PARLIAMENT HOUSE, CANBERRA: I rise to speak on the Excise Amendment (Reducing Business Compliance Burden) Bill 2011 to express my support for its measures.
We on this side of the House understand two things in relation to small business. The first is that small business is indeed the backbone of our economy. It employs millions of people. There are tens of thousands of small businesses across this country and they create enormously valuable products that consumers enjoy. They provide the lifeblood for hundreds of thousands of families. In my electorate alone there are over 10,000 small businesses employing many more people than that.
The second thing we understand about small business is that red tape is the bane of them. We know that for small business people less red tape and less paperwork means higher profits, boosted sales and more time with families. We also know that red tape and extra paperwork stifles business activity, stifles entrepreneurship and stifles innovation. Indeed, in many cases it prevents new businesses from starting.
That is our starting point: one, that small business is the lifeblood of our economy and we should be supporting it, and, two, that red tape is the bane of small business and we therefore should be tyring to minimise it as much as possible. In this case, we give the bill before us a tick, because it does more to reduce red tape. The bill does this in a very modest way, as the member for Dunkley pointed out, but nevertheless it is an important way, because it reduces some red tape in relation to excise duties. It simplifies the reporting arrangements so that at the very least businesses that have to pay excise can report on a weekly basis beginning on the seven-day cycle that makes sense for them so that they can align their reporting cycle with other reporting mechanism they have to submit.
On top of that, it means that some small businesses can request to report on a monthly basis rather than on a weekly basis. So potentially this has the chance of reducing red tape by three-quarters, if they are reporting monthly rather than weekly. Again, it is a good, practical measure to support those small businesses which have to pay the excise duties. We commend the government for introducing this bill. It is a good bill and it will make a difference to those small businesses.
But, in relation to small business, that is where my commendation for the government unfortunately ends, because in many other areas it is not actually making things easier for small business but, rather, is making things more difficult. I will point out, first of all, some simple facts in relation to regulation. We should have collectively a goal to reduce red tape for small business, to reduce red tape and regulations overall. I was in part surprised at the government’s commitment—which at least was going along these lines—not to increase red tape. It made a commitment that, for every new regulation, it would remove one. That was its solemn promise to the people and to the small businesses of Australia: for every regulation it introduced, it would remove one. Okay, that does not reduce red tape overall, but at least it keeps it stationary.
But what has happened since Labor has been in government? It has not been one in for every one removed, not even two in for every one removed. Rather, in the time of this government, we have had 12,835 pieces of new red tape—new regulations—introduced, and how many have we had removed? Fifty-eight. So 12,835 in and 58 out. That translates to one out for every 220 in. To be fair, the member for Dunkley did just point out that the government has improved in this area. It is no longer one out for every 220 in; it is now one out for only 204 in. So it is a substantial improvement. Well done! But we still have a long way to go. Again, I commend the government for this bill. It is a good measure to remove red tape in this area, but there is still a long, long, long way to go for this government if it is really serious about reducing red tape.
I will point out some other measures which are making it tougher for small business. It is a climate, as you would realise, Mr Deputy Speaker, in which small businesses are doing it particularly tough. All of us on this side of the chamber would appreciate that just from speaking to the small businesses in our own electorates. Retailers are doing it particularly tough. There is barely a single retailer who is doing well at present. Manufacturing, as we know from reading the papers on a daily basis, is laying off jobs. The construction industry is slowing down. There are shops which are now not open which had been open for many, many years. We are only too aware of the difficulties which small businesses are facing. In that climate, the last thing that we should be doing is adding additional obstacles for small business. But, when you go through some of the measures which the government has put in place, even over the last 12 months, you see that they only make the job of small businesses tougher. I will point out a few of those things.
We have talked at length about some of the employment laws which have been introduced in the Fair Work Act in this place. Go-away money for small businesses has returned, as many people are telling us. Union access has again increased dramatically, above and beyond what would ordinarily be considered reasonable. We hear of circumstances where schoolkids who want to work for a couple of hours after school in the local small business have been prevented from doing so by laws which have been introduced which prevent that reasonable thing from happening.
We can look at some of the tax measures that the government has introduced. I note particularly the entrepreneurs tax offset, which has been abolished as part of the mining tax package. It was just slipped in very quietly in the mining tax package—no fanfare—but it affects tens of thousands of people across this country. Small contractors who are earning less than $75,000 a year will now pay up to $800 more tax because of the abolition of the entrepreneurs tax offset.
We see the additional pressure on interest rates which this government is putting onto small business because of the enormous budget deficits which the government is running. As the Leader of the Opposition pointed out just after question time today, the government has clocked up the four largest budget deficits in Australia’s political history in the last four years alone.
The granddaddy of them all is the carbon tax, which unfortunately is due for implementation come 1 July this year. In the context of everything else which is going on in small business, the carbon tax is going to hit them particularly hard, because there is barely a small business which does not use electricity as one of the large inputs to its business. We know, from the government’s own figures, that electricity prices will increase by 10 per cent in the first year alone, although the electricity sector says it is likely to be 20 per cent. That is on top of the ordinary electricity increases. That is just the starting point, when the tax starts at $23 per tonne. Again on the government’s own figures, that tax is forecast to increase to $29 within a few years and then to just keep going up and up and up and up. Of course, those costs then flow on to every single other product which consumers have.
Let me summarise by reiterating my support for this bill. I commend the government for introducing it. It is one of the few measures which the government has introduced which do the right thing by small business and reduce the regulatory burden for them. But I ask the government to go further than this and to look at some of the measures which the coalition has put forward and which the member for Dunkley outlined earlier. Look at those, examine them and feel free to adopt them, because they are good measures and they would reduce the regulatory compliance burden for small business, they would reduce tax for small business and they would enable small businesses to grow and flourish.