1 June 2018

Interview with Leon Byner, 5AA

Note

Subjects: Amazon; delivering a fairer playing field for Australian businesses; ACCC investigation; One Nation; the Turnbull Government’s plan for a stronger economy; Mayo by-election.

LEON BYNER:

Treasurer of Australia, Scott Morrison, thank you for coming on this morning.

TREASURER:

Hi Leon.

BYNER:

What is your reaction to what Amazon is going to do, where as of July 1 they are going to block us all off amazon.com which means, according to our callers, 'hey listen, the range of what you can get is going to be severely diminished'.

TREASURER:

Well, we are not going to be bullied by Amazon because they don't want to pay tax. How many times, quite surely, your listeners have called in and said multinationals must pay their fair share of tax.

BYNER:

Yes.

TREASURER:

Well, what Amazon are basically saying here is 'no, we don't want to do that.' So we don't want to have to pay GST on what we sell in Australia. If you go to angusandrobertson.com.au and you buy a book on there you will have to pay 10 per cent GST on that. But if you go and do it on Amazon you don't. Now, why should an Australian company have to face GST when the foreign company doesn't? This is a bit like, we all know what we think of those who pick up their bat and ball and go home in a huff – and that is what we are seeing here. We are not going to be bullied by, I mean it's the second biggest company in the world run by the richest man in the world and he is saying, if you make me pay tax in Australia I won't sell my stuff to you. Well, I think Australians know how to call that out.

BYNER:

Can I ask you, have you done any modelling on what sort of revenues you might reasonably expect?

TREASURER:

$300 million over the next four years. It all goes to state governments to pay for hospitals, schools and police.

BYNER:

Well, of course you collect that GST and then you redistribute it in the percentages we currently have. So, $300 million over?

TREASURER:

Four years.

BYNER:

Four years, alright. Now, there are those who have suggested and I need you to clarify this one way or the other that the cost of actually doing the compliance…

TREASURER:

That's a net cost.

BYNER:

…won't be worthwhile.

TREASURER:

No, that is nonsense.

BYNER:

Is it?

TREASURER:

We had that assessed by the Productivity Commission, independently, before we moved ahead with this and they confirmed that this was the best way to do the collection and they said it shouldn't be delayed any further, we should proceed and that is what we have done. So, that has been independently verified by the Productivity Commission. Those who don't want foreign companies to pay tax in Australia don't like this measure. I am all for people having choice and all the rest of it but they don't get to come and compete in Australia at an advantage to Australian retailers. That is not fair, that is not right.

BYNER:

What about the observation by those in the retail space that say that Amazon may not be the first company to do this and many overseas companies may do the same thing and kick us out of their stores.

TREASURER:

eBay have already decided that they are going to go ahead with it. This thing from Amazon, they are one of the world's most technologically advanced companies, they have known about this since August of 2015. They face multiple different rates of sales tax, VAT, in countries all around the world and they say they can't work this out. Give me a break.  We have just got to call this out Leon, we really have to call it out. This is a dummy spit.

BYNER:

Do you think once things settle down that you will be able to have the range you have now got on the dot com sites?

TREASURER:

I anticipate that this will continue to expand. That is the direction that retail is going in. Let's not forget it is not just Australian bricks and mortar retailers that we are levelling the playing field for here. It is also Australia's digital online retailers. A lot more of what retailers are doing in Australia today, they are doing online. So, why should they have 10 per cent of what they have to sell that Amazon shouldn't. It is very hard to get past that point, Leon.

BYNER:

Alright, a couple of other things I want to ask you about, as you are the Treasurer. Commonwealth Director of Public Prosecutions is considering charges against the ANZ and the Bank's Head of Treasury for cartel like behaviour. What do you make of this?

TREASURER:

I have got to be very careful about what I say about this because that is now a matter that is going to go before the courts, other than to say that this is the product of an ACCC, the Commonwealth Government's cop on the beat here, conducting an investigation. That is what has brought us to this point and where it goes from here is a matter for the proper process. So, I am not going to pre-judge that as you would not expect me to.

BYNER:

Following the spat between Pauline Hanson and Brian Burston, do you suspect that One Nation might be somewhat of a spent political force?

TREASURER:

Look, I don't know, Leon, but we have seen this movie before. We saw it with PUP with Clive Palmer, we have seen it with One Nation before. We have always said that it is not a stable choice and I think that is what has been borne out and the Liberal and National Parties for those who believe in ensuring Government's live within their means, that we keep taxes low, that we protect Australia's national interest, that we do what I have just been talking to you about – ensuring that multinationals pay their fair share of tax and we stand up to them when they seek to bully us. If you believe in those things, well, then the Liberal and National Parties have always been the ones, the stable choice to ensure that we get those things done. What is happening in One Nation is a matter for them. I don't really want to be drawn into that. It is clear that it is causing a lot of upset and concern within their ranks. The Government, the Liberal and National Parties, remain very focused as we particularly are out there in Mayo at the moment with the by-election coming up of the stable choice of a Liberal candidate, our Liberal candidate there Georgina Downer who has put herself forward, who'd be a fantastic representative in the Australian Parliament and represent the stable Liberal Party choice there to ensure that we can get on and do the things that are important for the country.

BYNER:

So, just as a matter of arithmetic, you need two more votes in the Senate to get your Budget up. Correct?

TREASURER:

About that, yes.

BYNER:

And are you optimistic that you will get them?

TREASURER:

I am always optimistic Leon. I am as optimistic as you are, passionate about Australia's future and the opportunity to do good things. We are very serious about this. We need to ensure that the tax rates that Australian businesses face are competitive and we are very committed to ensuring that personal taxes for all Australians are lower, simpler and fairer and we have a plan for both of those things. We are looking for the support of the crossbench in the Senate to support both of those measures. It is disappointing that the Labor Party once again are proving that the real obstructionists here, doing whatever they can to just try and disrupt the Government and disrupt the country's economy – they just have a very negative agenda. We are getting on with it. We are remaining optimistic and positive about it and Georgina Downer sitting in the House of Representatives as the Member for Mayo will help us get on with all of those important things, particularly paying down the debt. $30 billion in debt will be reduced over the next four years, more than $230 billion in debt paid down over the next ten.

BYNER:

So, when do we have that debt brought back to negative when Peter Costello was Treasurer?

TREASURER:

Well, at the end of that ten years, that is $230 billion, now in nominal terms that is almost three times, well certainly more than two, that was paid down under the Howard Government period. So, that will get us down to about 3.8 per cent of GDP where it is currently peaking at around 18.6. So, that is a very significant reduction over the next decade but as Peter said it does take a decade of consistently strong economic and fiscal management to achieve that. As it did with himself. You have got to have a stronger economy and you have got to keep a tight rein on expenditure which is what we are doing. We have the lowest rate of expenditure growth of any government in more than 50 years at less than 2 per cent. Even under the Howard Government it was 3.3 per cent and under the Rudd-Gillard-Rudd Government it was at 4 per cent.

BYNER:

You would have to hope though, wouldn't you, that in the next ten year period there's no unforeseen global issues, like for example another financial crisis, which would totally upset that apple cart, wouldn't it?

TREASURER:

Well, that would be the case if that had happened during the Howard-Costello Government they wouldn't have been able to achieve what happened.

BYNER:

Scott Morrison, thank you for joining us.

TREASURER:

Thank you very much Leon. Always good to be with you.