Coalition's tax cuts could win final two votes from former NXT senators
Rex Patrick has signalled that the two Centre Alliance senators are open to persuasion on the government’s company tax plan, undertaking further “due diligence” despite their party’s initial opposition.
While negotiations in March focused on senators Derryn Hinch and Tim Storer to provide the final two votes, the Coalition is turning its attention to Patrick and Stirling Griff, who indicated on Wednesday that guarantees on electricity prices, government revenue and service provision could help win support.
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Patrick told Guardian Australia
the party – formerly the Nick Xeno-
phon Team – had not changed its position but the “starting point” in the last sitting of parliament had been to oppose the tax cuts because it “had no time to deal with any issues of due diligence”.
“This pause has allowed us to go off and say, ‘It’s a serious piece of legislation we should look at it’ – that doesn’t mean we’re going to say yes,” he said.
Patrick said he was meeting economists and government officials to learn about “both the pros and cons” of the Coalition’s proposed second tranche of tax cuts for companies earning more than $50m a year, which will cost $35bn over its 10-year life.
“I have to present those to the party … I’m not forming a position on behalf of party, I’m gathering the pros and cons and what are the potential remedies to those.”
Patrick noted that many business were concerned about power prices and a company tax cut “doesn’t necessarily help them if they’re not making a profit”.
“The government is saying we need [company tax cuts] to attract investment – I understand that,” he said. “At the same time, what about the companies that are looking to shut down? How do we address their concerns?”
Patrick said he had discussed power prices and the “longer-term outcomes” of the Coalition’s proposed national energy guarantee with the chief scientist, Alan Finkel, and the Energy Security Board chairwoman, Kerry Schott.
The Centre Alliance wanted “assurances” gross national income would grow and that, if it didn’t, services would not be cut.
He said the party was not in formal negotiations with the government but he was in contact with the finance minister, Mathias Cormann, who “could suggest some remedies” to its concerns.
Hinch was believed to be close to agreeing to the company tax cuts but in April hardened his position by renewing his call for the big four banks to be excluded after damaging revelations in the banking royal commission.
On Tuesday Storer said he was still not intending to vote for the company tax cut because it was a “narrow change” rather than part of a broader tax reform and he was concerned about the government’s ability to return the budget to surplus.
The Senate is examining the package through a committee inquiry into the Business Council of Australia’s non-binding commitment that its members would increase investment if the company tax cut were passed.
In its evidence on Tuesday, the BCA took aim at Storer’s position, with its president, Grant King, arguing “the absence of a broad tax reform agenda should not be a reason to delay any tax reform”.
One Nation has supported the package, despite initially opposing it. The party’s leader, Pauline Hanson, conceded on Tuesday that it might not increase wages.
She qualified the party’s support by suggesting some portion of the tax cuts should be quarantined to ensure that banks paid compensation to wronged customers.
The Senate inquiry will resume on Thursday with evidence from the Australian Council of Trade Unions, BHP and Fortescue Metals, Energy Australia and further evidence from the BCA.