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Tuesday, 22 June 2010
Page: 6090


Mr HOCKEY (2:16 PM) —My question is to the Prime Minister. Given that Telstra, Woolworths, Coca-Cola, JB Hi-Fi, Leighton, Metcash, Foster’s, Brambles and Cochlear, to name a few, were all more profitable companies last year than Rio Tinto, will he confirm that they would all face a superprofits tax like the great big new tax on mining if his logic to the new tax were applied across all sectors as suggested by the Secretary to the Treasury?


Mr RUDD (Prime Minister) —I welcome this question from the member for North Sydney on the impact of taxation policy on Australian companies. There is a fundamental difference here: we intend to take the Australian company rate down two percentage points; you propose to take the company rate up two percentage points. That is the basic difference. I could not see a more basic difference. But, of course, I note the member for North Sydney—and I refer the him to the answer I gave the Leader of the Opposition in my last question—has also referred again to share market performance. I will not go to the member for Dickson again, but I notice he is performing well: when he bought in it was $38.53; it is now up to $39.97. He has scored a neat 100 bucks in only one month’s work, and that is what has happened since before the introduction of this tax.


Mr Pyne —Mr Speaker, I rise on a point of order. If this Prime Minister is too embarrassed to answer the question, he should just sit down and allow us to move on.


The SPEAKER —That was not a point of order.

A government member—He’s pointless!


The SPEAKER —The parliamentary secretary is making the road even rockier. It has been a while since he has been out for a cup of tea, but he knows what is involved.


Mr RUDD —The question was about the profitability of firms. I also draw the member for North Sydney’s attention to the following performance of a few mining stocks since before the government introduced its plan for a new superprofits tax on the resources sector. Mount Gibson Iron, for example, on 30 April was $1.71. It is now up to $1.74 a share. Pan Australian Resources Ltd was at 52c and is now trading at 55c. Fortescue, I have to admit, was trading at $4.58 before the introduction of the package. It is now $4.57. We are down 1c, so sorry about that. Rio Tinto was $72.10. It is now up to $72.34. Here is another one: Centennial Coal was trading at $4.30; it is now up to $4.78. It is not going too badly at all. Newcrest Mining was trading at $33.09. It is now trading at $35.74—not too bad at all. We also have Lihir Gold, which was trading at $3.81 and is now trading at $4.40. We have Paladin Energy Ltd. It was trading at $4. It is now at $4.04—and so the list goes on.


Mr Laming interjecting


The SPEAKER —Order! The member for Bowman is warned.


Mr RUDD —I say to the Leader of the Opposition and the member for North Sydney that of course share markets go up and down; but, insofar as we have seen developments over the last month, I think they point to a certain distinction between fact and fear. We are trading in the business of what actually is the factual impact of the proposed taxation regime we have put forth on the future of the Australian company sector, and that is to bring down the company rate by two percentage points. You propose to take it up two percentage points. We proposed to bring in tax breaks for small business—all 2.4 million of them. You propose to rip those tax breaks away. I could not see a more fundamental distinction between what we stand for on tax reform for Australian companies and what you stand for on tax nonreform for Australian companies.