Transcript | Sky News First Edition | 19 June 2025

Thursday 19 June 2025 

Interview on Sky News First Edition 

Topics: Productivity roundtable, tax reform

EO&E………………………………………………………………………………………….. 

KENNY HEATLEY: Joining me live now is Shadow Finance Minister James Paterson. Good to see you James, thanks for coming on this morning. Jim Chalmers says all ideas out of the August productivity round table need to be budget neutral or budget positive. Is that a signal that we may just see more tax beyond superannuation considering that most initiatives to boost productivity in the economy would probably cost the budget in the short term, to get to long term gain? What's your view? 

JAMES PATERSON: Good morning Kenny, I mean the starting point is we welcome the government's recognition that we have a productivity crisis in this country which has occurred on Labor's watch. We've gone back a decade in productivity back to 2016 levels and if that trend continues Australians will become even poorer than they did in the government's first term which is to lose about 6.3% of their living standards. So we need to be talking about productivity and a productivity round table is a good first step. But we need more than just a meeting, we need a plan of action to come out of it. Like you, I am concerned that the Treasurer is possibly preparing the ground here for higher taxes. And in the middle of a productivity crisis, and particularly in the middle of a business investment crisis - which is at decade lows - the last thing the Australian economy needs right now is higher taxes. We are up for a conversation with the government to work with them constructively to make our tax system more efficient, to collect revenues in ways that are less distortionary. But we are not going to give them a blank cheque to increase taxes on Australians at the worst possible time for our economy. 

KENNY HEATLEY: The 25 seat allocation for the productivity roundtable is still not finalised. No word yet if yourself or Ted O'Brien or Sussan Ley are invited? 

JAMES PATERSON: I saw the Treasurer say yesterday at the National Press Club that by necessity, because it's in the cabinet room, the meeting would have to be relatively small and only about 25 people would be able to attend. I know the Treaurer's got many talented people on his staff and I think they're capable of booking a larger meeting room in Parliament House that would allow him to invite more people if he wishes. It's not necessary that it be held in the cabinet room, it could be held anywhere in Parliament House in a way that could facilitate broader participation, including from the Opposition. So I hope they get out the schematics of Parliament House and look at the room list and see the other options that are available to them, if they want to be more inclusive in this process. 

KENNY HEATLEY: Jim Chalmers said he has an open mind for the productivity roundtable, but the super tax on unrealised capital gains is off the table. Finance academics say the net result will be super funds will not invest in start-ups, which is a sector vital to Australia's productivity and growth. What's your reaction to that? 

JAMES PATERSON: Whether this was the policy intent or not when superannuation was created, superannuation - particularly from self-managed super funds - has become one of the ways in which people invest in early stage companies and effectively provide venture capital finance in this country. Now if you start to tax unrealised gains then no one in their right mind would use this vehicle to invest in early stage companies. Because their valuations can wildly fluctuate and you could have an up round which significantly increases the value on paper of those shares without actually realising any of the benefit of that gain and you'd be up for a massive tax bill under the Treasurer's tax on unrealised capital gains. That's a huge mistake. We have decade-lows business investment. The last thing we need to do is to make it any harder than it already is to invest in early-stage companies and start-up companies. We need a dynamic, entrepreneurial economy and the Treasurer's plans are going to put a wet blanket on that. 

KENNY HEATLEY: The Treasurer has warned that the global transition to net zero will impact the huge revenues the budget receives from resources and that's driving part of the need for tax reform. Can critical minerals fill the void and what's your view about electric car tax as well? 

JAMES PATERSON: Well, Australian minerals and resources are critical to a net zero transition that the globe is going through. You can't have a net-zero transition without building many of the modern technologies that are required and they require the inputs of critical minerals, as you say, which is a huge opportunity for Australia. But also just more fundamental, basic minerals and resources to make steel, to make aluminium, to make modern technological components that rely on products like copper to go in them. So it shouldn't necessarily be the case that Australian revenues are hit by this transition. There are huge opportunities and if we have the vision to seize it - we should take advantage of that. 

KENNY HEATLEY: Okay, James Paterson, appreciate your time this morning. Thanks so much for joining us.

ENDS

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