Up tax creek without a cross-bench

The corporate tax reform proposal in the May Budget was a bold pitch in an otherwise underwhelming document. The staggered introduction scheme of cuts was quick to receive criticism.

Despite Scott Morrison and the Coalition promising investment, jobs, growth and a bright future for real wage rates, the package was unlikely to succeed in a Senate that had so often delivered parliamentary gridlock.

Three months on from the Budget announcement, a new Senate has been delivered with three additional cross-benchers and three fewer Coalition senators.

While reforms to small business taxation are supported by key cross-benchers, the Nick Xenophon Team, as well as Labor, the proposal is far from wholly embraced.

The major point of contention for Opposition and cross-bench members is the perceived benefit to be reaped by corporate Australia. Conveniently ignored is the fact that big corporates would still be subject to a tax rate of 30% until 2023-24.

While the Opposition continue to argue no clear electoral mandate was acquired in the narrow Coalition victory, their resistance to change is a continuation of a narrative railing against the success of large corporates in Australia.

This message has proliferated in the absence of strong rebuttal from the Coalition.  The reform package is essential if Australia wants to continue to compete in the global capital market. Despite this, Xenophon maintains that the government have not adequately presented the case for universal cuts.

For Morrison and Turnbull to succeed in passing the reforms package they must present a decisive argument and target the micro-party voting blocs.

Without support from Xenophon and Pauline Hanson, Malcolm Turnbull may just find himself up tax creek without a cross-bench to rely on.

Miguel Forjaz is an intern at the Centre for Independent Studies