Company tax
Tax breaks to speed up major projects is old news, says Labor
Shadow Treasurer Jim Chalmers said the Treasurer and Prime Minister Scott Morrison did not have a plan to manage the economy.
Tom McIlroyPolitical reporter
Nov 14, 2019 – 9.15am
Shadow treasurer Jim Chalmers is sceptical of Morrison government moves to change tax incentives for major infrastructure projects, calling the latest announcement from Josh Frydenberg old news.
Shadow treasurer Jim Chalmers said the announcement was old news. Alex Ellinghausen
Treasury on Thursday released a discussion paper on a plan to set a 15 per cent concessional rate for nationally significant infrastructure, including energy, transport, communications and water projects worth more than $500 million.
Despite being billed as new action from the government, coming during sluggish economic growth, the 2018-19 budget papers included a $360 million measure to address risks to the corporate tax base from stapled structures.
That measure included a 15-year exemption for new, government-approved nationally significant infrastructure staples.
Mr Chalmers said the Coalition was "recycling old policy to distract from the fact the economy's floundering".
He said the Treasurer and Prime Minister Scott Morrison did not have a plan to manage the economy.
"Pretending old policies are a response to the slowing economy is not a plan it's a con.
"The economy's deteriorated since the election and the Treasurer doesn't have a clue what to do about it so he bowls up old policies and pretends they're new.
"Australia has the slowest growth in a decade and the worst business investment since the early 1990s, but the best that Frydenberg can do is produce a discussion paper about an old policy."
Mr Frydenberg defended the government's economic management in a speech in Adelaide on Thursday, arguing against using the projected budget surplus to add fire to the economy, as recommended by the Reserve Bank.
Labor will consider the detail of the proposal before forming a position in parliament.
"A discussion paper won't turn this floundering economy around or fix Australia's investment problem which is broader and deeper than what's being addressed here," Mr Chalmers said.
The 2018-19 budget measure was estimated to have a gain to government revenue worth $400 million over the forward estimates, with the package designed to protect the revenue base going forward.
Mr Frydenberg urged state and territory governments to boost productivity.
"If we were to respond to every call from every corner for increased spending we would not be in a position to pay down the debt we inherited, to have the flexibility to respond to future shocks and to provide the stability and certainty that households and businesses need to continue to consume and invest," Mr Frydenberg said.
In an interview with Sky on Thursday, Mr Frydenberg described the government's $158 billion personal income tax cuts as "making their way through the economy".
Asked if the cuts, passed by Parliament in the wake of the May election, had produced a stimulatory impact, Mr Frydenberg said they had had "an impact".
Tom McIlroy reports from the federal press gallery at Parliament House. Connect with Tom on Twitter. Email Tom at thomas.mcilroy@afr.com
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