Malcolm Turnbull to put corporate tax rate plan before the Senate
FRESH from a victory on his personal income tax cuts, Malcolm Turnbull will attempt to pass the controversial $35 billion cut to Australia’s company tax rate.
National
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FRESH from a victory on his $144 billion personal income tax cuts, Malcolm Turnbull will attempt to pass a $35 billion cut to Australia’s company tax rate next week.
Finance Minister Mathias Cormann has confirmed the government will put its plan to cut Australia’s corporate tax rate from 30 per cent to 25 per cent before the Senate next week.
The government has yet to secure the eight crossbench votes it needs to pass the bill, after Pauline Hanson reneged on her support last month and crossbenchers Derryn Hinch, Tim Storer and the Centre Alliance team remain unconvinced.
MORE: Malcolm Turnbull’s personal income tax cuts pass Parliament
MORE: Hanson reneges on company tax support
But after passing the full seven-year personal income tax cuts package yesterday with the support of all crossbench senators except Senator Storer, the government is redoubling its efforts to negotiate for the company tax cuts.
“The job in front of us is to ensure that we can convince at least eight senators on the crossbench to support the Government’s proposal for a lower, globally more competitive business tax rate,” the Finance Minister told ABC’s News Breakfast program today.
“Nine out of 10 working Australians work for private sector business — their future employment, job security, career prospects and wage increases depends on the success of the businesses that employ them,” Senator Cormann said.
“If we continue to put them at a competitive disadvantage with businesses in other parts of the world, we will be hurting those nine out of 10 working Australians. That is not something we want to do. We want all Australians to have the best possible opportunity to get ahead.”
The tax cuts are unlikely to pass without One Nation’s support.
And Senator Hanson, who is battling a by-election in the Queensland seat of Longman next week, has indicated she will not back the controversial plan.
But Senator Cormann said the government remained “absolutely committed” to the reform.
He confirmed today the government was still considering Senator Hanson’s request to launch a new apprenticeships program.
Treasurer Scott Morrison is also preparing to release the details of a Treasury paper on suggested taxes to target online companies, which could go some way to addressing One Nation’s calls for more action to crackdown on multinational tax avoidance.
Prime Minister Malcolm Turnbull today hailed the passage of the personal income tax cuts as a “great win for Australian families”.
He was adamant the federal budget could afford the $144 billion package, which will initially provide tax relief of up to $530 a year for low and middle income earners.
“It’s all budgeted for,” Mr Turnbull told the Nine Network’s Today Show this morning, saying the nation had “turned the corner on debt”.
“We are guaranteeing essential services, health, education, infrastructure, defence, national security, we’re bringing the budget back into balance a year early, living within our means and hard working Australian families are able to retain more of the money they earn,” he said.
“This (the tax cuts) means a family where the mum and dad both earning … middle income salaries of $75,000, $80,000 will be getting over $1000 more money back from the tax man next year, so that is an achievement in the here and now for next financial year which begins on July 1 obviously.
“But over the longer term, after ‘24-25 we’ll have a tax system that is massively reformed, so from $41,000 all the way up to $200,000 for every extra dollar you earn you won’t pay more than 32.5 per cent tax.
“We get rid of a whole tax bracket. It results in a tax system is that is fairer and simpler and encourages and rewards aspiration.”
Millions of Australians will get a tax cut under the package, which starts with a tax rebate of between $200 and $530 for people earning up to $90,000.
The plan will then address bracket creep, by lifting the 32.5 per cent tax bracket ceiling from $87,000 to $90,000, delivering an immediate tax cut of up to $135 for about three million workers from July 1 this year.
It will then lift the ceiling to $120,000 from July 1, 2022, delivering tax breaks of up to $1350 for about 1.8 million taxpayers.
The 19 per cent tax bracket ceiling will lift from $37,000 to $41,000.
About 1.8 million higher income earners will get a tax cut under stage three of the plan in 2024, which abolishes the 37 per cent tax bracket entirely and lifts the 32.5 per cent tax bracket to $200,000.
Mr Turnbull said the government would keep “plugging away in the Senate” to pass its company tax cuts.