Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

Budget day 2015 was a great day for my electorate of Ryan. It was a great day for families, with the announcement of the new, simpler childcare subsidy package that will mean families with household incomes between $65,000 and $170,000 will be around $30 a week better off when it comes to accessing child care. It was a great day for older Australians, with the government confirming that we will not sign up to Labor's punitive tax on hard-earned superannuation income. But, above all, it was a great day for the 13,000 registered small businesses in my electorate and, in particular, those which have an annual turnover of less than $2 million per annum.

These bills turn the Treasurer's budget night speech from words into deeds. They seek to reduce the company tax rate from 30 per cent to 28.5 per cent for companies with an aggregated turnover of less than $2 million from the income year commencing on or after 1 July 2015. These bills also ensure that the maximum amount of franking credits a small incorporated business will be able to distribute each year will not be reduced in accordance with the reduced tax rate. This means that small incorporated businesses will still be able to distribute franking credits to their shareholders at the same 30 per cent rate as large companies can. The effect of these changes will be that, from 1 July 2015, Australian small businesses will enjoy the lowest rates of company taxation seen in Australia since 1967, 48 years ago.

This bill will create a two-tiered corporate tax system, and the coalition makes no apologies for this. Our policy is clear and unambiguous, which is more than can be said for Labor. In recent weeks, they have demonstrated once again why they cannot be trusted when it comes to small business policy. Take this contribution from the member for Oxley and shadow minister assisting the leader for small business. You would think that, of anybody in the Labor Party, he would really be on the pulse with what small business wants, and yet he is quoted in a media release from 6 May 2015 as saying:

The Liberal's plans to put in place a two-tier tax system in next week's Budget will only serve to smash business confidence ever further.

But, barely two weeks later, the Leader of the Opposition in his budget reply speech directly contradicted the member for Oxley by committing the opposition to match the coalition's tiering of the company tax. Yet again, this shows that Labor have no consistency when it comes to small business policy, probably because they do not truly understand it.

As this bill demonstrates, we are unashamedly a pro-small-business party. As a party and as a government, we believe that small businesses are the key drivers of Australia's economy, underpinning growth and innovation and providing jobs for millions of Australians. As the only party who truly understand small business, we know that small businesses face particular challenges with cash flow and with competition with larger businesses. Times are tough for small business, and as a government we need to do all we can to incentivise small business to grow, to invest and to employ more Australians.

This bill now gives me the further opportunity to discuss what I consider to be the most broadly welcomed measures introduced in this budget—or, indeed, in any budget in recent memory. I am talking about the announcement that small businesses will, from 7.30 pm on 12 May 2015, be able to immediately deduct from their tax business assets valued at up to $20,000. To say that this has been well received would be an understatement. Industry groups have been lining up in support: the Australian Chamber of Commerce and Industry, the Council of Small Business Organisations of Australia, the Chamber of Commerce and Industry of Queensland, the New South Wales Business Chamber, Business South Australia, the Institute of Public Accountants, the Chamber of Commerce and Industry Western Australia, Independent Contractors Australia, the Australian Food and Grocery Council, the Australian Industry Group, the Business Council of Australia and the National Retailers Association—the list goes on and on, each organisation more supportive than the last.

The reason for this is simple. Members will know that I ran my own business for many years prior to entering this place. Ask any small business person what is the biggest day-to-day pressure faced by their business and chances are that the words 'cash flow' will be on the tip of their tongue and placed high at the top of their list. Cash flow is a constant challenge. It is what keeps business owners up at night. Many small businesses lack the scale or the credit history to be able to access significant credit lines. In a business where cash flow is tight, owners will be reluctant to invest. Investing in capital equipment to grow the business ties up cash, and until now the part that could be claimed back in depreciation took several years to flow. With this budget, small businesses will be able to claim it back immediately on each and every purchase up to $20,000. That means up to $5,700 back, immediately, per transaction. In my electorate of Ryan I am already hearing from businesses who are taking advantage of the changes in this budget to bring forward investments that will grow their businesses. Following the budget, the Treasurer and I visited one such business—Briki Espresso and Gelati Bar, in the suburb of Ironside. There we met—

Debate interrupted.