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Swan still open to business tax cut

Treasurer Wayne Swan during question time at Parliament House.

Treasurer Wayne Swan during question time at Parliament House. Photo: Andrew Meares

Treasurer Wayne Swan has left the door open to a corporate tax cut despite abandoning the government’s promised one per cent cut for business in the federal budget.

In his fifth post-budget address to the National Press Club, Mr Swan said the government had been unable to secure passage for its tax cut legislation through parliament because the coalition had vowed to block the tax cuts as they were linked to the mining tax, which the Opposition has promised to repeal.

The Greens also opposed the big business tax cut.

The Treasurer indicated he had not given up on tax relief for business, saying that a business tax working group was now looking at ways to fund it.

He said that representatives of the working group were a way from reaching a consensus. ''(They) want to have a longer and more informed discussion about these matters,'' he said.

This had made the decision to redirect the $4.8 billion of funding from the mining tax to families and low and middle income earners. Mr Swan reflected on the budget decision making process and said it had been difficult to implement cuts right across the scope of government programs and departments.

''The worst part of being Treasurer is watching the bottom fall out of revenue then having minister after minister traipse into the room and have the ERC (economic review committee) shave their plans back or tell them no,'' he said.

''But the commitment we made at the depths of the crisis in 2009 to get back to surplus is one of the best policies we’ve put in place.  It’s a powerful signal of credibility to nervous markets.  More than that, it puts a marker in the ground in cynical times, and says there is a proper, reliable basis to our economic policies.''

Mr Swan said the Australian economy walked ‘‘tall in the global economy’’ and that the nation was ''on the cusp of something great'' due to its geographical and economic circumstances.

''Australia doesn’t need to be just a passenger in the Asian Century.  With the right decisions, we can make this the Australian Century as well,'' he said.

Mr Swan admitted the government had paid a heavy political price for implementing the carbon price but stopped short of linking the cash handouts to families in the budget to the unpopular policy.
Rather, he said the family payments top-up reflected his long-held commitment to supporting the middle class.

Mr Swan laid down a challenge to the coalition to pass his budget in full but said he wasn’t optimistic his plea would be well received.

''We want more people with a stake; our opponents want the benefits of this extraordinary time in our history to flow to the Clive Palmers of this country,''he said.  

‘‘Some will call that a Robin Hood budget, but I just call it a fair go budget.  A fair go because it recognises those millions of Australians on low and middle-incomes who feel like this is somebody else’s boom.’’

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