Peter Costello

Media Transcripts

Doorstop Interview: Business Tax, Republic

Transcript No. 99/75

Transcript
of
THE HON PETER COSTELLO MP
Treasurer

Doorstop Interview
9.00 am
Wednesday, 13 October 1999

SUBJECT: Business Tax, Republic

JOURNALIST:

The meeting overnight with the Democrats, what was that to address?

TREASURER:

Well, the Government will be in a position shortly to put legislation into the Parliament to reform Australia’s business taxation system. And obviously we want to ensure that that’s enacted as soon as possible. We’ve had some discussions with the Australian Democrats to secure their support because the Labor Party, it appears, can’t make up its mind whether or not to support business tax reform. We had some good talks last night and I expect that those talks will continue. It’s an ongoing process. We had some discussions with the Democrats before the report of Mr Ralph was released. We had some discussions afterwards. We’ve now moved into the more business end of the discussions and I hope that they’ll lead to some productive outcomes.

JOURNALIST:

The Democrats obviously have some concerns though with regards to (inaudible). Were their concerns put aside last night, did you get to that?

TREASURER:

Well, this is a report which has been done by three of Australia’s leading businessmen after extensive consultation. And it’s a report to the Government which the Government has accepted. Now, I’m very happy to explain the basis of the Report, which is all there, there’s 800 pages of it. And I think the authors of the report stand by every line of it as well. And what I hope is that the Opposition and the Democrats see the sense of business tax reform. This is the once in a century opportunity to do business tax reform here. It’s not something that they should be playing politics on. We now have something like 1.8 million Telstra shareholders, and if the Labor Party had its way they would all face higher tax rates on their Telstra shares. We want to give the hard-pressed shareowner, the Aussie battler shareowner, tax relief. 77 per cent of capital gains tax in this country is paid by people earning under $50,000. And the Government has a proposal to give them some tax relief, we’re putting it into the Parliament. What we say to the opposition parties in the Parliament is, let’s do something for the nation, let’s pass tax reform.

JOURNALIST:

Did you discuss an inquiry though?

TREASURER:

Well I discussed all of the matters that have been raised by the Democrats. If they want an inquiry, I’ve asked them to let me know. Any inquiry should be short because what we need to do here is to legislate. The people of Australia want us to legislate to implement tax reform. The shareholders in Telstra want tax reform. The small businesses of Australia that are going to get cuts in their capital gains tax want tax reform. And the important thing is to get on and do it.

JOURNALIST:

Welfare groups say it could cost $1.5 billion though. Can we afford that when we’ve got the pressure from East Timor on the Budget?

TREASURER:

Well, capital gains changes don’t cost anything.

JOURNALIST:

That’s not what welfare groups say. They say it could cost $1.5 billion.

TREASURER:

Well, anybody can come up with any figure that they like . . .

JOURNALIST:

Including you?

TREASURER:

. . . but Mr Ralph, Mr John Ralph and his co-chairmen, who were tasked to inquire into this and have produced 800 pages of report. I think I’d rather rely on them. I haven’t seen the 800 page report from whomever you’re quoting now and I doubt that there is one.

JOURNALIST:

ACOSS.

TREASURER:

Well have they done an 800 page report? Has it been open for public scrutiny? Did they have 300 business submissions on it? I mean, it’s quite different isn’t it, when you have three leading Australian businessmen that inquire for 12 months, take hundreds of submissions, expert advice, put out a report – the Government is entitled to rely on it. In fact, Governments routinely do rely on inquiries that they set up. It’s very unusual for a Government to set up an inquiry to have an 800 page report and then say, none of it’s acceptable. Very unusual. I don’t think welfare groups or anyone else would urge that as good practice, would they?

JOURNALIST:

Mr Costello, Mr Beazley said this morning, that he’s dismissed your calls for it to be time to get on and legislate, saying that there is no legislation, we still haven’t seen it, is that the case?

TREASURER:

The legislation is being introduced into the Parliament next week. But you don’t need legislation to announce a policy. I mean, Mr Beazley routinely announces policies everyday before seeing legislation. Mr Beazley could announce his policy on GST without seeing legislation, couldn’t he? And he could announce his policy on income tax without seeing legislation. He announces policy on East Timor without seeing legislation. He announces policy on republics without seeing legislation. And no, that’s just a technique for him to avoid making a policy. Now Mr Beazley is a leader of a political party, he should try and make a policy. The fact that he can’t make up his mind, he just comes up with excuses as to why he can’t make up his mind.

JOURNALIST:

How serious is the time pressure now to get support for these capital gains measures?

TREASURER:

Oh look, we’ve got to get on. These measures started from the 30th of September. So what we’ve now got to do, is, we’ve got to get the legislation to enact the policy. It’s not like GST. It’s not like where you put the legislation and you wait a year. These are like normal tax announcements, they take effect from the date of announcement. So, I think we’re entitled to get on with them.

JOURNALIST:

The Senate Inquiry into the GST package led to, ultimately, to changes to that package. Is it conceivable that an inquiry into these arrangements could also lead to changes?

TREASURER:

Well, I’m not going to speculate on any outcomes except to say, I think that this is a positive report. This is a report that’s taken 12 months of inquiry already. It’s not as if you’ve got to start from scratch here, there’s already been a 12 month inquiry. And you think of Government reports that are done for the Government. It’s very unusual to have a Government inquiry and then an inquiry into an inquiry, very unusual.

JOURNALIST:

If the Democrats do want an inquiry, will the Government support it in the Senate?

TREASURER:

Well, if the Democrats can get the support of either the Labor Party or the Government, of course the Senate can call an inquiry.

JOURNALIST:

On another subject. Were you disappointed that one of your colleagues should use your words on the Republic to support a "No" vote in the referendum . . .

TREASURER:

Well look . . .

JOURNALIST:

. . . while you were overseas?

TREASURER:

. . . look, my comments in relation to the referendum speak for themselves. And when you read them they are an argument for a constitutional change. I’ve been very honest about this and I’ve looked at the pros and cons and come to my conclusion, that Australia should have a constitutional change. That the current arrangements are not going to serve us for the next century. Now, any fair reader of my comments would know that is the conclusion and cite the conclusion. Any fair reader would do that. And to sort of stop at the opening paragraphs before you get to the conclusion is not to fairly represent my comments, not to fairly represent them.

JOURNALIST:

So Senator Minchin was unfair?

TREASURER:

Well, I said, any fair reader that read my comments would read the totality of them, including the conclusion, which is that Australia should change its constitutional arrangements and set up an enduring constitutional arrangement for the next century. And that’s what my writings and my comments amount to.

JOURNALIST:

What do you think of the claim that under the model a President could be there for life as one of the "No" vote supporters are saying?

TREASURER:

No, I think under the model what happens is that a President is appointed with bipartisan support by both the Prime Minister and the Leader of the Opposition and serves a specified time. I think that’s quite clear in the model. Thanks.

13 Oct 1999

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