Tim Storer won’t call for banks to be quarantined from company tax cuts

Tim Storer says unlike Pauline Hanson and Derryn Hinch he won’t call for banks to be quarantined from company tax cuts.

Storer said he is yet to be convinced the company tax cuts merited their price tag.

Crossbench senator Tim Storer says he sees company tax cuts and the banking royal commission as separate issues, and will not call for the banks to be quarantined from the Turnbull government’s enterprise tax plan.

Senator Storer’s comments come after crossbench colleagues including Pauline Hanson and Derryn Hinch called for the banks to miss out on the tax break, in what Financial Services Minister Kelly O’Dwyer dubbed a “morality tax”.

The South Australian senator, who entered parliament as an independent having resigned from the Nick Xenophon Team, said he was yet to be convinced that the economic gains provided by company tax cuts were sufficient to merit their $35.6 billion price tag.

“As I mentioned in my senatorial statement last month, with the bill in its current form, I saw it as a narrow change to the need for a broadbased tax and transfer system reform and therefore with the bill as is, I am still of the same mind,” Senator Storer told ABC radio.

“Certainly the government has continued to engage with me and I’ve been meeting with relevant economists and other stakeholders, so it’s an approach that I will take to legislation in the Senate chamber, which is to review the bill on its merits and based on what is put before me.

“There is some concern about the robustness of the ability to deliver budget surpluses over the course of the economic cycle, therefore if the bill retains its current form I’ll be very interested to see what the budget says with regard to that.”

The government’s enterprise tax plan would see companies with annual turnover exceeding $50 million given a five per cent tax cut, from 30 per cent to 25 per cent, over ten years.

Asked what he thought of Senator Hinch’s request for a ban on live exports in exchange for his support for company tax cuts, Senator Storer said he would not be adopting “that approach” to legislation.

“I’ve decided that what’s required of me and what the general public here in South Australia would like to see is that I review legislation in an evidence-based manner on its merits,” he said.

Senator Storer said he saw the issues of the banking royal commission and company tax cuts as separate.

“Obviously the royal commission has thrown up findings which are extremely disturbing and which the public are certainly not agreeable to this sort of behaviour in general, but I see these issues as distinct and separate,” he said.

“That royal commission has commenced, it will continue on. The company tax cut is relevant to all companies, and as such I won’t be seeking a carve-out of the banks as proposed by other senators.

“I’m not adopting that approach of reacting to those events because it’s not in line with the economic reading that I’ve been undertaking for the company tax cut, and this is not what was put before me in the Senate last time and obviously it’s the same situation now regardless of the royal commission.”

Senator Storer said he was persuaded by the argument that growth and jobs would flow from company tax cuts.

“But I found that the impact was modest relative to its costs,” he said.

“Last month I put forward that there may certainly be an argument for spending on other social and economic programs including infrastructure, which would deliver a response in GDP and jobs and wages far sooner and more quickly than the proposed enterprise tax reform plan as is.

“I put that to the government and I will await their response.

“The effect in jobs is lower than the effect in finality of the wages, but it does take time and it is a cost the impact of which was modest.”