Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018
House of Representatives, 22 May 2018
Watch Matt's Speech
Mr KEOGH (Burt) (13:28): We've already heard in this debate particularly from the member for Melbourne, who has demonstrated why you can never trust the Greens on the economy or, in fact, to do anything really for the benefit of ordinary Australians. But then we heard from the member for Fairfax, who was railing against neo-Marxism when the irony is that the main proponent of Marxist ideology in this parliament sits behind him. The member for Warringah is proposing the nationalisation of the means of production, wanting the government to buy a coal-fired power station that is actually going to close. Not only does he want to own the asset; he wants to own assets that will be worthless. And the member for Fairfax can't even take it. He's walked out of the chamber because he can't accept that the only proponents of Marxism in this house are actually on that side of the chamber. The hypocrisy that we have coming out of here is amazing.
The DEPUTY SPEAKER ( Mr Rob Mitchell ): The debate is interrupted in accordance with standing order 43. The debate will be resumed at a later hour.
Mr KEOGH (Burt) (16:29): On budget night, the Treasurer started his speech with the rhetorical questions:
What are you going to do now? What does it mean for me?
We know that these were rhetorical questions because, clearly, he doesn't want to actually answer them. Indeed, so concerned is the Treasurer that he's also refused to even answer the simplest questions about the centrepiece of his budget: the tax cuts that this legislation seeks to implement.
To be clear, there are parts of this plan that we can get behind. Labor will support the government's proposed changes that are to take effect from 1 July this year. If the government split the bill so that we could vote for the 1 July changes only, it could have our full support and they could pass instantly. Low- and middle-income earners could walk away with an extra $530 a year for the next few years, but they won't this year as long as the government continues to be unable and unwilling to provide, or is perhaps deliberately hiding, specific details of its plan, including the year-by-year cost beyond the forward estimates. After getting nowhere with the Treasurer himself, Labor have now asked Treasury for more detailed financial information so that we can have better information about what the government is actually proposing with these cuts.
2022 is a long way away. 2024 is even further away. For the government to say that they are certain they can deliver tax cuts for 2024 is really a bit of a joke. The government are locking in policy commitments that will not come into force for seven years. That's more than two elections away. We don't know what the world will look like then. It seems apparent they have no idea what the world will look like then because they seem unable, or at least completely unwilling, to provide any of their modelling to support what the costs of this plan will look like. The Treasurer contradicts himself in the budget papers, stating, 'Risks appear more balanced in the short term,' but also stating, 'In the longer term, the global economy faces further challenges.' The Treasurer knows that this plan becomes more and more unstable the further it gets from now. It's no secret the upcoming election is essentially now going to be fought on tax. The government are hoping that, by dangling the carrot of up-front tax cuts before ordinary working people of Australia, they will accept even bigger tax cuts for higher income earners. But the people of Australia are clearly more wily than this Prime Minister or the Treasurer.
Not only does the income tax plan pander to the top end of town, leaving low- to middle-income earners wanting, but under the Liberals the costs of living are also rising. Workers in retail, food and accommodation industries are losing up to $77 a week in penalty rates under this government. Pensioners are being slugged around $20 a week for private health insurance, and the government wants to remove their energy supplement. Some families are even copping an extra $40 a week for childcare fees. The budget also fails the fairness test on Medicare. The Prime Minister's freeze on the rebate for specialists means that Aussies will have to pay even more as they go to visit a doctor for specialist care. This plan by this government is not about fairness for families, it's not about being fair for pensioners and it certainly isn't fair for low-income earners. This budget looks after big business at the expense of those people who work and struggle.
The people of Armadale and Gosnells have an average income of just over $60,000 a year, meaning that the vast majority of residents are effectively now at the mercy of this budget. The people of Burt elected me to this parliament and I'm here to do my utmost to represent them and fight for them. I note the jeers coming from the member opposite, the member for Tangney. I'm sure that he will be very happy with this budget because the average income of those in his electorate is quite a bit higher. But, with more than 168,000 people in the electorate of Burt, the vast majority of whom will be worse off under the way this budget is constructed, I'm not going to let these issues slide.
Perhaps if the Liberal Party had been responsible in this budget and in the tax plan that they're introducing in this legislation, we would be having a different conversation. After all, the initial plan for those tax cuts to come in from 1 July is not that bad, and we support that part of the proposal, but, instead, down the track the Liberals are once again doing their utmost to pander to the top end of town. It's Malcolm's 'mates rates' under this tax plan. While we haven't been given the full picture by this government, early indications are that, once the government's three-stage package is fully in place, it will deliver larger benefits to those on higher incomes—disproportionately so. As part of the new proposal, low- and middle-income earners will get a tax offset in 2018-19, with high-income earners getting very little. This part of the plan still remains somewhat progressive. More money will go to lower earners in that tax cut. But we're asking for more information about the proposals for 2022. If the government wants to be judged on the fairness of its package, the government should provide the distributional analysis for the year that the full package is in place.
The tax cuts mean that by 2024-25 high-income earners will gain $7,000 per year in tax cuts while those earning between $50,000 and $90,000 a year will gain only $540 a year and, wait for it, those earning $30,000 a year will see only a $200 gain. Where's the fairness in that? In fact, 60 per cent of the cost of this tax plan comes from stage 3, which is when the high-income earners will receive the largest tax cuts. The cost to the budget over the medium term, we understand, is out at $140 billion, but the government refuses to give us any breakdown as to what the costs are as part of each of those three stages. Prime Minister, Treasurer, will you now be willing to provide that more detailed information—a year-by-year breakdown, the individual components of the stages—so that we, as a parliament, who you are now asking to vote on this tax plan, can help put the people of Australia in the best financial position?
While the Liberals are being stingy on their tax cuts for ordinary working Australians, you may ask the question, almost as the Treasurer did on budget night: what are the Liberals spending their money on if it's not on ordinary Australians? Well, it seems they're spending $50 million on the commemoration of the 250th anniversary of James Cook's first voyage to Australia. I'm sure that, like me, the member for Tangney—being a good representative of Western Australia, an area of the continent discovered and examined by European settlement long before Captain Cook made his way over to the east coast of Australia—will raise an eyebrow as I did, because the Treasurer will splash money on this anniversary to make sure that he creates a four-year program to be covered as part of this budget. There'll be a plethora of new facilities and activities down at Port Botany to celebrate the event. I'm sure when people fly into the airport they'll see it all happening. Where is this location? Where is Port Botany? Where will this be celebrated? It will be in the Treasurer's own electorate.
What's the alternative, Australians ask. A Shorten Labor government will deliver bigger, better and fairer tax cuts for more than 10 million working Australians. In many cases these tax cuts will be nearly double what the government is putting on offer for low- and middle-income earners. Labor's tax refund for working Australians will increase the tax cuts that are on offer in the current government's proposal. Everyone earning less than $125,000 a year will receive a bigger tax cut under Labor compared to the Liberals, ensuring that more than four million people will be better off every year under Labor's tax plan. In addition to our commitment to a bigger, fairer and more affordable income tax cut, Labor will invest $2.8 billion for a better hospital fund to deliver more beds in emergency departments and wards, more doctors, more nurses—more health staff. We will restore the $17 billion that this government has decided to cut from school funding. We'll abolish up-front fees for 100,000 TAFE students who choose to learn the skills that Australia needs. That will be part of a $470 million investment in TAFEs and apprenticeships, which is much more than the $270 million that this government has decided in its budget this year to slash from TAFE. We can do this because there is one thing that the government is doing that we will not do, give an $80 billion tax cut to big business and the banks. Australians know the phrase: 'Well, compare the pair.' When it comes to tax cuts, when it comes to funding essential services and when it comes to budget repair that is not only effective but fair, Australians should compare the pair. They will find that this government will be left wanting, because only Labor will ensure that we have a fair go for all Australians.