On August 29 2012 Joe Hockey addressed the Committee for Economic Development of Australia (CEDA). During his speech he said
“business would be right to feel misled by the government’s false starts and policy backflips on cutting the company tax rate. The Minister for Finance had committed to delivering the promised 1% small business and company tax rate cut on over 45 separate occasions, going so far as saying that “We can guarantee we’ll support this”. In turn the Treasurer had committed to delivering the small business and company tax rate cut on over 70 separate occasions, describing this policy as ‘critical’. This promise was dumped in this year’s Budget. It is understandable that many in the Australian business community are unimpressed.”
Mr Hockey promised
“The Coalition will cut through the uncertainty and backflips on tax. We make clear and certain promises.”
So imagine my surprise to learn that the Federal Government has formally revealed it will not go ahead with its promised company tax cut for big businesses.
In the same speech, Hockey criticised the carbon and mining taxes saying they “introduced very significant business risk in Australia.”
In September 2014, Tony Abbott said the mining tax had dragged down the Australian economy and the mining sector for too long.
“We have seen the back of the mining tax – possibly the most foolish tax in the history of our country – a tax that destroyed jobs, a tax that damaged investment, a tax which cost money and a tax which did not raise any revenue,” he said.
Association of Mining and Exploration Companies chief executive Simon Bennison said the abolition of the tax would produce tangible economic benefits.
“This will improve investor confidence and create more jobs for Australians,” he said.
The Office of the Chief Economist just released the March “Resources and Energy Quarterly” report. It tells a different story of declining investment and job losses.
“While housing construction expenditure has increased recently, it has not been large enough to offset the decline in mining investment.
Despite initiatives to streamline approval processes and award major project facilitation status, there are fewer projects entering the investment pipeline. Mining industry capital expenditure was down 15 per cent on the December quarter 2013.
Given the projected softness in commodity prices over the medium term, the outlook for further investment in the mining sector is subdued. As high-value LNG projects are completed over the next few years, the stock of capital investment will be substantially drawndown. The downturn in investment has come from a very high point.
Mining sector employment was 228 900 people in the December quarter 2014, down 6 per cent compared with the September quarter, and 16 per cent lower than the December quarter 2013. As part of cost cutting and productivity enhancing initiatives, many producers have sought to reduce staff numbers through job cuts or insourcing some functions that were previously undertaken by contractors.”
So according to our own Department of Industry and Science, investment was at a high when we had the carbon and mining taxes and, since their repeal and the deregulation of environmental safeguards, investment has declined and employment has dropped.
Falling commodity prices have been blamed but these are in part due to a deliberate oversupply in a time of falling demand. Many developments are also moving from the investment phase to the production phase.
Emissions of toxic pollution by EnergyAustralia and Origin Energy have increased by more than 500% in the past financial year, and AGL has become the country’s biggest carbon polluter, a new study claims.
Together the trio account for 13% of Australia’s total carbon emissions, according to the report by the activist group GetUp.
Investment in large-scale renewable energy in Australia has plummeted by 90 per cent in the last 12 months and lenders are leaving the market, according to analysis from Bloomberg New Energy Finance (BNEF).
The report shows only one large-scale renewable energy project has been financed this year for $6.6 million, following zero investment in the last quarter of 2014.
Since the Federal Government announced its review of the Renewable Energy Target in February 2014, $206.9 million has been invested in the sector. In the 12 months prior to the announcement of the RET review, investment was around $US1.9 billion.
“The Australian large-scale clean energy industry has become practically uninvestable [sic] due to ongoing uncertainty caused by the government’s review of the Renewable Energy Target,” the report reads. “[This year] also saw Banco Santander, the world’s third largest clean energy lender, exit the Australian market.”
Yesterday the Australian Bureau of Statistics revealed the renewable energy sector had lost 2,300 jobs in the last two years.
So the Coalition have reneged on their promise to cut company tax, removed the carbon tax causing an increase in pollution and a loss of billions in revenue, repealed the mining tax and reviewed the RET which has been followed by a large decrease in investment and a loss of thousands of jobs.
Listening to Tony Abbott addressing the Australian Chamber of Commerce and Industry this afternoon, he ruled out any change to taxation on superannuation during this term. There is also some suggestion that he might bring back the small business $6,500 instant asset write-off that they retrospectively got rid of with the mining tax (backdated to January 1, 2014) despite Joe Hockey saying in that speech from 2012 “we will continue to oppose retrospective tax legislation which disadvantages taxpayers.”
Tony Abbott once spoke of a trust deficit with respect to the Gillard government.
You hypocrite, first take the plank out of your own eye, and then you will see clearly to remove the speck from your brother’s eye.
Not only is there a trust deficit with the Abbott government, one must question their motivation and doubt their competency. They seem incapable of telling the truth or adapting to changing circumstances.
They have a mission and come unemployment, poverty, recession, or global destruction, they are determined to follow their course.
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