Australia needs a greater focus on boosting workplace productivity than it needs quick tax reform, the head of explosives and fertiliser giant Incitec Pivot says.
Low productivity is "the nation's burning platform" and it is time for a debate on the issue, according to chief executive James Fazzino.
The problem is more important than the current question of how the federal government raises more revenue and how the tax system needs to be changed.
"I passionately believe it's the wrong question," Mr Fazzino said in an address to the American Chamber of Commerce in Australia.
"We should be asking how do we raise productivity."
Australia is competing with other countries to attract investment, and low productivity is proving a deterrent.
"When I think about my business, there's simply better places to invest than Australia, and if we can address productivity that shouldn't be the outcome at all," Mr Fazzino said.
It has been three years since Incitec Pivot first considered building a manufacturing facility in Louisiana in the US, while also seeking approval to build a facility in Newcastle in NSW.
The Louisiana plant will start production later this year, and will have been approved, built and operating in less time than it takes to get the Newcastle plant approved.
"That's Australia's productivity gap in terms of government regulation and project approvals," Mr Fazzino said.
Red tape remains a problem even though the federal government has for years been working to cut it back, he said.
"At the same time the federal government still produced 16,000 pages of legislation," Mr Fazzino said.
"If you multiply 16,000 pages by six states and two territories and 570 local authorities, you can see that we are still producing a huge amount of regulation.
"Quite often, all the government does is create more problems."
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