Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Transcript of press conference: Canberra, ACT: 28 June 2018: business tax cuts



Download PDFDownload PDF

Press Conference - Business Tax Cuts

Senator the Hon. Mathias Cormann Minister for Finance Leader of the Government in the Senate Senator for Western Australia

Transcription:

PROOF COPY E & OE

Date:

28/6/2018

Topic(s):

Business tax cuts

MATHIAS CORMANN: Our economic mission as a Government is to deliver stronger growth and more jobs, so that families around Australia have the best possible opportunity to get ahead. Stronger growth and more jobs leads to higher wages and it leads to more revenue for Government, which helps us fund the essential services Australians rely on and expect their Government to deliver on. Our plan for a lower, globally more competitive business tax rate for all businesses across Australia is all about delivering stronger growth and more jobs so that Australian families have the best possible opportunity to get ahead. It is all about protecting our economic security and about securing our economic prosperity into the future, by making sure our businesses here in Australia can be internationally competitive.

It is clear that more and more Australians are coming on board with our plan to strengthen growth, create more jobs, by lowering our business tax rate for all businesses across Australia to 25 per cent. In fact, more and more One Nation voters are coming on board with that plan. However, despite our best efforts to secure majority support in the Senate for our proposed business tax cuts, we have not yet been able to secure the necessary support. We need more time to make our argument to our colleagues on the Senate crossbench and we will continue to make our argument in the Australian community. That is why we have decided to defer consideration of the legislation to implement our plan for a lower, globally more competitive business tax rate for all businesses here in Australia until after the break.

The Government remains fully committed to these business tax cuts for all businesses because it is the right thing to do for working families around Australia. They were important when we went to the last election, they are even more important now. When we went to the last election, the United States had a business tax rate of 35 per cent. Since then, that has been reduced to 21 per cent. When we went to the last election, France had a business tax rate of 33 per cent. They have since legislated to progressively reduce their business tax rate from 33 per cent down to 25 per cent by 2022.

Australia is an open trading economy. We compete for capital and for access to markets with businesses in countries all around the world. Businesses in most other countries of the

financeminister.gov.au/transcript/2018/06/28/press-conference---business-tax-cuts

world have the benefit of lower business taxes in those countries. Nine out of ten working Australians work for private sector businesses who either compete with businesses in other parts of the world in markets around the world, or who compete against imports against businesses from other parts of the world here in Australia. We compete for capital with businesses in other parts of the world. It is crucially important that we put ourselves in a position where businesses here in Australia are able to effectively compete and are not put at a deliberate, ongoing structural disadvantage with businesses in other parts of the world. This week, Bill Shorten has made the reckless and irresponsible decision to inflict higher taxes on small businesses across Australia. He is trying to pretend that, somehow, this was not a new decision, that this is just a reflection of how Labor has voted in the Parliament before. Well, if their policy is as Labor voted in the Parliament before, then Bill Shorten wants to inflict higher taxes on every business with a turnover above $2 million a year, because that is how Labor voted in the Parliament before. Higher taxes under Labor will mean fewer jobs and lower wages. Higher taxes under Labor will hurt the economy, hurt families and cost jobs. Under our plan, under our plan for stronger growth and more jobs, we will deliver lower taxes because that is necessary for more investment, stronger growth, more jobs, which deliver higher wages over time.

Happy to take questions.

QUESTION: You said you will try again after the winter break, is that a reflection that maybe there is too much pressure on the crossbench with these by-elections happening? Are you optimistic that may ease a bit after the by-elections?

MATHIAS CORMANN: The by-elections will be a referendum on who has the better plan for a stronger economy and more jobs. Mr Shorten, who is pushing higher taxes, which lead to less investment, lower growth, higher unemployment and hence, lower wages over time, or our plan for a stronger economy and more jobs, which will attract more investment so businesses can be more successful, hire more people and as there is more competition for workers, drive up wages. After the by-elections, who knows? We might have a more business-friendly Labor leader. All sorts of things could be different on the other side of the by-elections. Bill Shorten is all over the place and he cannot be trusted with the Australian economy. He is all over the place, but one thing is clear, that his instinct and his commitment always is to inflict higher taxes on everyone. Higher taxes on business, higher taxes on hardworking Australians, higher taxes on retirees, higher taxes on homeowners.

There is not a tax that Bill Shorten does not like. If Bill Shorten does well in these by- elections, he will see it as endorsement for his plan for higher taxes, which we say would hurt the economy, hurt families and cost jobs. We say to people in Longman and in Braddon, you have an opportunity to send Bill Shorten a message, if you do not support his plan for higher taxes that will make you worse off, vote for the Liberal candidate in Braddon and Longman.

QUESTION: If those by-elections are if you say “a referendum” on competing economic plans, if voters keep Labor in place in these by-election seats, should the crossbench maintain their position?

MATHIAS CORMANN: These are Labor seats. The only reason we are having these by- elections is because Bill Shorten misled the Australian people. He gave a rolled gold

guarantee that was not worth the paper it was written on. What is clear is that more and more Australians start to realise that they cannot trust Bill Shorten. Bill Shorten lied in the last election about Mediscare. He lied when he said that his MPs had no citizenship issues. He is lying when he talks about the fiscal impact of business tax cuts. Quite frankly, I do not think he is picked up on this enough. Everyone in this room knows that when he talks about an $80 billion tax give away to the big end of town that is a lie. He knows that nearly half of the fiscal impact of our business tax cuts goes to small and medium-sized businesses.

Businesses that he has announced this week he will hit with higher taxes. Which will lead to less investment, fewer jobs, higher unemployment and lower wages. What I am saying, in response to David’s question, What I am saying is that the people of Longman and the people of Braddon do have an opportunity to send Bill Shorten and Labor a message. If they do not like Bill Shorten's higher taxes on business, on hardworking Australians, on retirees, on homeowners, on everyone who moves, then vote against Labor, put Labor last. That is their opportunity.

QUESTION: Senator Cormann, I understand that Pauline Hanson is looking for three coal- fired power stations along the East Coast in exchange for her vote. Are you willing to negotiate along those grounds?

MATHIAS CORMANN: As the Prime Minister said quite rightly yesterday, we do not conduct our discussions with crossbench Senators through the media. We are here to be accountable for our decisions and we explain the decisions that we make. As far as we are concerned, our plan for a lower, globally more competitive business tax rate for all businesses across Australia, down to 25 per cent is the right thing to do. It is the right thing to do in its own right.

QUESTION: Are you willing to trade coal-fired power stations for votes?

MATHIAS CORMANN: I am not going to get into a public conversation with the crossbench.

QUESTION: You singled out One Nation voters. You said more and more of them were on board with your plan. Given that Pauline Hanson has talked about multinationals not paying enough tax, what assurances have you sought to give her this week and previously that efforts are being made on that front?

MATHIAS CORMANN: Our Government, under the leadership of Malcolm Turnbull and Scott Morrison, have taken very strong action to ensure that multinationals here in Australia pay their fair share of tax. We have passed the Multinational Anti-Avoidance law, we have passed the Diverted Profits Tax legislation. We have taken all sorts of other measures and taken initiatives to ensure multinationals pay their fair share of tax here in Australia. These measures are working. These measures are working. This financial year, 2017-18, we are actually raising $9.2 billion more in company tax revenue than was expected just before we passed the initial three years of our business tax cut plan. It is a matter of public record that the Australian Taxation Office is taking very strong action. 44 businesses have relocated relevant parts of their operation back to Australia to ensure that they are properly taxed here in Australia. There are more than 300 companies that are under active audit as a result of the measures that we have taken. We are at one with Pauline Hanson and One Nation when it comes to making sure that multinationals pay their fair share of tax here in

Australia. We have taken strong measures. We are always prepared to look at other sensible things to do. The Treasurer has announced in the Budget and has released a discussion paper in relation to the whole issue of taxation of digital services. We are always committed to do the right thing. But to ensure that working Australians have the best possible opportunity to get ahead, we need to ensure that the businesses that employ them and pay their wages have the best possible opportunity to be competitive, to be viable, to be profitable into the future. If businesses in Australia are less competitive and less viable and less profitable, they will hire fewer people than they otherwise would. Hiring fewer people than they otherwise would means higher unemployment, means lower wages.

QUESTION: Do you promise to put this up, one way or the other after the by-elections given that you have been critical in the past over Labor's refusal to put their plan to lower company tax cuts to the Senate?

MATHIAS CORMANN: We will do everything we can to get this legislation through because…interrupted

QUESTION: That was not my question. Do you pledge to put it to the vote?

MATHIAS CORMANN: Andrew, I pledge that we will do the right thing by the Australian people and the Australian people need us to secure the passage of this legislation.

QUESTION: Have you squibbed it by not putting it to a vote? You said you were going to.

MATHIAS CORMANN: I said our intention was to deal with this this week. I said that our intention was to secure the passage of this legislation this week. That was absolutely our intention. But we believe it is critically important to ensure that these business tax cuts for all businesses across Australia can be legislated, because we want to protect our economic security into the future, we want to secure our economic prosperity into the future. Making sure that businesses in Australia can be competitive with businesses in other parts of the world is a very important part of that.

Let me make one more point in relation to Bill Shorten. Bill Shorten says he is against the big end of town. Bill Shorten is helping the big end of town in just about every country overseas take investment and jobs away from Australia. Bill Shorten is locking in a competitive advantage for businesses in other parts of the world by forcing business taxes here in Australia to remain high. He is making a decision, an un-Australian decision, Bill Shorten is making an un-Australian decision to put businesses in Australia at an ongoing disadvantage with businesses in other parts of the world by locking in on an ongoing basis, that is his position, a higher tax on business here in Australia. He should stand condemned for that.

QUESTION: What is your evidence that more and more One Nation voters are supporting your tax cut plan? Are you telling Pauline Hanson that you know something about her voters that she does not?

MATHIAS CORMANN: I would be very surprised if you do not read the published polls. I know politicians rarely look at published polls, but I thought journalists did look at published polls. There was a poll in The Australian not that long ago which showed more than 60 per cent of One Nation voters supported a lower business tax rate for all businesses across

Australia. Today I am reading in the Courier Mail that 66.9 per cent of One Nation voters in that seat support a lower, globally more competitive business tax rate for all businesses. That was even higher than the support among Liberal voters. More One Nation voters in Longman are supporting a lower, globally more competitive business tax rate than Liberal voters.

QUESTION: Is she betraying the voters then?

MATHIAS CORMANN: I respect the fact that Pauline Hanson, with whom I have had many very good conversations, I respect the fact she is focused on making the right decisions as she sees it in Australia's national interest. I absolutely respect that. My proposition is, that as we are making this argument, more and more Australians are starting to understand, to accept and to support the fact that for us to be successful into the future as a country, we need to ensure that our businesses across Australia can be successful. To ensure that our businesses can be as successful as possible, they need to be able to compete. We should not be deliberately imposing burdens on businesses here in Australia that are not faced by businesses in other parts of the world. I hope that the fact that One Nation voters increasingly appear to be coming on board with our plan for lower business taxes will, over time, help to persuade Senator Hanson that this is the right thing to do.

QUESTION: Is the Mayo by-election a referendum on these tax cuts as well, given the incumbent Member has been very sceptical of them?

MATHIAS CORMANN: When you say as well, what I have said earlier, these by-elections are a referendum on who has the better plan for a stronger economy and more jobs. Labor voters in Longman and Braddon in particular have the opportunity to send Bill Shorten a message if they do not support his plan that will make them worse off. His plan for higher taxes will lead to less investment, lower growth, fewer jobs, higher unemployment and lower wages over time. Whereas our plan for lower taxes will lead to more investment, stronger growth, more jobs, which will lead to higher wages over time. In Mayo, we have a candidate in Georgina Downer who supports our plan for a strong economy and more jobs. We are recommending a vote for Georgina Downer in Mayo. Labor voters around Australia have the opportunity to send Bill Shorten and the Labor Party a message, that they do not support his plan for higher taxes, which would hurt the economy, hurt families and cost jobs.

QUESTION: Senator Cormann, have either One Nation or Centre Alliance indicated to you that they may be more amenable after the by-elections?

MATHIAS CORMANN: Phil, you know me better than this. I never talk about my private conversations with crossbench Senators through the media. I will not start doing that now. I have explained the Government's position to the best of my ability. I can speak for myself. I cannot speak for others.

Thank you