Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Hansard source

The first thing I can say is that it is not Labor Party policy to encourage smokers to kill themselves by smoking and therefore provide a saving to the health budget, as my friend Senator Minchin suggested. It is a novel response but not one this government will be adopting. I heard Senator Conroy talking about elasticity of demand and I thought, ‘God, that brings back terrible memories of economics tutorials,’ but I think in fact he is probably right in terms of the answer. The tobacco excise increase is going straight into health spending. We are using that money to deliver a better health system for Australians. As the senator well knows, there is a huge cost to the Australian health system as a result of the health impacts of smoking. So the excise increase is going to go straight into health spending and trying to boost our capacity to provide better health services for the Australian population.

The Resource Super Profits Tax will be devoted to new reforms to try and improve economic growth and make the tax system fairer and simpler. It is directed at supporting measures we propose, such as cutting the company tax rate to 28 per cent. I think everyone would recognise that that will be a very important achievement if we can achieve it. It is also about providing the $5,000 instant asset write-off for small business. It is about paying for the resource exploration rebate, which I think is a really important initiative for miners in our home state, Senator Back. We have done the economic modelling on the impact of the Resource Super Profits Tax. We do believe the industry will continue to grow, and all the independent economic modelling suggests that the economy will continue to grow. (Time expired)