HENSCHKE: Penny Wong, what would you like to say in response to Peter Vaughan?
WONG: Well, quite a number of things. First, I assume that Peter will be supporting the Governments policy to reduce taxation for small business funding by the mining tax, because thats one of the key planks of the minerals resources tax, is to actually reduce taxation for small business to be funded out of the minerals tax.
But weve got to take a step back and perhaps understand the economics of pricing carbon, and what the Government put out, to understand what the Government is doing. We want to put a price on carbon to reduce pollution, because we know it is contributing to climate change. That price does two things, it gives a signal to polluters to reduce their pollution, and a signal to investors about where to invest, so we get more investment in clean technology.
HENSCHKE: But Penny Wong, just look, very quickly, weve had a text come in from a person that says look, Im an owner-driver, I have to put up my costs $15,000 a year, Im sure my customers wont want to pay that. Were already getting the switchboard lighting up, so small business is worried. What can you say to them?
WONG: I understand that, and what I was going to go on to say, that price, for some businesses, they wont be able to pass it on because they trade in world markets. And those are the businesses that we are giving a substantial amount of assistance to, because they cant pass the price on.
Some businesses, though, who work in the domestic market, who trade in the domestic market, can pass on the price. And there will be price increases, and thats why we have said well provide very substantial assistance through tax cuts, and to increases in payments to consumers to deal with those price impacts.
Bear in mind that the price impact were talking about is about 0.7 per cent on the CPI, on the Consumer Price Index. So across the economy, what Treasury is saying, is the price impact is about, is less than one cent in every dollar. The GST price impact was about two and a half percent. So if we can just keep things in perspective about the sort of price impact were talking about.
The other point I make in terms of assisting consumers to deal with the price impacts that will be passed on by some small businesses, including possibly owner-drivers, is that we are giving a tax cut to every Australian earning up to $80,000 a year, and no Australian will pay more income tax under the plan the Prime Minister announced.
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HENSCHKE: Penny Wong is back on the line, just very quickly before we go to Canberra, Penny Wong to answer those points?
WONG: Two very quick points. The listener who rang up and spoke about energy efficiency work. We are providing grants of some $40 million to enable business organisations to work with small business to identify energy efficiency opportunities that helps people reduce their costs.
The second thing is we are providing a tax break to small business, an instant asset write-off of up to $6500 in a year, because we understand that they will want to make investments to try and reduce their energy use, to reduce their costs.
HENSCHKE: Thanks for your time this morning.
WONG: Good to speak with you.
ENDS