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An Abbott Government Reform Agenda

29 May 2013

Significant micro-economic reform has been flagged in recent speeches/interviews by the next Australian Treasurer, Joe Hockey (assuming a change of government occurs in September 2013).  Small business is to be at the centre of an Abbott government’s economic approaches.


Joe Hockey at the National Press Club, 22 May 2013

[Full address here.]

Small Business

Treasury

“Tony Abbott has already announced that small business will be a cabinet portfolio within the Treasury department.”

Payments to small business
“Today I confirm that the Coalition will ensure that Commonwealth departments and agencies meet their obligations to small business suppliers by adopting a ‘pay on time or pay interest’ policy….- formal contracts or not….If an account is not paid within the 30 days, interest will be paid at the same rate as the Australian Taxation Office expects people to pay for late tax payments (currently 9.95%).”

ATO administration

Appointments
“But the relationship with the ATO does not have to be adversarial and should be based on mutual respect….appoint people with business experience to senior posts. The new Commissioner, Chris Jordan, is a breath of fresh air …
But for too long the tax office has developed an insular and inward looking culture that has put it at odds with taxpayers, particularly in relation to its overly aggressive interpretations of tax laws.
Taxpayers are not the enemy. They should be respected…. expand the number of Second Commissioners of Taxation, from three to seven, with appointments of “outsiders” …”.

Certainty
A second step is to reduce the complexity and increase the certainty of tax law…But when dealing with tax payers the ATO has everything in its favour….And when it comes to its legislated powers it all works in favour of the tax office as well.
For example if a taxpayer is assessed for tax, the only way the amount can be disputed is if the tax is paid in full (with few exceptions).

Parliamentary Oversight Committee
“I announce today that if elected a Coalition government will immediately establish a standing Parliamentary Committee with a singular focus – the oversight of tax administration.

Organisational structure
The second task will be an enquiry into the most effective organisational structure for independently handling and resolving formal taxation disputes.…I have deep reservations about the ATO being both an administrator and a prosecutor… the Coalition stands ready (if necessary) to break up the tax office, so that its policeman functions are separate to its responsibility for administering the tax system.”
 

Joe Hockey on Business Spectator KGB Interview, 17 May 2013

[Full interview here.]

Small Business into Treasury
JH: Tony Abbott announcing that we’re moving small business into the Treasury portfolio. And why are we doing that? Because I think a lot of regulation, particularly out of Treasury agencies like ASIC and the ACCC and some of the others, that has focused on, you know, designing regulation for big business, for the businesses that can get in the door in Canberra, for the businesses that have enormous legal departments and compliance departments and human resources departments and so on, whereas a small business in Australia doesn’t have all of that. And therefore the benchmark for regulation should be a small business and not a big business for the generic business regulation in Australia.

Fair Contract Laws
AK: I have a couple of questions from Bob Gottliebsen who can’t be with us today unfortunately. First question is to do with that. What’s your timetable for extending consumer protection type legislation to protect small business in their contracts with large businesses?

JH: Well, we’ve said in the first term we are going to have a review of the competition rules and part of the reason why we’re bringing small business into Treasury is to help with that review because we do want it to have a small business focus and the equality of opportunity for small business. So, that will be part of the more general review into the competition laws.   




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