A warning from the National Farmers’ Federation (NFF) that new Asian export markets are in jeopardy if Federal Parliament does not pass the Enterprise Tax Plan has been enthusiastically relayed by Assistant Minister to the Deputy Prime Minister, Luke Hartsuyker.
He said farmers were competing with “one hand tied behind their backs” because of Australia’s uncompetitive business tax rates.
The NFF and Business Council of Australia (BCA) have joined forces demanding parliament pass the Coalition government’s tax cuts, in full.
They estimate the move – drawn up for last year’s Federal Budget – would help draw $1 trillion investment into agribusinesses by 2050 to service the growing Asian market.
NFF chief executive officer, Tony Mahar, argued the new Trump administration had a tax cut plan to potentially lift investment in the US by 20 per cent or about $US524 billion, which would subsequently flow on to hit Australia’s export competitiveness.
“Australian agriculture has significant potential to supply the rapidly growing Asian markets on our doorstep, but the necessary increases in production and processing capability will require significant investment along the supply chain,” Mr Hartsuyker said.
“With intense global competition for investment in agribusiness, it is vital that Australia moves toward creating a more competitive atmosphere for business.”
He welcomed the strong farm sector support for the government’s Enterprise Tax Plan to be implemented in full.
NFF’s Mr Mahar noted President Trump wanted to cut US corporate rates from 35pc to 15pc, while Britain was moving to a 17pc rate by 2020
“There’s no disputing if world’s biggest economy more than halved its company tax rate it would dramatically reshape global capital flows and limit Australian workers,” he said.
The NFF boss and BCA’s chief executive, Jennifer Westacott, objected to suggestions by the Labor Opposition and the Greens, which oppose corporate tax cuts and only support small businesses getting any tax reduction.
“To limit tax relief to only small businesses would hurt our value-added export industries — think of cheesemakers and vegetable canneries — and ultimately narrow the door to premium markets for Australian farmers,” Mr Mahar and Ms Westacott said in a joint statement.
Mr Hartsuyker said Australia was a net exporter of food and fibre, with about two-thirds of total agricultural production sold offshore.
“These exports make Australia wealthier, providing jobs and supporting regional communities,” he said.
“The government is determined to deliver more competitive tax rates along the entire supply chain through our Enterprise Tax Plan.”
He agreed limiting company tax relief to small business would create “roadblocks for investment” at vital points in the integrated supply chain.