by Jacob Greber Australian Financial Review
The Senate’s resistance to extending to big business the tax cuts it delivered small firms earlier this year means the reductions will ultimately become “meaningless” for jobs and growth, says a new coalition of small, medium and large employers.
“If big business isn’t investing, if big business isn’t building things and creating new opportunities, then that means small business as a group will find less opportunities,” said Peter Strong, chief executive of the Council of Small Business Organisations of Australia – the peak lobby group for family and small business.
Mr Strong delivered the warning while speaking alongside Business Council of Australia chief executive Jennifer Westacott in a show of unity between the two groups, whose interests have aligned over the issue of company tax cuts.
The push by COSBOA – whose members have already benefited from tax cuts delivered earlier this year by the Senate – indicates growing concern that the reductions need to be broad-based to have a real impact on the economy.
“We need to recognise that the business community is one interdependent community,” Ms Westacott said at the joint press conference in Parliament House on Thursday. “There is no small business without big business, there’s no big business without small business.”
Citing more than half a trillion dollars in economic exchange between small and large businesses, Ms Westacott said it was imperative that Parliament recognised the need to make the tax rate competitive for all.
Labor and the Greens are strongly opposed to the Coalition’s company tax cuts, saying they benefit largely foreign investors, and the Nick Xenophon team supported reductions only for companies with turnover below $50 million.
The government has returned the legislation to Parliament, to pressure the Senate into rethinking its opposition to a more comprehensive reduction in the company tax to 25 per cent from 30 per cent.
Mr Strong’s intervention signals a fresh determination by the lobby groups to convince crossbench Senators of the need to maintain consistency in the tax rate, regardless of size.
He indicated he would urge opposition treasury spokesman Chris Bowen to recognise that the tax cuts should not be used for cheap political gain.
“[Labor’s] certainly receiving, as far as I can see, a lot of pressure from the union movement, who are seeing this as a good wedge – it’s just a political wedge.
“It’s not anything that makes sense otherwise. If [unions] want jobs then you’re going to have to support good economic change, and in the past – going back probably 10 or 15 years – the union movement has supported this approach.”