Tisch Lindsay: Taxation (Annual Rates for 2015-16 Research and Development and Remedial Matters) Bill — First ReadingText is incorporated into the Bound VolumeTisch Lindsay: Taxation (Annual Rates for 2015-16 Research and Development and Remedial Matters) Bill — First Reading[Sitting date: 11 March 2015. Volume:703;Page:2167. Text is incorporated into the Bound Volume.]The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member but the time has come for me to leave the Chair.Sitting suspended from 6 p.m. to 7.30 p.m.ALASTAIR SCOTT: I was at the point of explaining the change in the deductibility or the timing of the deductibility relating to the cashing-out of research and development tax losses. I had explained the situation under the current legislation whereby large businesses are able to offset research and development costs against their income streams. I was beginning to explain the current situation with regard to small businesses. A small business is able to create a hell of a lot of losses in their research and development costs taking cash from their own pockets their families and any other supporters that they have but paying the full cost—that full $100 in my example earlier.So a full $100 goes out of that developer’s pocket. In the current situation he can carry those losses forward from year to year to year until such time that income is generated and he can use those losses against that taxable or assessable income to eventually hopefully and possibly create a positive cash flow a positive profit situation in the future. That is obviously a disadvantage compared with the larger business which has positive cash flows from day one. So this legislation enables the investor or the researcher and developer to take those $100 losses in our example and collect that $28 as a rebate as a tax credit. In other words the investor is equalised and is in the same situation and is not penalised for being a small researcher and developer. He is in the same situation as a larger cash flow - positive business.That is important because we need to make sure that we do have an even playing field a fair system and that size does not matter so that the small business guys who have a great idea who want to create an opportunity and who want to get ahead are treated on the same basis as any large corporate that does have a positive cash-flow situation. Once we get those guys up and running once we get those guys humming and creating revenue or at least being able to break even and perhaps even to sell that intellectual property or that patent that they have created it obviously generates a taxable situation so the Government can spend that money. It can spend that tax on targeted assistance where the investment matters.This Government is focusing on that liability—the liability side of our balance sheet. We know where the costs are going to be coming from. We know that the sole parent support benefit is important and we know that every sole mum or dad who comes off the benefit saves us hundreds and hundreds of thousands of dollars. In my electorate I am pleased to say that from December 2013 to December 2014 we have had a reduction of more than 10 percent in those numbers.