Appropriation Bill (No. 1) 2026-2027
Mr VIOLI (Casey) (10:42): My first question is a pretty straightforward question for the Minister for Industry and Innovation: why have you not engaged with industry about the budget changes, particularly the changes to capital gains tax and trusts? The second question is another very simple one for this minister: Why are you not talking to the Assistant Minister for Science, Technology and the Digital Economy at all about the tax changes?
Why is the assistant minister running roundtables that you have no idea about, as the minister confirmed in Senate estimates? Why is the assistant minister running roundtables without the department there to take notes? Why has the Department of Industry, Science and Resources not engaged with any stakeholders or been to any roundtables since the announcement of these disastrous budget tax changes that blindsided industry?
The reality is there is a cold war going on within the Labor Party at the moment, and it's been shown by the member for Parramatta, the member for Bennelong and the member for Chifley speaking out publicly. It's not surprising that the minister, who sits in the left faction, and the assistant minister, who sits in the right faction, are not talking, because there's a little bit underway there, a bit of pressure.
You know that there's real pressure opposite when the Prime Minister starts talking about 'unity' and 'order in the caucus' to break their word to the community. The Prime Minister protests a little bit too much. The sad part about this division and the sad part about having a prime minister that's never worked a day in the private sector, a Treasurer that's never worked a day in the private sector and a finance minister that's never worked a day in the private sector—and they refuse to consult with industry—is that it results in policies that are damaging small businesses, damaging tech start-ups and damaging those who create innovation and solve the challenges that the Australian people face.
The tech sector want to get ahead and want to solve challenges that we face as a nation, and they're being kneecapped by this government. It's either ideology or ignorance that is leading to it, but the reality is it's both because they don't understand industry. The worst part about these changes, in addition to breaking faith with the Australian people and the Prime Minister destroying any legacy he might have had, is that these changes will punish start ups and small businesses and will provide an incentive to investors to invest in large organisations that are already established.
Let's say you have $20,000 that you want to invest. If you invest that into a start up who delivers a return on capital increases—they start at zero and build a business, and part of the plan is an exit strategy to sell that business—that means that your capital will go up significantly and you will now be taxed at 47 per cent under this government. So why would you want to put that $20,000 into that business where your exit strategy will be taxed at 47 per cent?
The better use of that $20,000 is to put it into the share market, into companies like Woolworths or Coles or the big four banks, big established businesses that are not relying on their value through asset growth. They are providing dividends back to you every quarter or every six months or every year. You want that revenue coming back to you through a dividend, and, if you manage your numbers right, you won't be taxed at that higher rate.
That is the perverse impact of these capital gains tax changes by this government. It will drive less innovation. It will support fewer Australian businesses.
It will hurt science. It will hurt technology. It will hurt those that want to get ahead, and it will encourage people to give more money to the big four banks, to Woolworths, to Coles, to those successful businesses.
Well done to those successful businesses. They're not the ones that need government help, but they are getting it from this government because this government, as we have seen through the minister for industry, the Prime Minister and the Treasurer, does not understand the challenges that people face. They do not understand industry, and in the long-term, our country will suffer.
Products like cochlear and so many other ideas that have been generated in Australia will have less capital, and without capital these ideas cannot go from an idea in a factory or a laboratory into the mainstream and actually commercialise and solve those problems.