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Tuesday, 22 February 2011
Page: 995


Ms MARINO (9:31 PM) —I rise to speak on the Tax Laws Amendment (Temporary Flood Reconstruction Levy) Bill 2011 and the Income Tax Rates Amendment (Temporary Flood Reconstruction Levy) Bill 2011. People in my electorate are like the majority of Australians in that they believe in helping out a mate who has struck hard times, or families and communities as we have seen in Queensland, New South Wales, Victoria and Western Australia. I want to personally express my condolences to the families and communities who are mourning those who died in the recent floods. There has been and still is almost immeasurable goodwill and support being offered by people from the south-west of WA. We all understand that the people of Queensland, New South Wales and Victoria need support to rebuild their infrastructure, their local economies and the communities that were so devastated by the floods of last month and by Cyclone Yasi.

We also want to support those in states like Victoria who have suffered over and again with floods, those in our own Gascoyne and Carnarvon areas who suffered flooding in December and January and those in the electorate of Canning who lost homes and property in recent bushfires. We understand and readily accept that some of our taxpayer dollars should go towards this massive rebuilding process right across our nation.

It is entirely appropriate that Commonwealth funds are spent on rebuilding lives and communities. However, I disagree with this government on where those funds are derived from. We are almost punch-drunk with the list of taxes that this Labor government is either inflicting or proposing to inflict on the people of Australia. And if we are not punch-drunk with the government’s new taxes to date, by the time the government has introduced its carbon energy tax, its mining tax and the flood tax, taxpayers will well and truly be tax-punch-drunk. If we had a fiscally responsible government, this tax would not be necessary.

My family runs a small business, like millions of other Australians. We have a dairy and beef farm, and like everybody else in business we have to allow for and manage the many contingencies—those unexpected things that happen in the running of our business. It is something that is faced by small businesses constantly. For instance, last year was the driest year I can remember since I was married and started farming, and we received only half our average annual rainfall. As a result, the water levels in our water storage dams in the hills were extremely low. There was very little run-off into these dams and, as a result, we were effectively receiving only 34 per cent of our annual irrigation allocation to water our pastures over the summer months that we are now going through. This is a major issue on an irrigation farm.

What did we do? We dealt with it and it has cost our business to do so. We had to increase the frequency of our fertiliser applications, which was more cost, manage our pastures extremely efficiently and, when additional water was released by the state government, choose to buy additional allocation to use in our irrigation program. Other farmers—small business people just like us—had to make a range of decisions that best managed the problem in their own individual circumstances. Some, like us, bought additional water, some bought more grain or dairy rations to feed their cows, and others cut back production to match the feed they had available. All of them, however, took some action to deal with an unforeseen circumstance that was impacting on their business.

The decision to buy more water cost individual businesses anything from five per cent and upwards of their annual gross milk income to simply produce the same amount of milk as they did the year before. These businesses had to absorb at least that five per cent or more cost to generate the same revenue. Whether it was paid for as extra grain or forgone in reduced production, the cost to farmers was similar. How does this parliament think we achieved this? How does the parliament think a million other small businesses across Australia absorb costs like this that go hand in hand with managing a business?

According to the Australian Bureau of Statistics, there are about two million businesses in Australia, of which more than half are classed as sole traders. They do not employ other people, and there are plenty of Australian farmers in this group. Of the other ‘employing’ businesses, some 70 per cent have between one and four employees, and 90 per cent have less than 20. These business owners—the backbone of the Australian economy—cannot just put up their prices every time something unexpected happens. If you are a dairy farmer you are an absolute price taker. That is how it is. And if you are in Western Australia, you are at extremely serious risk at the moment of even lower milk returns because you are caught in the middle of the current market share war between Coles and Woolworths.

So how does the government think business owners manage contingencies? We do it by reworking our budget. We have to cut our spending and reprioritise what we are going to do. That is what is expected of a couple of million Australian small businesses. They do it on a regular basis. There are always contingencies. How does this compare with the Australian Labor Party, which is currently in the business of running the Australian government? When a contingency arose—the storms, the floods, the fires—this Labor government announced a $5.6 billion package. That is just 1.5 per cent of the budget available to the government—and certainly not the five per cent, at least, faced by irrigation farmers—and the government cannot manage it. They will not make the tough decisions that businesses across Australia have to make all the time to manage their business. Instead, they are taking the easy way out. They are imposing another tax to cover their weakness.

On behalf of the couple of million small businesses like mine that regularly have to absorb contingency costs of five per cent at least when things get tough, I want to express to this parliament the anger and disgust felt in the community towards a government that is incapable of simply doing what good governments are expected to do: to make tough decisions when the situation calls for it, as this one does. I understand why the government might not understand this message. I do not know how many of the members opposite, particularly on the front bench, have personal experience of running a business, be it large or small, and I am not sure how many have actually filled out a BAS or another GST type statement. You have to make tough decisions when you are in that position. But when you are in government it is your job to manage these types of contingencies. That is why we have a government. The Australian community expect this government to do what they themselves as small business people have to do.

The tax proposed is clear evidence that this government is a ‘tax first’ government. Their first, knee-jerk reaction is a tax. There was an editorial in the West Australian that expressed what I believe to be a genuine community view, and that is:

Many reasonably believe that the Government, which takes a healthy slice of our incomes in taxes, needs to find a way of paying for reconstruction without taking more. That, after all, is what governments are elected to do, manage taxpayers’ funds prudently and make sure they can meet national contingencies.

I will repeat that:

That, after all, is what governments are elected to do—

and what this government was elected to do—

manage taxpayers’ funds prudently and make sure they can meet national contingencies.

Unfortunately, there are words in this paragraph that are anathema to this government, and they are clearly the words ‘manage taxpayers’ funds prudently’. Unfortunately for Australians, particularly for those generous Australians who have already donated to the flood and cyclone relief efforts, this government has not, can not and will not manage taxpayers’ funds prudently. This is just further evidence of that.

As a community volunteer for a lot of my life, one of the things that most disturbs me about this knee-jerk-reaction tax is the effect it may have on the future generosity that Australians are well known and well respected for. In my electorate, people collected clothing and goods and sent them off to Queensland. On a personal level, they donated extremely generously, as people right around this nation did.

There have been many phone calls to my office. One of the many complaints was from a small business man in my electorate, who rang to tell me that the moment the government announced the tax he cancelled his $1,000 donation to the flood appeal. He was so angry that the government took for granted his donation and his goodwill. He even asked me why he should donate to other charities, like the Salvation Army, if this was what was going to happen in this nation. This is a story that I have heard over and over, and as a community volunteer I am seriously concerned about it.

I say to this government: Australians are generous, community minded people, but you should not take their generosity for granted or abuse their natural kindness and community spirit. Do not put this at risk. Do not make people question their very natural generosity and their community spirit. What really annoys people the most is that they are well aware of this government’s wasted billions in the BER, computers in schools, home insulation and countless green programs. The list is growing. The most damning thing of all is that people know that the government’s interest bill alone this financial year would have paid the levy at least twice over. What a wasteful, dreadful government. For people in my electorate facing cost-of-living pressures, this is almost unbearable—a government addicted to wasting taxpayers’ funds but at the same time increasing taxes on a regular basis. The Australian community should not have to keep paying more and more taxes simply because this Labor government cannot properly manage the business of government. Thank you.