Thursday, June 28, 2018

Today by Paddy Manning

He’ll be back
The zombie company tax debate


You can’t kill it! The zombie debate that’s been grinding on for more than two years will be back on in spring after the finance minister, Mathias Cormann, shelved [$] legislation to cut big business taxes. At the beginning of the week, the tax cuts were framed as his “greatest test”, but Cormann will be glad he failed. Energy wars and urgent national security crises aside, the government ends the week in the happy place with the unpopular tax cuts off the agenda for the crucial Super Saturday by-elections, and Opposition Leader Bill Shorten damaged but not replaced. Cormann might silently thank One Nation’s Pauline Hanson for her ridiculous flip-flopping on company tax. He gets to walk away with his dignity intact, and at this morning’s press conference Cormann mouthed the necessary platitudes: “we need more time”, “despite our best efforts”, and “we remain fully committed”. It is so convenient, Labor suspects a secret deal has been done, and peppered [$] the government with questions this afternoon, to no avail. The #cormannator will be back, but now the focus is on Labor, because while cutting taxes for big business is not popular, nor is raising tax on small business.

Labor has succeeded in portraying the last tranche of the government’s company tax plan, to lower the tax rate for businesses with annual turnover above $50 million to 25 per cent, as a handout for the top end of town, especially the banks. After Bill Shorten’s surprise press conference on Wednesday, in which he confirmed that Labor would repeal the already-legislated tax cuts for businesses with a turnover between $10 million and 50 million, the government has turned the company tax debate on its head. In Question Time this afternoon the PM rattled off the names of the many businesses – especially “family businesses” – which now faced a higher tax under Labor, and asked whether Shorten was “seriously suggesting” that a company turning over between $10 million and 50 million represented the top end of town? “It’s like calling somebody on $90,000 a year a multimillionaire,” railed Turnbull. “They are so out of touch with what makes Australia work.”

As Deloitte’s Chris Richardson said this morning, annual turnover is an odd way to rank businesses for tax purposes, given that tax is paid on profit, and there are plenty of low-margin businesses (in construction, for example) that have a high turnover but small profits. That aside, it’s pretty clear that the smaller the business, the more public support there is for tax relief. If big business tax cuts are electoral poison – which the government is happy to shove off the agenda until after the by-elections – the small business tax cuts definitely are not.

Suddenly Labor seems all at sea. Unsurprisingly, Shorten’s “captain’s call” is seen through the prism of leadership, after shadow infrastructure minister Anthony Albanese’s Whitlam Oration last Friday, which was interpreted not just as an unhelpful look-at-me pitch, but as a bid to walk Labor’s message to the electorate back away from class warfare. Yesterday it was Ross Hart struggling to defend Shorten, today it was Gai Brodtmann [$] and Tanya Plibersek.

Over on Sky News, the very pro-business former Labor powerbroker Graham Richardson called last night for Shorten to simply backflip. Andrew Bolt of all people jumped to Shorten’s defence (in a manner of speaking). Instead of a captain’s call, Bolt suggested that Shorten made a simple mistake – what he called a “word vomit” – but one that was hardly significant, because it most likely would have been Labor’s policy anyway. It was no fluke that Shorten had led Labor to beat the Coalition for the last 21 months in Newspoll, Bolt said, and closed: “I wouldn’t be writing him off just yet.”

The conservatives’ worst nightmare, after all, would be a sudden leadership switch to the popular Albanese.

since this morning

Canberra lawyer Bernard Collaery and a former spy who exposed a secret Australian operation in East Timor have been charged with breaching the Intelligence Services Act. Crikey’s Bernard Keane writes [$] that the “extraordinary prosecution [is] likely to have massive ramifications for free speech in Australia”.

The Senate will debate a repeal of the euthanasia ban in Australian territories in August, when David Leyonhjelm will introduce a bill backed by Labor, Greens and four crossbenchers.

in case you missed it

Barriers to the rapid deployment of special forces troops, military hardware and defence experts to deal with domestic terror threats will be removed [$] under changes introduced into parliament today.

In a letter to the Australian Border Force, published in The Guardian, the mother of a refugee who killed himself on Nauru has pleaded for the release of her son’s body so that she can bury him “anywhere except Nauru and Iran”.

The Coalition last night voted for a Pauline Hanson motion to subsidise new coal-fired power stations. Meanwhile, Sydney’s lord mayor, Clover Moore, has launched the city’s first industrial-sized battery and solar installation.

by Linda Jaivin
The new era
Ready or not, China is here

by Steve Dow
The mesmerising ‘Dark Emu’
Bangarra’s latest production explores Aboriginal Australians’ sophisticated farming practices

Paddy Manning

Paddy Manning is a contributing editor (politics) at The Monthly. He is a writer and journalist who has worked for the ABC, Fairfax, Crikey and The Australian. He is also the author of three books, including Boganaire: The rise and fall of Nathan Tinkler.

The Monthly Today logo

In-depth analysis of the moments that define the day from Paddy Manning.
Free to your inbox every afternoon.


The Monthly Today

No time for L-plates

Scott Morrison has taken the reins at a tense moment for Australia

Pub test: the republic

First things first, say punters in Matt Thistlethwaite’s electorate

ScoMo-tion demise

The accidental PM appears accident prone

Taylor faces energy backlash

Public money for “fair dinkum” power could haunt the new minister

From the front page

Image of Polly Borland’s ‘Untitled (Nick Cave in a blue wig)’

Polly Borland’s x-ray vision

The Australian artist in conversation about ‘Polyverse’ at the NGV, Nick Cave and dress-ups


Life in a coroners court

Meet those who speak for the dead to protect the living

No time for L-plates

Scott Morrison has taken the reins at a tense moment for Australia

Image of Scott Morrison and Mike Pence at APEC 2018

Cooperation takes a back seat at APEC

As tensions between the US and China rise, it’s getting harder for Australia not to take sides