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Monday, 18 August 2003
Page: 18679

Mr LATHAM (Manager of Opposition Business) (1:13 PM) —The Taxation Laws Amendment (A Simpler Business Activity Statement) Bill 2003 is a bill to simplify the BAS system and cut GST red tape and compliance costs. It contains good policy solutions. It responds to a serious problem in the small business sector. I am sure many members in the House have heard the complaints from small business that they are acting effectively as tax collectors for the government; complaints that small business people are spending more time working for the government than they are for themselves. This is a real problem. It is a problem that can be addressed through the House adopting this particular piece of legislation.

If the Liberal Party continue to oppose the simpler BAS option my advice to small business is straightforward: do not listen to what the Liberals say; look at what they do. This is a government that discriminates against small business. Just ask Neumann Petroleum, and look at the disgraceful way in which the government conspired with big business in the ethanol industry to do over this small Australian company with just 59 employees. They were done over very badly.

We even have the National Party saying that the Treasurer is anti small business. The National Party federal director, Andrew Hall, in the Weekend Australian on 2 August said:

The Liberal Party is seen as very good at representing the large end of town ...

Wouldn't Dick Honan agree with that? Then he went on to say:

... it struggles to relate to the challenges of the average family and the average small business.

A week later on the AM program the member for Cowper reinforced this criticism by saying:

There's been a tendency in the past to take what is basically a large business template and adjust that, or modify that, to a small business perspective.

Poor old Neumann Petroleum did not even get the template. They did not even get the template on the way through from Brazil to Australia; they just took the $400,000 loss because of the government's conspiracy with big business. This is a government, according to the National Party, that has ignored small business. But the National Party themselves were complicit in doing over Neumann. That is the bottom line for the government: the Treasurer is hopeless and the National Party are hypocrites on the issue of small business.

The answer is in this bill. Labor's simpler business activity statement offers two huge advantages for small business. First, businesses with a turnover of less than $2 million can adopt an ATO approved ratio to turnover method for calculating their GST liability. Based on their experience since the introduction of the GST, the tax office would provide businesses with GST ratios so that they could make a simple payment as a proportion of quarterly turnover. New businesses would be able to use an industry based ratio while the ATO was developing their individual ratio. Importantly, this ratio would generate a final liability—there would be no need for any reconciliation down the track.

Businesses can opt in and, if their circumstances change, they can opt out. That is what the Labor Party stands for: options, choices and flexibility for the small business sector and some relief from the crushing burden of GST paperwork and compliance costs. The $2 million turnover threshold for small business would also be adjusted by regulation to stay aligned with other small business compliance measures.

The second huge advantage of Labor's simpler BAS is that businesses can reduce GST compliance costs. Under Labor's system, the ATO would not be auditing every input tax credit claim and checking every tax-able sale. Instead, all a small business would have to do would be to disclose its full turnover and apply the ratio method accurately. Unlike under this government's shock-ing record-keeping requirements, businesses would only need to keep those records relevant for the audit—in other words, only those records concerning turnover. Make one calculation, fill out two boxes and the BAS is done. That is Labor's policy: one calculation, two boxes and the BAS is done.

Mr Crean —It can't get simpler than that.

Mr LATHAM —As the Leader of the Opposition rightly says, you could not get simpler than that. You could not get a better policy for lowering GST compliance costs and reducing that red tape burden that weighs down the good small business people of this country who have to give up their weekends to work for the government instead of working for themselves or getting a chance to spend some time with their families on a Saturday or Sunday.

The DEPUTY SPEAKER (Hon. I.R. Causley)—I remind the member for Werriwa that a first reading is an explanation, not an opportunity to debate.

Mr LATHAM —That is the bottom line. If there is no fraud, there is nothing to fear. Labor's BAS option is simple; the choice be-fore the House is simple. The House should stick up for Australian small businesses and support Labor's bill. If the member for Cowper and the other National Party members could get away from their assistance for Manildra and actually look at the interests of small business they might see fit to support this bill. They have dudded Neumann Petroleum; they have exposed themselves as hypocrites. But I now give them the opportunity to make up for it. Support this bill, do the right thing by small business and at long last reduce the compliance costs, reduce the red tape and give the hardworking small business people of this country a fair break. (Time expired)

Bill read a first time.

The DEPUTY SPEAKER —In accordance with standing order 104A, the second reading will be made an order of the day for the next sitting.