PRIVATE MEMBERS' BUSINESS

Mr GREGG (Deakin) (17:32): This motion really asks us to close our eyes, divorce ourselves from reality and just believe whatever tropes they continually repeat as if they're facts. This isn't a Dr Seuss story; this is serious public policy. When we talk about the impact on small business, it's worth reflecting on what the changes actually are.

A $20,000 instant asset write-off has been made permanent, which means that when you're buying important goods to run your business you get that write-off right away and not over a period of time. We have a permanent two-year loss carry back for companies with a turnover of up to $1 billion, helping businesses get back to profit during the tough times. We're introducing loss refundability—particularly important for start-ups in their first two years—which essentially means that the taxman isn't winning while new businesses are struggling to have the capital they need to continue and thrive.

This is very much focused on encouraging productive investment, supporting those small businesses that are doing the grunt work, trying something new and building it from scratch. We're also progressing a new innovative business CGT discount, providing that 50 per cent CGT discount to early-stage investors, founders, employee shareholders and the like who are involved in innovative startup businesses.

When you're listening to the coalition's rhetoric, you'd almost believe that people have never had it so good. 'The tax system is perfect just the way it is'—that is more divorced from reality than even they would normally be in this chamber. The housing system is broken. The CGT arrangements are a perverse distortion of markets and have operated to the detriment of young people for two generations.

It was time to make a change. We were not going to go out and look at the young people and say, 'You've never had it so good.' That was a lie; the system was not working for them. It wasn't working for the vast majority of Australians.

So who was the system working for? Almost no-one. The DEPUTY SPEAKER ( Ms Aldred ): Member for Forrest.

Mr Small: Deputy Speaker, we've had a lot of discussion about using that word in the parliament, and I'd ask the member to withdraw. Mr GREGG: I'm unaware of which term he's referring to, but, to assist the House, I will withdraw. The DEPUTY SPEAKER: Thank you, Member for Deakin.

Mr GREGG: These changes are very much focused on supporting the small businesses that are supporting growth and productivity in our economy. There is a raft of reforms there to support small business, rather than using alliteration or simply saying, 'Oh, it's too hard to discuss the details, so we'll just come up with a rhyming phrase.' No, this is serious policy work and it requires serious conversations and—heaven forbid!—good faith engagement on the details of policy.

Of course, my expectations have been tempered as I've continued to watch the coalition over the past year and a bit, but I think this is far too important to diminish into simple, childish slogans when there is actually a lot of really good stuff in this budget, and small businesses have made that very, very clear. Even those who don't agree with every aspect of the budget—and I accept that reasonable minds can differ—agree there is a lot of good stuff worthy of supporting in this budget, particularly for small business and particularly those startups that are creating jobs, trying new things and innovating.

That's where we know that our productive capacity is really going to get that value. We have not seen the tax system up to this point driving the kinds of productivity we as an economy need. We need to be rethinking the systems that have led to outcomes that we don't think are acceptable.

So trying to do things a different way makes eminent sense because, if you're not married to the outcome, why would you marry the formula? It makes no sense. The tax system is changing to incentivise productivity and to also reward hard work.

That's how the income tax changes are going to make a huge difference not only to employees but to the 1.5-plus million small businesses who make their income from the work that they do as well. The vast majority of small businesses are effectively workers; they're simply their own bosses. Most of their income comes from the income earned by the business and the wages they pay themselves.

It's that day-to-day grunt work and profit that gets them going. It's not the massive windfall they get at the end of the business cycle. In fact, a very large share of businesses don't really make a lot of capital at all at the end of their business life because the person is the business; it is the work, productive engagement and economic activity which really drives the value.

That's where the focus is. It's on productive gains and making sure that our economy is set up for future success by boosting productivity rather than focusing on rewarding passive ownership of existing housing, being a non-productive asset, and watching generations of Australians be excluded from the housing market. I believe in aspiration.

I believe that workers should be able to aspire to earn more and keep more of what they earn. I believe that families should be able to aspire to own a home to live in. Those are the things that this budget is focusing on.

And so, when we see motions like this that are really just rank partisanship and quite divorced from reality, let's start with a basis of fact. What is in the budget and what is being said? They were referring before to certain taxes they'd made up.

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