The federal opposition is reassessing proposed changes to company tax that would fund its paid parental leave plan which would give mothers their full wage for six months.
Shadow assistant treasurer Mathias Cormann told the Minerals Council of Australia tax forum on Tuesday that costing details have yet to be finalised.
“We are yet to announce how we would propose to fund it in the context of the next election because at this stage we haven’t released our full costings yet,” Cormann said, according to a secret recording which was leaked to the Seven Network.
“We will, of course, wait to finalise our judgements on how to cost our paid parental leave scheme and others until we’ve seen what the true state of the budget is when the Treasury secretary and the Finance secretary release the Pre-Election and Fiscal Outlook 10 days after the election has been called.”
Cormann’s comments suggest a change from the opposition’s original plan to fund the scheme, which is estimated to cost $4.4 billion a year.
Under that plan, the paid parental leave scheme would be funded by a 1.5% increase in company tax for Australia’s biggest businesses and a $100 million budget top up.
Company tax rates for all businesses would be decreased by 1.5%, leaving Australia’s top 3200 businesses paying the 30% tax rate while all others would pay 28.5%.
The Australian Financial Review reports the opposition intends to keep the 1.5% increase on company tax to fund the paid parental leave but is reassessing the size of the reduction.
But a spokesperson for shadow treasurer Joe Hockey downplayed the rumoured changes to SmartCompany this morning.
“What Mathias was saying was that policy for paid parental leave will stay as it was at the 2010 election,” he says.
“There is no change to that policy.”
The spokesperson said the opposition cannot finalise the funding of the paid parental leave scheme until the Pre-Election and Fiscal Outlook is released.
“We won’t yet because we don’t know the final state of the budget yet and we can’t know that until the Pre-Election and Fiscal Outlook, only at that stage can we marry up our costs,” the spokesperson says.
Peter Strong, executive director of the Council of Small Business of Australia, told SmartCompany his main concern is any involvement of small businesses in changes to the funding of the scheme.
“I don’t mind as long as we are not involved in any way, shape or form in the administrative process or the funding of it,” he says.
“Our biggest bugbear with the current system is that we have to administer the government’s payment system.”