Wayne Swan (Lilley, Australian Labor Party) Share this | Hansard source

I wish to commend Dr Leigh on moving this motion but lament the fact that we need to move the motion in the first place. The Labor Party has always been committed to ensuring that everyone, including large multinational companies and wealthy citizens pay their fair share of tax so that working families and small businesses are not disadvantaged by having to take on a higher tax burden in the future as a result of rampant tax minimisation by some multinational companies—pushing up tax rates for working families and for small business. We understand that we need to ensure that our system is competitive and attracts investment, but the best tax system is one that is fair and progressive. During my time as Treasurer, we acted to prevent these tax minimisation strategies, which were aggressive and which were leaching our revenue and pushing tax rates up for working people and other small businesses. That is why there was a comprehensive package in 2012-13 budget to crack down on this profit shifting overseas and rampant tax evasion.

The very first act of the new government was to wind back this package. They knocked off $1 billion worth of revenue measures which were stopping multinational companies from avoiding tax and pushing their profits overseas. We were fairly aggressive in putting in place a range of measures to ensure that there was an exchange of information with other countries and, indeed, the Swiss agreement was put in place by our government.

What we were doing through this period was closing loopholes which were actually opened by the Howard-Costello government over a decade. That is why we needed these measures which would have brought $4 billion of revenue, and the government has already shred $1 billion of that. This is on top of its first act, which was to throw away $12 billion in revenue which otherwise would have been paid by multinational mining companies and other large power companies by knocking off a carbon price, knocking off some fairness in the superannuation system and then knocking off measures to stop rampant tax evasion. So it was not surprising that almost the first act of this government was to give away $1 billion in revenue that was contained in our BEPS package to multinational companies.

All of this happened at the same time as the government doubled the deficit in its first midyear update. It followed that with hitting the sick, the unemployed and pensioners with savage cuts and tax increases, precisely as it was doubling the deficit and giving away billions of dollars of revenue. That is why we say this is a government which is strong in taxing the weak and weak in taxing the strong. It is a government that is not serious about charting a pathway back to surplus because, if it were, it would not be giving away the revenue.

You only have to look at the coalition's record here. They consistently opposed all of the measures under our government where we were seeking to plug these loopholes in the system. Now they use the excuse that they cannot move so fast because they need some sort of international cooperation. That is bunkum. They do not need that. What they need to do is to get down and raise the revenue. What this is really about is that the government are blowing out the deficit as the excuse to seek the public permission for the harsh cuts that they are seeking to impose. That is why they are blowing out the deficit. They are so embarrassed they did not admit to these goals prior to the election, so they say, 'We'll give away the revenue, we will blow out the deficit and then the public might accept these cuts.'

What we need in this country is a balanced approach about the return to surplus which will involve concentration not only on the spending side of the budget but also on the revenue side of the budget. This government has created a problem with its revenue. It has done that by giving big tax breaks to all of its mates. We on this side of the House have consistently acted on multinational tax minimisation—some may even call it evasion. We have acted on BEPS at the same time that these people have been getting massive tax cuts from those on the other side. This is a government that claims it is open for business. It is open for business alright—open to giving huge tax cuts to a select number of very large multinational companies on the one hand and, on the other, jacking up taxes and the burden on those who are most vulnerable. This is all about an underlying agenda to put the tax burden on working people and take it off the very large corporates. (Time expired)

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