is even stricter. The Treasurer is certainly not connected to that, and I ask you to ask him to return to the question or else sit down.

The SPEAKER: The Treasurer was asked about the impact of not reducing the company tax—maybe not in those words, but that was the gist of it—and he is being directly relevant.

Mr SWAN: In the retail trade sector and the wholesale sector it would be an additional $400 million of tax paid by companies. In the media and telco sector it would be an additional $188 million and in the construction sector $322 million. In agriculture, forestry and fishing, an additional $306 million would be paid by companies in those sectors. So a proposal to increase corporate tax, precisely at the time— (Time expired)