• Jenny Aitchison

Payroll Tax Rebate Scheme (Jobs Action Plan) Amendment (Extension) Bill 2015


My speech in opposition to the Payroll Tax Rebate Scheme because it does little or nothing to assist employers who are struggling to pay payroll tax and it does not create enough jobs to deal with rising unemployment.

I oppose the Payroll Tax Rebate Scheme (Jobs Action Plan) Amendment (Extension) Bill 2015. This bill does little or nothing to assist employers who are struggling to pay payroll tax and it does not create enough jobs to deal with rising unemployment. It is interesting to hear members opposite talk about being number one when it is clear that they are number one in only one respect—that is, creating unemployment. Unemployment has more than doubled in the Hunter since this Government came to office. The Government represents itself as the champion of small business, but this bill offers no help to small businesses. Members opposite might be former bankers, lawyers or employees of multinational corporations, but they have little empathy for, or experience of, small, bread-and-butter businesses. Those who heard my inaugural speech will know of my 17 years of experience growing a small business from a mum-and-pop shop to a company comprising three distinct small businesses employing more than 25 people. I have been an award-winning business owner. [Interruption] Mr Acting-Speaker, will you please stop these outrageous interjections? I am an undoubted supporter of small business. The problem is that payroll tax is a tax on jobs and businesses are required to pay it whether or not they make a profit. The threshold these days is low, and particularly when a business comprises three distinct entities, as mine did. Such companies or those engaging a number of professional staff rapidly hit the threshold. Small businesses are run by hardworking mums and dads. I know of many small business owners who during the global financial crisis reduced their own wages to subsistence level to retain jobs in their local community. They deserve a real hand and not the pretence that this Government is offering. The legacy of John Howard's goods and services tax is that our State Government does not get enough money from the Federal Government. It is no secret that that legacy means that neither State Liberal nor Labor governments are in a position to abolish payroll tax, which hits our small business sector particularly hard. Once a business reaches the threshold, payroll tax is payable on the whole payroll. Members opposite probably do not know that; they probably have not reached the threshold in their businesses. Have they ever run a business? The idea behind this bill is that a business will incur a payroll tax liability only when it employs more people. However, it will also apply when employers increase their employees' wages. If an employer increases the wages of 50 employees by $1,000, that will result in a $50,000 payroll increase that could put the business above the threshold for one year. Members opposite are now paying attention because they are hearing how the scheme will work. Once a business reaches the threshold, payroll tax must be paid on the entire payroll. In one year there may be no liability, but the next year it may be applicable to the entire payroll. The Labor Government's scheme helped small businesses with that transition over five years. That scheme was successful and it helped people. Mr Kevin Conolly: Did you use the scheme? Ms JENNY AITCHISON: This Government's scheme does not work; it is a failure. I will not debate the issue with the member for Riverstone. The Labor Government's scheme allowed businesses to transition slowly to full payment. They could report annually, and they worked with Trade and Investment NSW rather than being left on their own. This scheme is ridiculous. A business might employ someone in a new position and a year later the department must ensure that the new position has been retained. Growing businesses are not static for 12 months. A business owner might have employed more people or changed procedures. This legislation also offers no incentives for businesses to grant workers wage increases if the business is on or near the threshold. Payroll tax assistance is also cumbersome to claim. Last week a member of the Maitland business community asked the Parliamentary Secretary for the Hunter and Central Coast why the payroll tax details for a business that were prepared by an accountant had been audited over four months. Why was the proprietor dealing with payroll tax issues instead of focusing on the business for four months? Where is the benefit in that for a small business? Dynamic businesses change and go with the flow. If we are to have a scheme, it must be workable. People who have large and very profitable businesses have human resources departments that can process payroll tax liabilities easily, and they have volumes that make the business worthwhile. Small businesses are the engine rooms of this State's economy, and hardworking small business owners are being audited and are getting no help. If the Government is serious about using this mechanism, it should look at innovative schemes that reward those who expand their businesses into regional areas rather than impose blanket schemes that help only the big operators. Unemployment in the Hunter has doubled since this Government came to office. The Labor Government's scheme was abandoned and this Government is not helping employers to create jobs. Government members speak incessantly about the number of jobs the Government is creating and about being number one. However, it is number one only in creating regional unemployment. Members opposite are full of huff and bluster. The Government might create 500,000 jobs, but it means nothing unless we consider the rate of unemployment. We must examine participation rates. Good workers in our communities are abandoning the search for a job because nothing is being done to help them and there is no incentive for small businesses to employ them. This legislation is yet another example of this Government's failure to honour its promises. I was ejected from the House earlier today because I was behaving like members opposite and interjecting. I was interjecting because Ministers were gloating about the so-called benefits of the Government's privatisation plans and continuing to ignore their already broken promises about health and transport infrastructure. This bill represents yet more broken promises. Members opposite promised not to truncate the Newcastle rail line, to build a John Hunter-size tertiary hospital, and to retain the existing Maitland Hospital. All those promises have been resoundingly broken. For members opposite to make yet more empty promises about creating jobs simply hurts the unemployed even more. Their talk about having a mandate is offensive to the community. This Government does not understand the meaning of "mandate" or "commitment". It also does not understand small business. The Labor Opposition's commitments to retaining the Newcastle rail line, and building a new Maitland hospital and a Newcastle convention centre would have created many jobs. This Government has sat on its hands and offered a do-nothing scheme for four years, and the rate of unemployment in the Hunter has doubled. The Government tells us how successful it has been, but it should look at the failure of this scheme and its underutilisation. Small businesses have voted with their feet and ignored the scheme because it is useless. The Government therefore has no mandate to retain it. The Baird Government has made no commitment to reduce unemployment, particularly in rural and regional areas. It should implement a scheme that provides incentives to small businesses to create jobs. Instead, its answer is to sell the infrastructure; it wants to sell off the silver and leave the problem for future generations. This bill is yet another example of this Government's lazy, lazy, lazy approach to stimulating the economy, and it should not be passed.

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