Joe Hockey (North Sydney, Liberal Party, Shadow Treasurer) Share this | Hansard source

fundamental injustice because Australia got a goods and services tax. This is the same Prime Minister that has commissioned a new review of taxation and has specifically excluded changes to the GST. He was so opposed to the GST on 1 July 2000 that now he not only wants to keep it but wants to quarantine it from what he describes as a ‘root and branch reform of the taxation system’. What hypocrisy! What a surprise!

We have a Treasurer whose best qualifications for this job were that he was the secretary of the Labor Party in Queensland. Those are the best qualifications he has to be the Treasurer of Australia during a challenging time, but it is not such a challenging time that it prohibits him from unprecedented levels of expenditure outside of war, coupled with unprecedented levels of debt not seen since World War II. It is not so challenging as to prevent the Treasurer from spending yet more money. It is not that challenging for a Treasurer who inherits four per cent unemployment, $40 billion of net assets in the bank with zero government debt, a sustainable budget surplus during periods of reasonable growth and the best terms of trade in modern times. It is not so challenging for this Treasurer, a Treasurer that does not have the courage to come in here and debate. Instead, he sends someone who was still a schoolboy in 2000, when the last tax reform occurred.

The challenge now is for the government to show some courage on reform. Even Ross Gittins, someone who is not particularly enamoured with me—it will come as a surprise that my friend the sandshoe-wearing journalist from the Sydney Morning Herald is not particularly a friend of the coalition—is waiting with bated breath for the day that Kevin Rudd will make a hard decision. He knows, as we know, that sooner or later the rubber has to hit the road. You cannot continue to borrow money and spend. You cannot continue down the path of simply spending money which future generations will have to pay for.

The Henry review was commissioned in an environment where there were unprecedented levels of revenue because the economy was performing extremely well. The Labor Party, with the courage of someone running away from a gunfight, commissioned a review of taxation. Now that they have been hit with falling revenues, we start to see just a little glimpse of the true colour of Labor on the front page of a national newspaper. On Saturday, when I looked at the Australian, I thought this is true Labor: capital gains tax on the family home.

We know the Labor Party have form. Do you remember when Bob Carr in New South Wales introduced land tax on the family home? Do you remember when Bob Carr had that bright spark of an idea to introduce a vendors tax which would completely collapse the property market in New South Wales to a point from which it has not recovered? In Western Australia the Labor Party tried to introduce a property tax on premium property but could not get it through the parliament, and it certainly got an appropriate public reaction. I asked myself: are these guys for real? Are the Labor Party going to do it? They were the guys that came up with the idea of fringe benefits tax. It was the Labor Party that invented capital gains tax. It is the Labor Party that have focused over the last few months on tax reform alone.

The irony of the situation is that Labor say, ‘We’re going to leave all these things to major tax reform.’ In the last few months alone, the Labor Party have introduced a new tax on alcopops, increased the luxury car tax, increased visa application fees, reduced the rebate on private health insurance for high-income earners, removed the taxation exemptions for income earned by Australians overseas, removed concessions for employee share schemes, tightened access to non-commercial business losses, changed the depreciation schedules on computer software, changed the fringe benefits tax and reduced concession contribution caps for superannuation. And they say they are leaving tax reform to the Henry review. They are so opposed to ad hoc tax changes that they are doing all of that and leaving it all to Henry.

When it gets hard blame someone else. That is the modus operandi of the Labor Party: blame someone else. I thought to myself: here we are, Saturday morning, front page of the Australiancapital gains tax on the family home in a report commissioned by the Labor Party. This will be interesting. Then we get a statement from the Treasurer, who says:

There has been no request from the Government … to model such proposals, we are advised that no such modelling is being carried out, and therefore no recommendations of this sort will be made to us …

The Government is not considering and will not consider the policy outlined in that article today.

I thought to myself: could this be Labor tricking again? Could they be just focusing on the $2 million proposal in the Australian? So we came into this place and asked them sensible, straightforward questions: ‘Treasurer, have you ever spoken about or have you commissioned any review of tax on the family home?’ The answer was, ‘I don’t know.’ He flailed around and said, ‘It’s all with Henry and you guys have done this and you guys have done that.’ Then we said, ‘Hang on, you’ve got the Bennett review, which recommends an increase in the Medicare levy.’ He said, ‘You know I can’t comment on the minister for health’s proposal and really you guys ought to get back on track.’ That was his distracted answer when he did not want to tell the truth.

The Treasurer and the Prime Minister want to give the impression that they are opposed to capital gains tax on the family home, yet they are saying on the other hand that they are going to have a root-and-branch review of the tax system. But—by the way—they have introduced numerous new taxes since they commissioned that review and—by the way—they are excluding the GST which the Prime Minister and the Treasurer so railed against when they were in opposition and—by the way—the Labor Party is going to have to make some hard decisions. I will tell you what the hard decisions are, and these are our best estimates because it is incredibly hard to dig these figures out. Since the 2008-09 budget, the Labor Party has committed new, additional spending of $106 billion over the forward estimates. Of that stimulus package, $42 billion is to be spent after 1 July 2010. We have had the Treasurer running around the country for the last 12 months saying, ‘We need fiscal and monetary policy to work together in partnership.’ They are together, two arms on the same body. Now we have the Reserve Bank saying that they are going to increase interest rates, clearly stating, as the markets are indicating, 150 to 200 basis points by the end of next year, and we have the Treasurer saying, ‘We’re not moving on our expenditure program, we’re not moving on our stimulus spending, which stretches out to 2013.’ What a fraud! What the Treasurer has done is to accept full responsibility for two things. Firstly, every interest rate rise between now and when we get back to trend growth is right around the neck of Wayne Swan, and it is around his neck because he is so committed for political reasons to additional spending that he will not pull back. Secondly, the Labor Party have a problem with their numbers. I nearly choked on my Weeties this morning—

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