Senior Labor MP Gary Gray has defended the lack of costings detail around Prime Minister Kevin Rudd's proposed tax break for Northern Territory-based businesses.
Under the policy announced on Thursday, NT companies could enjoy a corporate tax rate a third lower than the rest of the country under the creation of a special economic zone in the territory.
Mr Rudd didn't provide any costings details, which has been branded a "thought bubble" by the coalition and criticised by NT Chief Minister Adam Giles and WA Liberal Premier Colin Barnett.
Mr Gray, the federal resources minister, said the northern Australia plan was a policy initiative which fell outside the budget four year forward estimates.
"As a consequence of that, the costing of these things is done based on forward estimates, it's not done on the basis of the back of an envelope," he told reporters in Perth.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
Mr Gray dismissed suggestions the tax break was too generous, saying it would be carefully thought through and implemented over the five years to 2018.
"In a way, that supports the diversification of the economy of northern Australia, and in particular, of Darwin," he said.
