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Monday, 26 March 2018
Page: 2093

Taxation


Senator McALLISTER (New South WalesDeputy Opposition Whip in the Senate) (14:00): My question is to the Minister for Finance, Senator Cormann. Can the minister confirm that, under the Turnbull government's $65 billion tax cut for big business, the big four banks can expect to save $9.5 billion? If not, how much can the big four expect to walk away with?


Senator CORMANN (Western AustraliaLeader of the Government in the Senate, Minister for Finance, Special Minister of State and Vice-President of the Executive Council) (14:00): What I can confirm is that the government proposed and the parliament passed the major bank levy, which was, of course, introduced by the government after the 2017-18 budget. What I can also confirm is that, if the Senate does not take steps to ensure that all Australian businesses are in the best possible position to be successful and profitable into the future, it will harm our economy. If we continue to put our businesses at a competitive disadvantage—and, may I say, in particular the bigger business across Australia—it will cost investment and jobs. That's what will happen. I know that the Labor Party likes to bash the banks, but the truth is that the banks are a central part of our economy, and strong and profitable banks—

The PRESIDENT: Order, Senator Cormann. Senator McAllister, on a point of order?

Senator McAllister: Mr President, my point of order is on relevance. I asked a specific question about how much the banks would expect to save.

The PRESIDENT: I note that the minister was addressing the issue of banks then and I note that he has a minute remaining to answer the question. Senator Cormann.

Senator CORMANN: Thank you very much, Mr President. The truth is that the government believes that it's in our interest to have one uniform corporate tax rate across all businesses, as has been the case under previous Labor administrations. The Labor Party never used to oppose a higher—

The PRESIDENT: Order, Senator Cormann. Senator Wong on a point of order.

Senator Wong: Thank you, Mr President. We have given the minister some time. We have asked an important question. We'd like a directly relevant answer. The question goes to the value of the benefit of the company tax cut, the government's company tax cut, to the banks. We've suggested it's $9.5 billion. If it's not that, what is it?

The PRESIDENT: Thank you, Senator Wong. Senator Cormann has 49 seconds remaining to turn to that question.

Senator CORMANN: Thank you very much, Mr President. I refer the Labor opposition to the analysis which was released by a number of economic and budget fiscal analysts after the last budget which showed our major bank levy and our corporate tax cuts combined effectively cancel themselves out as far as the banks are concerned. For example, the analysis by Civic that was released at the time—

Senator Cameron: How about answering the question?

Senator CORMANN: The Labor Party used to support business tax cuts. As recently as September 2015—

Senator Wong interjecting

Senator CORMANN: No. That's actually not right. That is not right. I heard that contribution. I heard that contribution by Senator Wong earlier. The shadow treasurer, Chris Bowen, on 22 September 2015 was quoted as saying that he understands that a higher company tax rate hurts the workers— (Time expired)

The PRESIDENT: Senator McAllister, a supplementary question.














Senator McALLISTER (New South WalesDeputy Opposition Whip in the Senate) (14:03): Last week, the minister said that the bank levy 'cancels out the effect of the corporate tax cut for the banks already', and the minister has confirmed this again in his answer to my principal question. Analysis conducted by the Australia Institute has found that, even with the bank levy, the Turnbull government's $65 billion tax cut will see banks substantially better off. Who is correct: the minister or the Australia Institute?


Senator CORMANN (Western AustraliaLeader of the Government in the Senate, Minister for Finance, Special Minister of State and Vice-President of the Executive Council) (14:04): Let me tell you: I would recommend to the Senate to take my word ahead of that of the Australia Institute. The Australia Institute is hardly a disinterested party.

Senator Wong: Neither are you!

Senator CORMANN: Indeed. The Australia Institute is made up of former or aspiring Greens politicians. Clearly the Australia Institute has always had a biased view against business. Greens across Australia in general don't understand that, in order for families to have the best possible opportunity to get ahead, the businesses that employ those families actually need to have an opportunity to be successful and profitable into the future. Now, the Australia Institute is a campaigner on this matter. They are activists on this matter, and I would not take their word for it.

The PRESIDENT: Senator McAllister, a supplementary question.





Senator McALLISTER (New South WalesDeputy Opposition Whip in the Senate) (14:05): Will the minister guarantee that, when taking into account the effect of the bank levy, the big four banks will not be better off as a result of the Turnbull government's $65 billion tax cut for big business?


Senator CORMANN (Western AustraliaLeader of the Government in the Senate, Minister for Finance, Special Minister of State and Vice-President of the Executive Council) (14:05): The senator asked me for a guarantee. I'll tell you what I can guarantee. What I can guarantee is that if we pass those business tax cuts in full the people who will be better off are Australian working families. What I can also guarantee is that if we don't pass them the people who will be worse off are Australia's working families.

The PRESIDENT: Senator Wong on a point of order.

Senator Wong: Direct relevance: the minister was asked to guarantee one thing, and that is whether the banks will be better off under his policy or not. I understand that he's avoiding the question, but that was the question.

The PRESIDENT: You've reminded Senator Cormann of the question, Senator Wong. Senator Cormann is being directly relevant to the question as it was put.

Senator CORMANN: What I can guarantee you is that if we continue to put Australia's big businesses at a competitive disadvantage it will cost investment and it will cost jobs. Senator Wong seems to think that the banks are something abstract out there that don't have any relevance to our economy. The truth is that stronger and more profitable banks are important for small and medium-size businesses operating in our economy. It's important for shareholders. It's important for self-funded retirees. Every self-funded retiree will have a large chunk of their retirement savings invested in banks, because they provide a reliable income stream for self-funded retirees—something that Labor doesn't understand. (Time expired)