Treasurer rules out corporate tax reform as money dries

Treasurer Jim Chalmers says the government is making meaningful changes to the nation's tax base.

Treasurer Jim Chalmers says the government is making meaningful changes to the nation's tax base. Photo: AAP

Treasurer Jim Chalmers says company tax reform isn’t on the government’s agenda as calls grow for bold changes to deal with Australia’s struggling budget.

This year’s intergenerational report is being released on Thursday and will reveal economic growth will be sluggish over the next four decades compared to previous ones.

But the critical mineral sector is expected to expand as the world moves to net zero emissions by the middle of the century.

Global demand is predicted to increase 350 per cent by 2040, positioning Australia to take advantage of the booming industry with its vast reserves of lithium, nickel, zinc and bauxite.

Australia’s exports of critical mineral are forecast to double over the next five years but the treasurer is facing calls to be more ambitious with tax reform.

Dr Chalmers said the government was making meaningful changes to the tax base despite labelling the changes as “modest” as it pushed to boost revenue from offshore gas and claw back money from large superannuation balances.

“They are helping us to get the budget in a much better nick,” he told the ABC’s 7.30 program.

“They will save us in interest repayments over the course of the intergenerational report period, they will … rebuild our buffers against this global economic uncertainty.”

Superannuation is also set to shield the budget from an ageing population with the $3.5 trillion asset pool meaning fewer Australians will be on the pension.

But the government is also bracing for increased spending across health, defence and interest repayments.

“You need to look right across the tax system and your tax base needs to be robust enough to fund the kinds of services that people rely on, particularly as our population lives longer and healthier lives,” Dr Chalmers said.

But he ruled out changes to the headline corporate tax rate despite the make-up of Australia’s tax revenue into the future changing as money from cigarettes and fuel excises dry up.

Shadow treasurer Angus Taylor said ahead of the intergenerational report the current economic conditions were unsustainable.

“We have enormous challenges bearing down on Australian households, Australian small businesses right now, we need a government that gets the balance right and does have enough focus on those crisis issues,” he told ABC TV.

“We’ve seen a gain in productivity in our time in government of about 11 per cent. In the last 12 months, we’ve seen labour productivity go backwards by 4.6 per cent, which is completely unprecedented if you go back through the data.”

Following his comments, Prime Minister Anthony Albanese told business chiefs in Sydney the government needed their help to reach critical future targets for climate change, skills and jobs, technology, manufacturing and gender equality.

“I can assure you, my colleagues and I don’t seek your input for the sake of appearances,” he told the Business Council of Australia annual dinner.

“We do it because we want you involved in the design and detail because that’s how we will get the best out of … programs and policies.

“And that’s how we make change that lasts, that endures, that becomes embedded as a driver of success in our economy.”

Greens leader Adam Bandt also called for a progressive tax agenda, saying it could put up to $1 trillion in the government’s coffers over the next decade to tackle intergenerational inequality.

The money would come from a corporate and mining super profits tax, ending fossil fuel subsidies, changes to the offshore gas tax, winding back negative gearing and scrapping the stage three tax cuts.


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