Hockey considering means testing childcare rebate

Hockey considering means testing childcare rebate

Joe Hockey is considering means testing the childcare rebate if he becomes Treasurer.

The Shadow Treasurer used his budget reply speech on Wednesday to outline a number of reforms the coalition government would pursue.

One suggestion was to look at means testing or lowering the childcare rebate if the budget position worsens.

He said this wouldn’t happen if it discouraged women from working.

“That is one of the areas you'd be most reluctant to change.”

According to Finance Minister Penny Wong: “What he did make clear is he's prepared to hack in to childcare support for families.”

He also pledged that under the coalition, all small businesses that provide services to the Commonwealth will get the benefit of a "pay on time or pay interest" approach.

That means if an account is not paid by the Commonwealth within 30 days, interest will be paid at the same rate that applies to late tax payments.

"Small businesses work hard for their money and should not be bankrolling government," Mr Hockey said.

One of his relatives has told 7News that poor economic conditions has forced him to shut up shop.

His cousin Gus Doughman has recently closed one Italian clothing store and is struggling to keep the other one open.

He says, he's never seen things this bad: "We need leadership from the government, we need optimism, we need certainty."

Hockey also used the speech to make clear that he would look into the tax office, accusing it of being overaggressive in pursuing disputed claims.

"Taxpayers are not the enemy. They should be respected."

Mr Hockey said if elected, a coalition government would immediately establish a standing parliamentary committee to focus on the oversight of tax administration.

The committee will also hold an inquiry about the way tax disputes are handled.

Mr Hockey says taxpayers need to know their concerns are being heard and they are being treated fairly.

"We all have to pay our fair share of tax," Mr Hockey told the National Press Club in Canberra on Wednesday.

"But the relationship with the ATO does not have to be adversarial and should be based on mutual respect."

Mr Hockey said if the oversight committee believed it was necessary, the coalition would break up the tax office so that its policeman functions were separate to its responsibility for administering the tax system.