Sky News – Speers

Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia






Business tax cuts

DAVID SPEERS: With me now is the Finance Minister and Government Senate Leader Mathias Cormann, fresh from Senate Question Time. Thanks for joining me this afternoon. Look, Labor did not vote for this company tax cut above $10 million, it has never supported it. Is it a surprise to you that Bill Shorten has announced what he has today? 

MATHIAS CORMANN: What is a surprise to me is that Bill Shorten is too scared to go to his Labor caucus to advocate for higher tax on business. He clearly knows that too many people inside the Labor caucus understand that this is going to be very bad for working families across Australia, very bad for working families in Longman and Braddon. The truth is, why is Bill Shorten doing this? He is like a gambler chasing his losses. He has lost three seats. They are seats that he lost because his rolled gold guarantee was not worth the transcript paper it was written on. Here he is now, casting around to come up with ways in his mind to win those seats he lost back. What he is doing here is inflicting higher taxes on small business, higher taxes on medium sized business, not the big end of town, small and medium sized, family owned business, will hurt investment, will cost jobs, it will send jobs overseas. He is deliberately hurting working families across Australia. He did not even have the guts to front his own caucus to get them to agree to this attack on working families across Australia. 

DAVID SPEERS: What evidence is there that these businesses that we are talking about, I understand there is around 20,000 incorporated and unincorporated businesses in that $10 million to $50 million bracket. What evidence is there they really need this, that they have already started using it?

MATHIAS CORMANN: Firstly, the economy is strengthening, more jobs are being created, the evidence is there. We inherited a weakening economy, rising unemployment and a rapidly deteriorating Budget position …interrupted

DAVID SPEERS: But some of them have not got the tax cut yet. 

MATHIAS CORMANN: Our economy would be doing even better, there would be more investment and more jobs and higher wages if the Senate voted for our business tax cut proposal for all businesses in Australia in full. The truth is, Bill Shorten wants to take more of the money that small businesses and medium sized businesses have generated, that they would otherwise be able to invest in their future expansion. He wants to take more of their money away, which means that they will have less money available for the smaller businesses to become bigger businesses. We want smaller businesses to become bigger businesses, because we understand that smaller businesses becoming bigger businesses will hire more people than they otherwise would. When you have businesses around Australia growing, hiring more people than they otherwise would, there is more competition for workers, which means that businesses have to pay more to secure their services. That has always been the key ingredient for stronger wages growth. 

DAVID SPEERS: You are still trying to convince the Senate this week to support the company tax cut for businesses above $50 million. Are you willing to put a limit on that, as some crossbenchers want and deny the tax cut for those above $500 million?

MATHIAS CORMANN: No. We have made that point consistently all the way though. As Bill Shorten himself used to say, putting a cap on the turnover at which the business tax cut would essentially no longer apply, there would be a five per cent higher tax increase above a certain cap, that would be an incentive for business to downsize. That would be an incentive for bigger businesses to become smaller businesses … interrupted

DAVID SPEERS: But if you do not that, if do not do anything, you will end up with a cut off at $50 million, where it is now. 

MATHIAS CORMANN: That is your assumption. We are working …interrupted

DAVID SPEERS: I am just saying if you do not get it through, that is what it will be. 

MATHIAS CORMANN: We are working to secure the passage of very important tax reform, to help businesses across Australia, all businesses across Australia successfully compete with businesses in other parts of the world …interrupted

DAVID SPEERS: Wouldn’t it be better to get what you can this week? If you can get up to $500 million, wouldn’t you take that?

MATHIAS CORMANN: David, you are making all sorts of assumptions. Firstly, it is bad policy and none other than Bill Shorten used to say it is bad policy. Secondly, just to humour your argument, that is the Derryn Hinch proposal, which would mean that David Leyonhjelm would no longer support the business tax cuts. Putting forward a proposal that wins one crossbench Senator, but loses another, gains nothing. The truth is, if we keep taxes on businesses in Australia high, when countries around the world are lowering taxes on businesses in their countries, we are putting businesses at a competitive disadvantage here in Australia, which means we are putting workers here in Australia at a competitive disadvantage with workers in other parts of the world. Bill Shorten wants to send jobs and investment overseas. He is standing up for the big end of town in New York, in London, all around the world where business taxes are lower at the expense of Australian workers. He is selling out the best interest of Australian workers. 

DAVID SPEERS: So it sounds like you are not budging on giving the tax cut to even the biggest businesses, the banks included. Can I just get you to clarify, will you put this to a vote this week in the Senate?

MATHIAS CORMANN: That is our intention. We are not in charge of our own destiny in the Senate. That is certainly our intention. Clearly, we are committed …interrupted

DAVID SPEERS: You can put it to a vote if you want. 

MATHIAS CORMANN: We are committed to securing its passage. I do not think that there is any surprise that we will manage our program this week to maximise the opportunity for working families around Australia to have better job security …interrupted

DAVID SPEERS: But there is some suggestion this might be put off until after the by-elections. 

MATHIAS CORMANN: Our intention is to secure passage of this important reform this week. Nine out of ten … interrupted

DAVID SPEERS: Will you put it to a vote?

MATHIAS CORMANN: I have answered the question …interrupted

DAVID SPEERS: You have said your intention is.

MATHIAS CORMANN: That is our intention …interrupted

DAVID SPEERS: Is that a yes?

MATHIAS CORMANN: Our intention is to put it to a vote this week, but we will do it at a time when we are best able to secure its passage. Nine out of ten working Australians work for a private sector business. Bill Shorten wants them to be at an ongoing and deliberate self-inflicted competitive disadvantage. He wants the businesses that employ nine out of ten working Australians to be in a position to find it harder to compete with businesses around the world. That is reckless, that is irresponsible. He used to know that that was a very bad thing to do. He used to advocate the exact opposition position. He has sold out the interests of working families around Australia, trying to save his own job.

DAVID SPEERS: Finance Minister Mathias Cormann, I know you have got to get back down to the Senate. So I will let you go. Thank you very much for joining us. 


Senator the Hon Mathias Cormann, Minister for Finance, Perth