Senator the Hon Mathias Cormann
Minister for Finance
Deputy Leader of the Government in the Senate
Senator for Western Australia
The Hon Malcolm Turnbull MP
The Hon Scott Morrison MP
PRIME MINISTER: Good evening. Company tax, business tax is a tax on workers, a tax on jobs, it is a tax on wages.
Today we have delivered a tax cut for over three million small and medium Australian businesses, employing 6.5 million Australians – that’s more than half the entire Australian workforce. This reform means that we have now delivered the entirety of the tax cuts we promised to deliver in this term of Government. We have delivered these tax cuts, the first stage of our ten-year Enterprise Tax Plan and businesses with turnovers in this year of $10 million, $25 million, $50 million will benefit.
The beneficiaries will be Australian workers because the firms for which they work or which they own in the case of the smaller businesses, they will be able to invest more, grow more, employ more. That is the fundamental leverage that cutting business tax delivers.
More growth, more jobs and it makes Australia more competitive.
Now, at the same time we have as part of our agreement with the Nick Xenophon Team been able to confirm our existing commitments to ensuring a reliable and affordable energy supply in Australia.
We have our made our commitment to ensuring that there is adequate gas supplies in Australia for the domestic market. And confirmed that if the industry does not respond with the supplies that the market needs, we will use our authority, our power over exports to ensure that adequate gas supplies are available.
And Rowan Ramsey, the Member for Grey in South Australia, Rowan during the election campaign promised that we would support a new solar facility in Port Augusta. We are able to confirm our commitment to that that was made by him and Industry Minister Greg Hunt during the course of the election.
So we are making strong commitments, supporting families, supporting businesses and we are doing so in a way that will back them, back their enterprise and at the same time carry on our commitment and our polices to support affordable and reliable energy. Treasurer.
TREASURER: Thank you Prime Minister. This is a great day for people, Australians who work in small and medium sized businesses. The Prime Minister has said more than half of the Australian work force will benefit from these changes.
I want to particularly commend Mathias Cormann and the entire Senate team for the excellent job they have done in working these measures through the Senate. At the last election, after the last election, there was a view that said that the Government wouldn’t be able to get things through the Senate. The Prime Minister and the Finance Minister and the entire team have demonstrated, whether it’s the $25 billion of thereabouts in Budget improvement measures that we have been able to get through the Senate and now today the first stage of the Enterprise Tax Plan.
As the Prime Minister has said, this delivers in full every single tax cut, not just for companies but also personal income tax previously, that was to be coming into effect in this Parliamentary term has hit the ground and it has hit the ground running.
Now, this is a great day for Bowmaker Realty up there in Brisbane in the electorate of Petrie, a turnover of just over $2 million. Zokoko, a chocolatier out in Penrith. Tyres & More up in the Adelaide Hills in Boothby. Precise Machining & Manufacturing, a company transitioning from the auto industry into new industries – great news for them. WB Truck N Trailer down in Burnie, they are getting the tax cut. Australian Honey Products in Launceston – they are getting the tax cuts. Australian Precision Technologies out in La Trobe, part of the defence industry supply chain, they are getting the tax cut. Martin Locke Homes up there in Townsville. These are the businesses that we went to at the last election and said we are going to give you a tax cut to get the tax monkey off your back so you can invest more in your business so you can grow your business and you can see better days ahead for your employees and that is what this Government has delivered and I want to thank the Prime Minister for his strong leadership on this and I want to thank the Finance Minister for the outstanding job he has done in bringing this home.
PRIME MINISTER: You have done a great job Mathias, you have brought the crossbench on board and a great outcome.
TREASURER: There is one thing I have to say Prime Minister, for the purpose of the Australian Tax Office, the Government will support the amendments in the House. That means that the Tax Office can now tell tax practitioners that those tax cuts that are effective this year for businesses with a turnover up to $10 million take effect this year.
Over to you Mathias.
MINISTER FOR FINANCE: Thank you Treasurer. Thank you Prime Minister. Tonight is a great outcome for hardworking families across Australia wanting to get ahead. Helping businesses across Australia be more successful, helping businesses across Australia be more profitable, helping them invest in their future success, will help ensure they can hire more Australians and pay them better wages over time. That is why we have been pursuing this as a part of our plan for the economy and jobs that we took to the last election and it is very satisfying that tonight we have been able to deliver for hardworking families across Australia.
PRIME MINISTER: Before we go to questions, can I just make some observations about ex-Tropical Cyclone Debbie – our thoughts are with the people of Queensland and Northern New South Wales that have been affected by the destruction, rain and flooding caused by this severe weather system.
Sadly, a woman’s body has been found in flood waters on a farm in Murwillumbah in New South Wales and our sympathies go to her family and her friends.
As we observed yesterday in Queensland, nature has flung its worst at Australians and it brings out the best in Australians – the resilience, the solidarity of the communities and the extraordinary response of the emergency services supported by the Australian Defence Force right across the nation.
It makes every single one of us proud. I have spoken today with the Mayor of Lismore, Isaac Smith and with the local Member Kevin Hogan and the flood there is likely to remain at the current level right through until Sunday.
There has been a lot of damage caused by the floodwaters in Queensland and South East Queensland, North Queensland and now in Northern New South Wales, as I said. It is likely to worsen throughout the week as the river levels rise so this is a time to be safe. Follow the advice of the authorities – do not walk, swim or drive through flooded waters. If it is flooded, forget it. That is absolutely fundamentally important advice given by the authorities. Follow the advice of the authorities and you can assure your safety and that of your family.
JOURNALIST: The tax cuts are obviously being phased in so they start with businesses with a turnover of $10 million or less, but are those businesses all going to get to 25 cents?
PRIME MINISTER: Yes, they will.
JOURNALIST: What is the time frame? How will that work?
TREASURER: 2026-27 they get to 25. They first drop down to 27.5, down to 27 in 2024-25. So that is when they drop to the next level and 2026-27 they are 25.
JOURNALIST: Prime Minister, the business groups have congratulated this development but they have also called for you to stay committed to the remainder of the plan.
PRIME MINISTER: We are committed and what we have now legislated, the Senate has legislated today is the first three years of the plan, the first stage of the plan, all of that plan that was to be delivered in this term of government and we are committed to the whole plan, the whole ten-year plan. And I’d just say as I said in the House of Representatives yesterday that I believe as you see the reductions in company taxes elsewhere in the world, particularly those foreshadowed in the United States, you will see the case for reducing company tax in Australia will become stronger because the competitive pressures will intensity.
JOURNALIST: So what does that mean PM? When would you look to bring back the remainder of this package? Is that six months from now, is that a year from now?
PRIME MINISTER: It is when we believe we can secure a majority in the Senate.
JOURNALIST: Nick Xenophon of course wanted an emissions intensity scheme. You didn’t want to go that far but you’ve directed the Climate Change Authority to look at some measures. What are we actually talking about there?
PRIME MINISTER: Well as Mathias set out in his remarks in the Senate which I listened to – what we have agreed to do is, we have confirmed our commitment to a number of measures, particularly relating to the gas market which are already part of our policy and which we have foreshadowed.
In terms of power affordability and reliability, what we have agreed to do is to arrange for the AEMC and the Climate Change Authority to produce a report that provides advice with respect to policies on affordability and reliability. That will inform the Finkel Review and that will be a device that we will take into account as we pursue the implementation of a power affordability and reliability policy which is our commitment. And the whole purpose of our energy policy and all of the work we are doing, whether it is the work with Snowy Hydro 2.0, the action I have taken with respect to gas supply, the Finkel Review, all right across the board, all of it is focused on ensuring that Australians have affordable and reliable energy including electricity and gas and at the same time we meet our commitments to reduce emissions under the Paris Agreement.
JOURNALIST: So it is not talking about doing anything for safeguards mechanism or applying penalties?
PRIME MINISTER: No it is exactly as Mathias described it and as I just described it then.
JOURNALIST: Prime Minister, when can pensioners expect to receive their one off payment to help with electricity costs?
PRIME MINISTER: Yes, Mathias can answer that.
MINISTER FOR FINANCE: The commitment is there for all to see. The cost, as I have indicated in the Senate is $260 million. It is a one off payment. The specific arrangements will be made in the context of the Budget.
JOURNALIST: But will they not go forward if there, there seems to be some reference if there was downward pressure on prices that you wouldn’t deliver that?
MINISTER FOR FINANCE: This one off payment is a commitment. It is a firm commitment that we have made. The thinking behind the proposition that the Xenophon team has put to us is that once all of the Government’s policies to bring down the cost of electricity, making energy more affordable and more reliable into the future coming into effect, pending that process and pending those outcomes being achieved, that this will help pensioners and people on parenting payments to deal with electricity costs this year.
JOURNALIST: Mr Turnbull, you mention in your opening remarks a couple of these so-called measures you gave to Senator Xenophon were actually already Coalition policy like the pipeline study, the gas, you know, the things you are doing on both the pipeline sector and the export threat. Did you get him pretty cheap in the end? Xenophon – get him pretty easy?
PRIME MINISTER: Look, we really appreciate the support of the crossbench. You know, this 45th Parliament, as you know, as many of you have said to me from time to time, you’ve expressed skepticism about our ability to legislate in the 45th Parliament. And yet, you know, here we are just in the last two weeks we have secured the passage of our child care reforms. We have secured the passage of the first stage of our ten-year Enterprise Tax Plan plus all of the other legislation we’ve seen pass through the Senate - the commitments we made in the election to restoring the ABCC, the Registered Organisations Commission and so forth. We are ensuring by working with the crossbench and I joined with Scott in complementing Mathias on his ability to work with the crossbench, win their support to enable to us to legislate.
JOURNALIST: Given the successful negotiating of the Treasurer, will you commit to keeping him as your Treasurer after the Budget?
PRIME MINISTER: Absolutely. I’ve got these two, these two are pillars of the Government. And I have got a great team, I have really got a great team and this has been a great result. You know, I know that it is easy here to write it up in terms of politics – this is a great result for 6.5 million Australians, working for businesses that will get the benefit of this tax cut. And what that means is that their businesses, where they work will have the means to invest more, to pay them higher wages, to grow. This is a real stimulus to growth and to employment. It is a great day for Australian workers, for Australian businesses to making us more competitive and more productive.
I want to thank you all very much for joining us here tonight.