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Tuesday, 22 November 2011
Page: 9168

Senator COLBECK (Tasmania) (16:41): Doesn't Senator Sterle have a nerve coming in here and talking about truth? You have to be kidding! Here is a member of a government whose Prime Minister went to the last election promising, 'There will be no carbon tax under a government I lead.' He then comes in here talking about truth. Give us a break! 'There will be no carbon tax under a government I lead'—that would have to be one of the biggest lies that I have ever heard in my parliamentary career, and Senator Sterle comes in here trying to convince us that we ought to be talking about the truth.

So let's go to the truths around the mining tax. The mining tax: one of the mechanisms that Prime Minister Gillard used to knife Kevin Rudd and take the prime ministership off him—there is a truth. Another truth: a deal negotiated by Prime Minister Gillard with the big three and announced before the election as one of her fixes, to the exclusion of the rest of the mining industry regardless of size. This is a deal negotiated by Prime Minister Gillard with the big mining companies—just three of them—in the lead-up to the election, after it was used as one of the reasons to knife then Prime Minister Kevin Rudd.

Another truth: the government will not release all the details of the spending measures in the out years. Senator Sterle wants to talk about truth; that is another truth. They will not release all of the information around the mining tax—another truth—which is the point of this motion here today. Senator Sterle wants to talk to us about the truth, yet they are the perpetrators of the greatest lie in recent political history: 'There will be no carbon tax under a government I lead.' They had better get used to hearing that because it is going to come back and back and they are going to hear it over and over right up to the next election.

The government want us to trust them with the information and the facts around the mining tax, yet they cannot be trusted to tell the truth. It was the very thing that Senator Sterle wanted to talk about in his contribution—the truth around the mining tax—yet Senator Sterle neglected to let us know that this is a deal that Prime Minister Gillard did with three big mining companies before the election, after using it to assist her to knife her leader Kevin Rudd and then move on to the election.

Senator Carol Brown interjecting

Senator COLBECK: Senator Carol Brown might like to tell us what she has done to assist the Savage River mine, where magnetite is mined on the west coast of Tasmania. They still do not know their status under the mining tax—whether they are in or whether they are out. Mr Wilkie came out yesterday quite flamboyantly saying that he had worked with the government to raise the threshold on the mining tax for Tasmania, but he has done absolutely nothing to assist this company mining magnetite on the north-west coast of Tasmania. They still do not know whether they are in or out. That is a truth of this particular piece of legislation. Here is a company which is in the iron ore game, but they are actually mining a product which, when it comes out of the ground, has very little value. They do not know at what point they are going to be taxed.

Senator Carol Brown quite rightly sits quietly because she has done nothing to help that business. Mr Wilkie did nothing to assist that business—and he is one of the people who had the whip hand in the negotiations. He is one of the people who had the opportunity to decide whether this tax got passed. He came out triumphantly yesterday to tell the Tasmanian people that he had had the threshold raised from $50 million to $75 million. That might be an achievement, but one of the major mines in Tasmania still does not know its status. Had Mr Wilkie been aware of some of the issues going on around the state and had he not been focused just on Hobart, he might have been able to make a difference. That is one of the truths of this mining tax.

Another truth of the mining tax is that the government tried to give the impression to small businesses across the country that they are going to get a tax rebate. Small businesses which are companies will get a tax rebate under this legislation, but 65 per cent to 70 per cent of them are not companies and they miss out on the tax rebate. So there is nothing in it. That is another truth of this piece of legislation.

Senator Sterle: What do you mean? Two million companies will get a tax break. What companies aren't companies?

Senator Williams: Partnerships.

Senator COLBECK: Partnerships and sole traders—they do not get a tax break out of this. In fact, they potentially get a tax increase. The 65 per cent to 70 per cent of small businesses which are not company structures potentially get a tax increase because the 25 per cent entrepreneurs tax offset is gone under this piece of legislation. The 25 per cent entrepreneurs tax offset disappears under this piece of legislation—another truth. So rather than getting a tax cut as a small business, they get a tax increase as a small business—because they lose the tax offset which was part of the Howard government's 2004 election policy. That demonstrates the attitude of this government to small business—small businesses are the ones they get their union mates to go around and attack, trying to turn them around and change them into a different form of business. That is what happens to those small businesses, that 65 per cent to 70 per cent of small businesses which do not get any benefit out of this process.

The government also tried to tell small businesses and the employees who work in them that this process is going to fund an increase in the superannuation rate. But this process is not going to fund an increase in the superannuation rate; the employers are going to fund an increase in the super­annuation rate. That is the truth of this legislation. The employers will fund it or, in some cases, it will be the employees of the business who will suffer a reduction in salary increases as a result of the increase in the superannuation guarantee. That might be a small percentage, but it is going to happen.

In fact that is what Henry said. That is what the Henry tax review, where this whole process started, said. The recommendation from the Henry tax review was to leave the superannuation rate at nine per cent. So the government cannot come in here and argue that Henry supports the mining tax on one hand because on the other hand he was making a very different recommendation when it came to superannuation.

You might look back and say, 'How do you end up with a decent small business here in Australia?' The answer to how you end up with a decent small business in Australia is to start with a big business and put this lot in government. You only have to look at the steel industry to get a demonstration of that. The two biggest players in the steel industry were worth $8 billion back in February. Now they are worth $3 billion. They have had $5 billion wiped off the value of their shares since February.

Senator Sterle: How is that our fault? It is the Aussie dollar.

Senator COLBECK: No, it is not because of the Aussie dollar, Senator Sterle. The steel rescue package only commits them to the retention of a fraction of their existing business. One of them is already closing down a smelter. The other one told us yesterday that their Whyalla smelter is on watch—it has 12 months. That is what is happening under this government. They bring out a steel transformation plan, but it is a bit late—because they have already transformed the steel industry. They have turned it from an industry where the two major companies were worth $8 billion at the top to one where those two companies are worth only $3 billion. That is a transformation all right.

They come in here and they want to talk to us about truth. The real truth is that you cannot trust this government. You cannot trust what this government says. It does not matter what arguments they try to put here in the chamber or what arguments they try to put outside. This is the government which promised the Australian people, 'There will be no carbon tax under a government I lead.' All of them were elected on that promise. Every single one of them was elected on the promise, 'There will be no carbon tax under a government I lead.'

Then we come to the 'year of decision and delivery' and what are the deliverables? A carbon tax and a mining tax. They are the key deliverables for this government—new taxes. Then, when they start talking about the offsets to the mining tax, the reality is that they are going to spend more than they raise from the mining tax. What sort of fiscal responsibility is that? How can they come in here with any credibility? 'There will be no carbon tax under a government I lead'—we have just passed a carbon tax and now they want to pass a mining tax.