Madeleine King (Brand, Australian Labor Party, Shadow Minister for Consumer Affairs) Share this | Hansard source

I too rise here today to speak on the Treasury Laws Amendment (Lower Taxes for Small and Medium Businesses) Bill 2018. In essence, this bill accelerates the reduction of the corporate tax rate for small to medium enterprises, which for the purposes of this legislation means businesses with a turnover of less than $50 million. The corporate tax rate will be cut from 27.5 per cent to 26 per cent in 2021, then later to 25 per cent from 2021-22. In addition, this bill increases the current small-business income tax offset rate of an eligible individual's basic income tax liability that relates to their total net small-business income, first to 13 per cent and then later to 16 per cent. This bill seeks to benefit 3.3 million businesses, which employ 6.6 million Australian workers. This tax relief will provide Australian small businesses with confidence to undertake new investments and to deliver more jobs across the country.

Growing up with my mum having run a local drapery store in my hometown of Rockingham, I have experienced and know firsthand the unique challenges facing small business owners across this country. These are the people you will see first thing in the morning; they are opening up a drapery store, a cafe or a hardware store—although, sadly, those are getting fewer and fewer. They are the people who you will see who might be filling in for a worker who has had to call in sick, or they have their unwell younger children in the workplace with them because they are not able to take the day off. Or they have the kids in with them at work because they are not able to pick them up from school, or because they are unwell or for unforeseen circumstances. They help to run our economy and employ by far the majority of employees throughout the country, and they keep the country running—there is no doubt about that.

Since my time of being elected, and in my time assisting in the small business portfolio, I have thoroughly enjoyed meeting with local businesses and conducting round tables in my electorate of Brand—in Rockingham and Kwinana. I am always happy to hear from my local small business community. The Rockingham Kwinana Chamber of Commerce is a remarkable resource for local businesses. They have many members, and I'm always pleased to speak to them whenever they'd like me to. Sometimes I turn up at their fantastic functions unannounced, because they are such fantastic functions.

I have to say that the Rockingham Kwinana Chamber of Commerce has been helpful in facilitating engagement opportunities for and with these businesses. Small businesses are the driving force of our local economy across the communities of Rockingham and Kwinana. I would like to take this opportunity to thank the chamber and its hardworking CEO, Tony Solin—we went to the same school, at Rockingham Beach Primary School—and his hardworking offsider, Diana White; president, Basil Paperone, who runs one of the best grocery stores across the district, down at Malibu Fresh Essentials; and vice-president, Rob McGavin, who of course went to school at Rockingham High School with my brothers.

I look forward very much to working with this community and the Rockingham Kwinana Chamber of Commerce for many years to come. I thank them for their ongoing support and for the work they do in helping small businesses access various bits of advice from the state government and also from the federal government and local government.

Through my engagement with this small business community I have heard their primary concerns. I've heard they have a lack of cashflow at times due to late payments—delayed invoicing and payments of invoices from big business—and also sometimes from the lack of capital from banks. They are simply not able to access that, and this does cause them issues. These small businesses are the bread and butter of this nation. They employ millions of people, and this tax relief package is one that we support. It will help to mitigate some of these challenges. It will drive investment and support new jobs in growing industries for owners and workers alike.

I would like to reflect for a moment on this government's economic plan. As we know, it's the one-point plan for economic growth, and that one-point plan was a big business tax cut, $17 billion of which was going to the big banks and 60 per cent of which would have travelled offshore. Yes, plan A for this government was a big business tax cut, and didn't that go well? The signature single-point plan cost the former Prime Minister his job. Now, with that plan thoroughly off the table, they have another plan, which is to help out small and medium-sized enterprises.

The government has brought these tax cuts forward, and Labor will support the legislation to bring them forward. It's important that we provide small business with certainty. The Australian people need to know, and small businesses across Australia need to know, that it doesn't matter who wins the next election: taxation for small business will remain the same. Labor is a strong supporter of small business and we always have been. With a Shorten Labor government, 99 per cent of businesses will receive a tax cut, no business will have their tax rate increased and all businesses will be able to plan and invest with confidence and certainty.

Labor supports the small business taxation legislation as it provides certainty to small businesses ahead of the next election. However, unlike the coalition, Labor will deliver tax relief for small businesses without cutting funds to schools or hospitals or increasing the national debt. Labor has taken difficult decisions to be able to fund its policy commitments, such as making multinationals pay their fair share of taxation and reforming negative gearing, the capital gains tax discount, the tax treatment of trusts, managing tax affairs and, of course, dividend imputations. The Liberals have not paid for bringing forward these tax cuts to small and medium-sized businesses, but rest assured that Labor will.

The Liberals have abandoned their budget rules and they have no fiscal credibility. They've doubled net debt since coming to office, and the deficit for this year is double the amount compared to what they first forecast in the 2015 budget. As outlined by my colleagues before me, our Labor team will accommodate the cost of this bill in our budget bottom line by delaying the introduction of the Australian Investment Guarantee by 12 months, building on our record of hard and sensible budget decisions to pay for our priorities.

Once implemented—acknowledging a delay of 12 months—Labor's Australian Investment Guarantee will allow all businesses in Australia to immediately deduct 20 per cent of any new eligible asset worth more than $20,000, with the balance depreciated in line with normal depreciation schedules from the first year. Unlike previous asset write-off schemes, the Australian Investment Guarantee as promised by Labor will be permanent. It means businesses can continue to take advantage of the immediate tax deductibility whenever they make a new investment in an eligible asset.

Labor is a great supporter of small business, in contrast with the Liberal government's record—they've delivered five years of chaos and division on energy policy, which has seen Australia's wholesale power prices double. Australian small businesses now pay among the highest electricity prices in the world, reducing their cash flow, productivity, profitability and ability to maintain employment. They dropped the National Energy Guarantee, another signature policy that cost the former Prime Minister, Malcolm Turnbull, his job. Now it's a policy vacuum costing Australian small businesses across the nation.

This is the same Liberal government that has mismanaged the most critical infrastructure project of the 21st century for Australia's small businesses: the National Broadband Network. Despite promising universal access to minimum speeds of 25 megabits per second by 2016, the Turnbull government's technologically inferior NBN will not reach many small businesses until 2019 or later, and then it will deliver speeds that are well behind those of key trading partners and competitors, such as Korea, Japan and New Zealand.

The most fundamental change facing small businesses around the world is the rise of ecommerce. You can and often do compete with businesses around the world, not just those in your neighbourhood. NBN Co recently released its updated pre-election corporate plan containing yet another $2 billion cost blowout to the Liberal's second-rate NBN. In 2018-19, 1.3 million premises will have their connections delayed. The project is now $22 billion over budget and four years behind its promised delivery date.

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