Senate debates

Wednesday, 14 February 2018

Questions without Notice


2:15 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

I thank Senator Di Natale for that question. I make the same point to him as I made to Senator Watt, and that is that in Australia companies pay tax on their profits, not on their revenue. While I don't comment on the individual tax affairs of individual companies, the general point I would make is that the level of investment that is taking place in the context of opening up the Galilee Basin for increased coal exports of Australia of course provides many benefits to Australia. It generates many jobs, and these jobs, of course, are paid for by businesses investing in Australia. Those employees working for businesses being profitable and successful in Australia themselves pay taxes, and many small and medium sized businesses in Australia provide services to larger businesses in Australia that are making investments in Australia.

If you are suggesting that businesses in Australia should pay tax on their turnover then you should say so clearly—or are you suggesting that any Australian company that makes a loss should pay tax? Allowing losses to be offset against future profits is a standard feature of most income tax systems. Restrictions on the carry-forward of losses used to exist in Australia. However, they were removed by the Labor government back in 1990, and that was a good decision. If the opposition is suggesting that a higher company tax rate will make us more competitive in the future, and if the Greens and the Labor Party think that it will boost investment, jobs, wages and growth in the future, then they should put forward, as a concrete policy proposal, the proposition that tax should be imposed on revenue rather than on profits. I guess that the Greens and the Labor Party may be suggesting that Australian companies like the ones that have been mentioned should pay tax before they pay their employees. That, of course, is the implication of what Senator Di Natale is asking there.


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