15 August 2013
Australian Broadcasting Corporation (ABC) News
Prime Minister Kevin Rudd has announced an “objective” to cut company tax in the NT as part of a jobs and growth plan.
Prime Minister Kevin Rudd says he wants to give businesses in the Northern Territory a “leg up” by cutting company tax rates in the state by as much as a third.
But Opposition Leader Tony Abbott, who has previously promised to review tax incentives in the north, has dismissed Labor’s policy as “catch-up politics”.
Mr Rudd has made his first visit to the NT this election campaign, targeting concerns about unemployment and infrastructure in the region and declaring “I love the Territory”.
He has announced a “three pillar” economic strategy, hinging on an “objective” to cut the company tax rate for businesses there by up to one third – but not until 2018.
“I love the Territory,” Mr Rudd said, explaining he thinks Northern Australia is “huge in terms of its economic potential”.
“My personal objective for the Territory given its unique remoteness is for it to have a company tax rate one third lower than that of the rest of the country,” he said.
“All we’re talking about is giving people a bit of a leg up and I think most Australians when they come to Darwin say ‘that’s a fair thing’.”
The company tax rate is currently 30 per cent and, under Labor’s plan, could be reduced to 20 per cent.
Mr Rudd has not released any costings for the proposal, arguing that will have to wait for more detailed talks with the NT Government.
He said, a final plan – including costs – would be announced next year if Labor was re-elected.
The Constitution prohibits different tax rates between the states, but Mr Rudd has pointed out there are no restrictions regarding the territories.
Abbott says Rudd playing ‘catch-up politics’ The Opposition released its “2030 Vision for Developing Northern Australia” in June.
It has promised a White Paper on the region in the first 12 months of a Coalition government, which could review personal and business tax incentives.
Mr Abbott says his opponent has “finally woken up” to the region’s potential.
“Mr Rudd is playing catch-up politics but nevertheless it’s good to see he’s finally interested,” he said.
He has described the tax cut proposal as “entirely uncosted” and “just another thought-bubble” but says the Coalition will look at it “carefully”.
“We’ll have a look at it and see if there’s anything useful here,” he said.
“But when our comprehensive Northern Australia paper was released earlier, the Government was out there pillorying our proposal for the consideration of things like zonal tax rebates and so on.
“All I can say is, Mr Rudd has entirely changed his tune.” MP previously criticised Coalition’s plans to cut taxes in region When the Coalition policy was announced, Labor frontbencher David Bradbury described it as a “proposal to divide Australia in two” and warned it would mean higher taxes for people in his electorate in western Sydney.
“You’re going to have gold-plated footpaths in Karratha while people are stuck in traffic gridlock in places in Sydney,” Mr Bradbury said in February.
Mr Rudd has also pledged an extra $10 million to the NT Government to help expand the Ord River Irrigation Scheme, and to develop 20-year growth plans for key regional centres across the north.
“What we need is the national imagination to harness the enormous agricultural potential of Northern Australia to build the new food export industries to turbo-charge our economy in the future,” he said.
“We will harness the bountiful supply of water available here in the north to drive the production of these new food industries for export and create new jobs.” Mr Rudd made the announcement of Labor’s policy in the marginal electorate of Solomon, held by the Country Liberal party by just 1.8 per cent.
Courtesy of Australian Broadcasting Corporation