Susan McDonald (Queensland, National Party, Shadow Minister for Resources and Northern Australia) | Hansard source

I rise to speak on Labor's toxic taxes, which the coalition will fight tooth and nail. If the CGT changes, the negative gearing changes and the death tax hidden in the trust rules become law under Labor, a coalition government will repeal them. When the government taxes something, you get less of it. You get less housing, less saving, less investment and fewer small businesses. We will back aspiration and reward hard work by scrapping these taxes.

Last week, in the highly rushed and poorly executed Senate Economics Legislation Committee's inquiry into this toxic legislation, it was clear that the Albanese government's proposed capital gains tax changes would devastate Australia's mineral exploration sector, and those opposite will not do a thing about it. The Association of Mining and Exploration Companies told the committee the changes would directly target the retail investors who provide the lifeblood of junior exploration companies. When the peak body that represents more than 550 mining and exploration companies warns that Labor's tax changes will starve junior explorers of capital, the government should be paying attention, but they're not.

Australia's mineral exploration industry is our pipeline for future mines, future jobs and future economic growth, as well as energy sovereignty. AMEC told the committee that about 75 per cent of Australia's economic mineral discoveries are made by small- and mid-tier explorers, yet most rely heavily on mum-and-dad investors willing to back high-risk projects. AMEC warned that if these investors walk away because of Labor's tax changes exploration activity will fall, discoveries will decline and mining projects may never be developed. We know that new mines don't develop overnight. They definitely won't appear overnight and provide jobs under Labor's safeguard mechanism carbon tax or the overreach of the EPBC legislation, and now they definitely won't be incentivised by these tax changes.

Discovery to production for a mine can take up to 16 years. If exploration investment dries up now, Australia will be paying the price for years to come. These are the future jobs of our children today. We know that self-starters are what built this great nation. The resources sector is what built this great country. But what's even more concerning to me is this CGT problem is compounded by Labor's decision to abolish the highly successful Junior Minerals Exploration Incentive in 2025. Labor has already removed one of the few Commonwealth programs supporting exploration and is now proposing tax changes on top of that, so there is now nothing that will further encourage that incredibly important investment.

The coalition introduced the Junior Minerals Exploration Incentive in 2017 to encourage investment in greenfield mineral exploration by allowing exploration companies to pass tax credits on to Australian investors, and it was hugely successful. The program delivered $105 million between 2018 and 2021, with the coalition extending a further $100 million from 2022 to 2025.

Despite the program's strong industry support and proven success in attracting investment into exploration, the Albanese government allowed the program to expire in 2025. The program cut by Labor had unlocked more than $1.1 billion in capital and $400 million in exploration spending. That's a huge return, and it's a huge loss now that it's gone.

We've already announced that a coalition government would reinstate the Junior Minerals Exploration Incentive program with a $100 million commitment, including $50 million dedicated specifically to oil and gas exploration. With what we have just experienced in the Middle East, it's clear we need to pump the gas and get our resources sector unlocked so that we're never reliant on geopolitics again.

Only the coalition back Australia's resources industry, because we understand it underpins national prosperity and our energy and manufacturing sector. At a time when Australia needs more critical minerals, more resource investment and greater sovereign capability, Labor is making it even harder to discover the mines of the future.

AMEC also told the inquiry last week:

The government's Critical Minerals Strategy … says the world needs '50 new lithium mines, 60 new nickel mines and 17 new cobalt mines to meet carbon emissions goals' by 2050. It therefore seems counterintuitive to make exploring for these minerals fundamentally harder in Australia, but that is what the proposed CGT reforms do. The proposed reforms seem to undermine the government's own agenda.

Doesn't that say it all? This means there's no Commonwealth support to junior minerals explorers but a new tax and obstructive legislation.

That may explain why, in the recent budget papers, there is a forecast—in the government's own budget papers—of a zero per cent growth rate in the mining industry by 2027-28. The International Energy Agency report shows a 30 per cent reduction in mining investment in Australia at a time when that investment is increasing in Asia and in other countries that understand the importance of the critical minerals sector. That's disgraceful.

This is another decision sending the wrong signal to investors at a time when Australia should be strengthening its global competitiveness in resources and critical minerals. Labor talk endlessly about critical minerals and future industries, but, when it comes to backing the companies actually searching for these resources, they're missing in action. This is yet another example of Labor making Australia a harder place to invest. Mining investors say the tax payable on successful exploration investments would almost double, destroying the risk-reward balance that underpins junior exploration. Junior explorers already face enormous risks in trying to raise capital to search for the next generation of Australian mines. Without exploration, there are no new mines, no new regional jobs and no future pipeline of critical minerals and resource projects.

Labor wants to punish the mums and dads who back these projects. Labor simply does not understand that, if you stop exploration today, you destroy mining tomorrow. Our message to those targeted by this budget is simple: we are going to back you to be its future. You work, you risk and you should get ahead. No-one voted for these new taxes. The Prime Minister promised in his own words, more than 50 times before the last election, that he would not introduce them. In an act of complete bad faith and disregard for the Australian people, he turned around and broke every single one of those commitments.

The coalition opposes schedules 1 and 2, supports schedules 3 and 4 and calls on the government to immediately pass laws to end bracket creep and implement a tax back guarantee by indexing the personal income tax brackets to inflation, starting with the first two tax brackets in 2028-29 and the remaining tax brackets from 2031-32. The coalition notes that this will deliver lower income taxes permanently to all Australians and ensure that income tax cannot rise without the passage of new laws.

The Senate inquiry was a farce. It was performance controlled by the government to ensure only a few of the many submissions could be uploaded and scrutinised and only a few of the many interested organisations, companies and parties could appear to give evidence. The government restricted the number of days available to hear on this important issue. The government restricted the resources available to the Senate committee to allow it to properly do its job. The government reduced the technology available for the live streaming of proceedings, something that is core to our democracy. This government is wilfully and devastatingly changing Australia. It's making investment in the businesses that pay the bills in Australia impossible. Labor is making us poorer.