Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016
23 Mar 2017
Dr CHALMERS (Rankin) (12:22): It is my pleasure to follow so many colleagues who have made so many good points about the Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016, including just now the member for Mayo. But there are also the points that have been made on this side of the House by the member for Oxley and others as we oppose this big business tax cut, a $50 billion ram-raid on the budget. I am proud as well to support the amendments moved by the member for McMahon, who made the very sensible point that when the budget is in the condition it is in right now it is just madness to contemplate taking $50 billion off people and off the bottom line of the budget and hand it to the big multinationals and the big four banks. So I am proud of our position.
We are part of a bizarre spectacle where we are debating a bill about a tax cut that we do not know will even make it to the weekend. When you read the articles that have come from well-placed sources in the government, when you look at the fact that the Treasurer stood at the despatch box a couple of times yesterday, and many times in the media, and could not even back-in this tax, which he says is so important to give to big multinational corporations and big banks. He has refused to back that in in the last little while. So everyone in this place and everyone in the media, and people in the broader Australian community who follow this important national debate know that in the House right now we are debating a bill that the government is about to gut. When they do gut this bill, it will be a humiliation for the Treasurer. It will be the final humiliation for the Treasurer, who has made a habit of humiliating himself, whether it be from his connection with the bright idea of holding the NDIS hostage to vulnerable people, or holding child care hostage to making cuts to the payments to vulnerable people, this Treasurer is generally at the seam of the biggest debacles.
The best summary of this shambles we are debating right now really is the fact that for some time now this Treasurer, this Prime Minister, all the ministers and all of those opposite have been going around the country saying that this tax cut is absolutely essential to jobs and growth. It is their only policy for jobs and growth in this country. They have gone around for months and months saying that it is absolutely imperative that we have this, because without it there will be no jobs and growth. In the short time since the election this tax cut has gone from essential to expendable, and now we get all these weasel words from the Treasurer about whether or not this tax cut will survive at all. This was their one-point plan for jobs and growth and that one-point plan is now in tatters.
The problem for the Treasurer, and the reason he cannot come to the despatch box and say whether or not the tax cuts still exist, is that he is in the unenviable position of knowing that he cannot keep the tax cuts, but nor can he ditch the tax cuts. The reason is that he has been given the choice between keeping the tax cuts or keeping his credibility, and, in his usual way, he has found a way to smash both. He has found a way to abandon the tax cuts, while simultaneously abandoning his credibility—it is quite an effort. It seems that if the government cannot hang on to its signature policy there is very little reason to hang on to the Treasurer. Already, we are seeing that process beginning, with the Prime Minister putting it about that the Treasurer is not quite up to the task of selling the budget and he, the Prime Minister, will probably have to do it himself. There are all of the sneaky little leaks in the pages of our newspapers, with all the colleagues on that side of the House, including the Prime Minister himself, considering that the Treasurer is not up to the task, not just of selling the budget, but he could not even get his one-point plan for jobs and growth through the parliament.
It is important to understand that these tax cuts are likely hitting the fence not because the government has come to the realisation that they are unaffordable and unfair, which is the point that Labor has been making for some time and not because of some conversion or some realisation, or finally seeing common sense. These tax cuts are hitting the fence because they are so incompetent that their highest priority, their reason for being, the whole purpose of those opposite, and they cannot even convince the parliament and the Australian community, and not even sections of the business community, that these are a good idea.
We have never supported this bill. We have not at any stage supported a $50 billion ram-raid on the budget. This budget vandalism sees more than $7 billion go to just four of Australia's biggest banks. We do not support it and we are proud that position. We are proud to support tax cuts for genuinely small businesses, the businesses that do fuel our local communities, the businesses in my area and right around the country that do work so hard and deserve some tax relief. We have supported them from the beginning. But we have not support of a tax cut for the very biggest businesses.
The reason we have never supported this bill and these tax cuts is that they will smash the budget at a time when we have a deficit that has tripled between the first coalition budget, in 2014, and now, and we have a $133 billion blowout in net debt from the day the government came to office to now. It seems just common sense that Australia cannot afford a $50 billion tax cut for the biggest businesses, which is the point made in the amendment to this legislation moved by the member for McMahon.
With a fiscal record like that—a fiscal reform of tripling the deficit and big blow-outs in debt—it is no wonder that the ratings agencies are circling this government and warning that the AAA credit rating, which matters for mortgages out in our neighbourhoods and towns and matters for confidence in our economy, is at risk because of the gross incompetence of those opposite, because of the shambles they have made of the budget. In that context we should never give $50 billion away in such an unfair way and in a way that smashes the budget. That is before we even get to the point the member for Oxley made about the $4 billion in interest that Australians would pay when the government borrowed $50 billion to give to others.
I have said it before, and I will say it again—
Ms Kate Ellis: Say it again.
Dr CHALMERS: thank you, Member for Adelaide—if you say to those opposite, 'Can we find the money to properly fund the NDIS,' they say, 'No, that's impossible.' 'Can we properly find the money to fund child care?' 'No, that couldn't possibly be done.' But if you say, 'Can we give $7 billion to the big banks?' They say, 'Of course we can.' 'Can we give $50 billion to the big companies in this country?' 'Of course we can.' They can find $50 billion then, but they cannot find it when it comes to the things that we really care about in this country: a decent social safety net or looking after people with disability.
Even their own Treasury analysis of the tax cuts, and analysis that has been done by others, shows that the growth dividends from these tax cuts, despite being such a huge cost to the budget, will have a negligible impact on growth and a negligible impact on wages even some decades down the track. They are not worth the money that the government wants to spend on them. That is one of the reasons why people from the business community have started to come out and say: 'You know what? The company tax cut the government proposes is not the beall and end-all for us.' Businesses make decisions on a whole range of issues: on infrastructure, on human capital, on the regulatory environment and on consumer confidence. All of these sorts of things matter, and it has been pleasing and it has been heartening to see elements of the business community make that point in recent weeks.
Those opposite like to claim that if we transfer this money to the bottom line of companies there will be some miraculous impact on jobs and on wages. They are failing to understand that we have got booming company profits at the moment. There are really high company profits—I think the last available data said it was a boost of about 20 per cent—at the same time that we have record low wages. That link between company profits and wages that are paid to people who do the work for these companies has been severed. We have record low wage growth and we have these extraordinarily high company profits, so the claim that somehow, if you transfer another $50 billion to the bottom line of these companies, it will have some kind of boom in wages or employment is a laughable claim. It should be dismissed.
Mr Howarth interjecting—
Dr CHALMERS: It is very tempting to take the interjection from the member for Petrie, but—
Mr Howarth: The member for Lilley supported them before and he was a member of staff.
Dr CHALMERS: The member for Petrie could not be more wrong.
Mr Howarth: The member for Lilley clearly supported them.
Dr CHALMERS: The member for Petrie comes in here and makes a laughable point. We have never supported these tax cuts, and nor should he.
Mr Howarth: The member for Lilley clearly supported them.
Dr CHALMERS: The member for Petrie has some kind of obsession with the member from Lilley.
Mr Howarth: It is the first time I have spoken about him in four years.
Dr CHALMERS: Every time the member for Petrie comes in here, he proves again why he is such a struggler in this place. The member for Petrie would do well to learn his facts before he pipes up.
Mr Howarth: Mate, I have got quotes from the member for Lilley.
Dr CHALMERS: In fact, the member for Petrie really should not pipe up in this context. Without any protection from the Deputy Speaker, who lets this fool interject over and over again without any intervention, I will just persevere.
The DEPUTY SPEAKER (Mr Broadbent): I think the member for Rankin is quite able to look after himself.
Dr CHALMERS: I do my best.
The DEPUTY SPEAKER: He does not need my protection.
Dr CHALMERS: The biggest problem with these company tax cuts is their divisive nature. In a time when we have people looking for political alternatives, in a time when we have record low wages, in a time when people are struggling to get by, the government's bright idea is to cut family payments, to support cuts to penalty rates at the same time as they give $7 billion to the big banks. It is hard to imagine a more divisive agenda than this. The member for Petrie will not be able to say whether the tax cuts are coming or staying. He is probably a few days behind as usual, and he has probably come in here not realising that the Treasurer is going to ditch the tax cuts that the member for Petrie is speaking in favour of.
Mr Howarth: Well, if you vote for them, they will not be going anywhere.
Dr CHALMERS: My advice to the member for Petrie is to go and have a gander at the papers and see that the Treasurer has abandoned this tax cut that the member for Petrie is still arguing vehemently for. You are generally a couple of days or a couple of weeks behind. I will let you catch up.
What we have got in the omnibus bill that was in the Senate last night, what we have got with the government's support for wage cuts for low-income earners, is an extraordinary contrast not just between this side of the House and that side of the House but also an extraordinary contrast between what they propose to do on that side of the House and the fair go that we cherish in this country. What they want to do over there—the member for Petrie and all of his colleagues over there on that side of the House—is make the fair go in this country an aspect of Australia's history and not an aspect of Australia's future. We will not stand for it. That is why we are proud to oppose these tax cuts that are about to hit the fence anyway, no matter what the member for Petrie says. The member for Petrie can charge into the debate saying they still should be going ahead; at the same time the Treasurer, in his office right now, is trying to work out how to slink back from these big business tax cuts.
Whether the tax cuts stay or go, they will remain an aspiration of those opposite. They will remain a symbol of the government's intention to take money from the most vulnerable people in our community and to shower largesse on the wealthiest people in our community. They will remain a symbol of this redistribution of wealth that they drool over, which is to take money from people who are on family payments or take money from the NDIS or take money from people who work on Sundays to serve them coffees. They want to see money come out of the pockets of ordinary working people, and they want to see it go to the bottom line of the big four banks. That is a disgrace.
For as long as they have that view, the Australian people will continue to turn on them. Some of them will continue to look for political alternatives in the extremes of our politics, but, mostly, people will judge them harshly for an agenda that takes money off the weakest in our community and showers largesse on the strongest. That is the main reason why are we oppose these big business tax cuts. We do not think that money should be showered on the biggest companies. We do not think that the big banks should get $7 billion tax cuts. It is very important to us. When the budget is in the mess that it is in, when the deficit has been tripled by those opposite and debt has blown out so substantially, the country cannot afford a $50 billion tax cut.
The fact that so many speakers have dropped off the list for those opposite shows they know, as we know, that these tax cuts are probably going to hit the fence. We know that when that happens not only will they be humiliated—particularly if they stand up in a moment and defend these tax cuts—but also the Treasurer will be humiliated. If the government is not prepared to cling to the Treasurer's own policy, it is hard to see how the government will cling to the Treasurer himself.