Barnaby Joyce has accused the federal government of “not telling the truth” about its tax upheaval after a new survey saw business confidence drop to levels not seen since the start of the Covid pandemic. The latest Business NSW survey revealed confidence levels have sunk to -78, the lowest since March 2020, as fears grow over the impact of proposed tax reforms on small business owners.
Joyce Rejects Labor's Defence
Speaking on Sunrise on Monday, Joyce rejected Labor’s defence that small business owners had time to prepare before the changes came into effect. Joyce said the argument was like saying, “don’t worry about being on the trainline because the train is a little way off”. The former Nationals MP also accused the government of deliberately confusing Australians about the changes and warned the financial pressure facing households and businesses could rapidly worsen.
“Tanya (Plibersek) can’t explain it, and no one else can understand it... what I do understand is the pressures that are going to be coming onto people by Christmas could be the worst in the last two decades,” he said. “What, are we going to walk around with solicitors and accounts to try and decipher the Labor party budget?”
Plibersek Defends Reforms
Social Services Minister Tanya Plibersek defended the reforms, arguing many business owners were misunderstanding who would actually be impacted. “When it comes to capital gains tax, this only applies when you’re selling your business... what we’re doing is moving from a situation where the discount on capital gains tax is a flat 50 per cent to a discount that’s based on inflation, so there’s still a discount in there,” she said.
Plibersek said the government had invested $3.5 billion into small businesses and dismissed online criticism, instead saying Prime Minister Anthony Albanese had become a “silent business partner”. “There’s a lot of positive being ignored... the reason they want that attention is because they’re part of the group that are benefitting most from this. Eighty-seven per cent of the benefits from this go to the 10 per cent that are making the most money,” she said. “This is not going to have the impacts you’re talking about on your average plumbing business or your fish and chips shop, in fact, they might be better off under the new discounting arrangements.”
Productivity Commission Backs Changes
The debate comes as Productivity Commission chairwoman Danielle Wood publicly backed the capital gains changes, while warning the additional revenue must be redirected into income tax relief. “For the economic benefits to be realised, it’s important that the additional money collected from the changes to trusts, negative gearing and CGT is used to fund income tax reductions,” Wood told the Australian Financial Review.
Plibersek pointed to future tax cuts as evidence the government was already doing exactly that. “An average worker will get a $2,800 tax cut because of the changes we’re making,” she said. “People on wages and salaries who pay their tax every fortnight have been getting the raw end of the stick compared with people who are making profits on shares and other assets.”
Joyce Interrupts, Demands Truth
Joyce interrupted Plibersek, taking aim at the government. “Why don’t you just be straight, the answer is no, you’re not going to give it. It’s not going to cut it,” he said. “They have this bad habit of not telling the truth.” “Let’s practise the truth Tanya. We’ll practise it every morning.”
