Treasurer Scott Morrison insists the government is rolling out a better tax system, as a key independent senator made broad reform a condition of his support for corporate tax cuts.
On Tuesday, the government shelved laws reduce the corporate tax rate to 25 per cent for all businesses over the next decade.
The bill won’t come back on for debate until parliament sits for the Budget in May.
The decision came after government negotiators failed to win over two crossbench senators – Victoria’s Derryn Hinch and South Australia’s Tim Storer.
Senator Storer told parliament on Wednesday, in his first detailed comments on the bill, that reform needs to go much further and giving such a large cut is not justifiable when the budget is in deficit and debt is high.
He says there are many other changes, dating back to the Henry tax review eight year ago, which should be progressed.
Senator Storer is also calling for the Newstart allowance to be increased and brought under an independent system of regular review and adjustment, similar to the way in which the minimum wage is raised.
However, Mr Morrison says the government has made substantial progress in tax reform, from superannuation changes to income tax cuts for middle-income earners and ditching the mining and carbon taxes.
‘The government’s enterprise tax plan is part of a broad set of initiatives to grow our economy,’ he told ABC TV.
‘There is a broad suite of measures.’
Independent Derryn Hinch, who holds the other outstanding vote, wants the government to help pensioners, make rental housing more affordable and cut out taxpayer subsidies for the legal costs of alleged pedophiles caught overseas.