Tax analysis ... the Treasury has found businesses will lose $4.57 billion in the first year of the Coalition's policy. Photo: Andrew Meares
THREE of the Coalition's tax policies will cost Australian businesses an extraordinary $4.57 billion in their first full year of operation, a Treasury analysis has found.
The Commonwealth Treasury analysis only examined those policies to which the Coalition has publicly committed.
Excluded are policies with a negative but uncertain impact on business, such as winding back the increase in the employee tax-free threshold from $6000 to $18,200.
The three policies identified by Treasury are the Coalition's commitment to impose a 1.5 per cent tax levy on big firms to fund paid parental leave, its decision to axe instant asset write-off and other tax breaks for small business funded from the price on carbon, and its decision to axe the ability for businesses to "carry back" losses and obtain refunds for tax already paid funded from the mining tax.
The analysis excludes the benefit to some businesses from axing the carbon and mining taxes.
Treasury finds businesses would lose $4.57 billion in the first full year the Coalition's three commitments were operational, accumulating to $17.2 billion over four years. Its calculations suggest manufacturers would pay an extra $1.34 billion a year, retailers an extra $930 million and the construction sector an extra $860 million a year.
Although business as a whole would benefit from the Coalition's policies because of the removal of the $6.6 billion a year carbon tax and the $2 billion a year mining tax, the analysis suggests that outside of the few big companies paying those taxes, the rest of Australian businesses would suffer.
Treasury's responsibility for costing opposition policies in the lead-up to election has been transferred to the new Parliamentary Budget Office, but it still maintains a watching brief on behalf of the government. During the 2010 election campaign it found errors and differences of opinion over Coalition costings amounting to $11 billion.
The Finance Minister, Penny Wong, told the ABC on Sunday the Coalition was being irresponsible by attacking government moves to keep the budget in surplus while not detailing how it would fund its own promises to axe the carbon and mining taxes.
"And I'm not sure it's responsible to talk about the ending of the age of entitlement but then oppose the tightening of benefits such as the Baby Bonus, and Family Tax Benefits," she added.
The Coalition finance spokesman, Andrew Robb, attacked Senator Wong for refusing to guarantee the budget would be in surplus.
"If Labor walks away from this commitment it would sit alongside Julia Gillard's infamous promise there would be no carbon tax," he said.
In budget analysis to be released on Monday, Deloitte Access Economics says sliding mining revenues make the forecast surplus unlikely. It expects a deficit of $4.2 billion this financial year, followed by a deficit of $5.1 billion in 2013-14.