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Tuesday, 22 June 2010
Page: 6094

Mr BRUCE SCOTT (2:32 PM) —My question is to the Prime Minister. I refer the Prime Minister to a small business in my electorate, Foztrax, which subcontracts to the resources sector. Since the announcement of the great big new tax on mining, they have had to cut their workforce from 15 to five employees. Will the Prime Minister advise Foztrax on what to say to the working families of the 10 employees who no longer have a job?

Mr RUDD (Prime Minister) —I thank the member for Maranoa for his question. I draw the member’s attention to the impact of the government’s overall tax reform plan, which in fact is to boost employment in the mining industry by something like 7.7 per cent. That is on the back of the range of measures contained within the overall tax reform plan.

Secondly, he refers to a small business. I do not know whether it is incorporated or not, but incorporated small businesses within his electorate would be entitled to a two percentage point tax cut. If they have a turnover in excess of $5 million then they would of course get a two per cent increase in their effective company rate as a consequence of the policy which he is putting forward for the next election. I know the National Party so strongly supports the Leader of the Opposition’s plan for a two per cent levy, in effect, to pay for the Leader of the Opposition’s Paid Parental Leave scheme.

I also say that when it comes to the employment performance of the mining sector it is very important to put this into the context of the last 12 months. In the middle of last year the minister for resources informed me that we had had something like a 15,000 cut in the overall mining workforce in Australia. That is a very large cut. Of course, they were wrestling with circumstances in the global economy at the time. If that cut had been reflected across other sectors of the economy in percentage terms it would have meant that at that time we would have been seeing something like a 19 per cent unemployment rate across Australia. That is the level of reduction which occurred in employment in the mining industry last year.

I draw the honourable member’s attention to the importance of tax reform. The government’s bottom line when it comes to tax reform is to get it right. The government will be sticking to the framework that we have put forward. The government believe in a profits based tax. We believe in a tax which is set at 40 per cent, a tax which applies to existing projects and one which delivers revenue for the stated policy priorities of the government. That is the sort of framework we are taking to the negotiations with the mining sector at present. Some of those companies are negotiating with us well, others less so. I doubt very much whether some of the big mining companies will be singing and dancing in the streets over the prospect of paying more tax. We intend to get on with the business of tax reform, better super for working families in the member for Maranoa’s electorate, tax cuts for small businesses in his electorate, tax cuts for incorporated companies in his electorate and, overall, a good reform for the nation.