Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Assistant Minister for Defence) Share this | Hansard source

I thank the member for Curtin for raising this important issue of tax reform. It allows me to report to the parliament the details of some of the substantial tax reform that's already undertaken and implemented by the Albanese government.

I think it's fair to say that this government has undertaken the most substantial tax reform of any first-term government since the Hawke government of the early 1980s. The principles that we've used to underpin the tax reform that we've undertaken have been encouraging hard work and aspiration amongst Australians, ensuring that the taxation system is efficient in the way that it collects taxes from Australian households, individuals and corporations and ensuring that the system is fair—that everyone pays their fair share of tax. We have done this by consulting and listening to the Australian people.

Recently we heard their message about Australian households and how tough they're doing it with cost-of-living pressures. That's why we listened and acted with Labor's income tax plan that is currently going through the parliament. Because we acted, 13½ million Australians will be better off, with substantial income tax cuts and more money in their pockets from 1 July this year. This will help greatly with household budgets and provide much-needed belief to Australians who are doing it tough.

As part of Labor's tax plan, three million more Australians will receive a tax cut compared to the previous government's plan—100 per cent of taxpayers compared to 84 per cent under the previous government's stage 3—which is a substantial increase in the number of Australians receiving relief from 1 July. Ninety per cent or 5.8 million women will receive a bigger tax cut under Labor's proposed tax package compared to the opposition's. This will assist with reducing gender inequality in incomes in our country, and those in occupations that are dominated by women, such as nurses, teachers, early childhood educators, will be some of the biggest beneficiaries of Labor's new tax plan. And we're increasing the threshold for the 37 per cent and 45 per cent tax rates to ensure that we're returning some of the bracket creep that's been occurring because of increasing inflation and the effect that that's been having on people's after-tax incomes.

For most governments that tax package would be enough for one term. Most governments would say, 'That's a substantial reform to income taxation in Australia, and that is enough for one government to undertake in a term of government.' That was certainly the case for the previous government. They weren't proposing any major tax reform beyond that proposed by stage 3 in this term of government. But our government has not shied away from further reform to ensure that our taxation system is efficient, is fair and is encouraging aspiration amongst Australians. We're also undertaking reform of corporate taxes, of superannuation and of the resources tax.

When it comes to the petroleum resource rent tax, we know that mining resources have been a fundamental part of the strength of the Australian economy and have contributed much to national income over the last century. These are resources that are owned by the Australian people collectively, and this government wants to make sure that the Australian people get a fair return for the exploitation of those resources by those corporations, particularly when the incomes that are derived from that mining go to funding the infrastructure that is fundamental to moving those resources around our country and across the globe. The reforms to the petroleum resource rent tax that we are undertaking will ensure that that system is much more efficient and fairer by introducing a cap on PRRT deductions that corporations can claim and strengthening the anti-tax-avoidance measures in taxing the offshore resources sector. This will ensure that the Australian people get a fair share of the resources that they own and the profits that corporations make from exploiting those resources.

When it comes to superannuation, we know superannuation was established to ensure that Australian workers had dignity in their retirement and a decent quality of life when they left the workforce. It wasn't established as a vehicle for intergenerational wealth creation. But, unfortunately, over time, because of the concessions that existed under the previous government, that is what it has become. This government is reforming the taxation of superannuation to ensure that it meets its intended aim of providing that dignity for Australian workers in retirement. We're doing that by reducing the tax concession for superannuation balances that have very, very large balances for individuals. From 1 July 2025, a 30 per cent concessional tax rate will be applied to future earnings on balances above $3 million. We're introducing fairness back into the superannuation system. Importantly, we are willing to take this reform to the next election to get the approval of the Australian people for it.

We're also introducing a multinational tax integrity package.

There's nothing more frustrating for Australian workers than seeing a substantial portion of their pay packets sent over to the Australian Taxation Office every week or fortnight, when large multinational corporations are able to shift profits to other jurisdictions where they're operating and minimise their tax and in some cases avoid paying any tax in the Australian jurisdiction. There is nothing more frustrating that gets up the noses of Australian workers.

This government has listened to Australians about that frustration and we are acting to make sure that the corporate taxation system is fairer through changes to the thin capitalisation rules and denying deductions for payments made to related parties in relation to intangible assets. We are making the taxation system for corporations and multinationals much fairer.

Importantly, we are also introducing new reporting requirements so that Australians, who have the right to know just how much tax multinational corporations are paying in Australia, can get access to that information, improving the transparency and accountability of our taxation system for hard-working Australians and, in doing so, introducing greater integrity into the way our taxation system works. So our government is undertaking substantial tax reform to ensure that our taxation system is fairer and more efficient and encourages aspiration in the Australian economy.

Good governance is about getting good outcomes for the benefit of the Australian people. When it comes to tax reform, it has been tough to achieve those outcomes for the Australian people. There have been plenty of policies put up by governments and oppositions that have hit the fence, that have never been implemented and never delivered tax reform for the Australian people. That has been a characteristic of debates about tax reform in this place for the last couple of years. Inevitably, you get that predictable and inevitable opposition from oppositions when it comes to tax reform that makes it almost impossible to undertake in this country and makes it almost impossible to modernise the taxation system.

The Albanese government has listened to the Australian people and consulted with the Australian people, but most importantly it has delivered outcomes for Australian people. We are in the process of delivering the most substantial outcome for workers in this country by delivering more of their hard earned into their pockets from 1 July and acting on bracket creep, which has not been done for the last decade. We've listened to the Australian people and we've been successful in getting outcomes on their behalf. That is exactly what tax reform should be about. We know how difficult it is to achieve substantial tax reform in this country. It has to be about achieving outcomes. The government understands and knows that the best way to do that is make sure you are consulting with the Australian people and you are undertaking gradual reform to ensure they understand the process and, most importantly, that the Australian people support what the government of Australia is doing.

That is exactly what the Albanese Labor government is delivering for the Australian people: substantial reform of our corporate taxes; making the superannuation taxation system fairer and ensuring it meets its intended aims of providing dignity for Australian workers in retirement; returning bracket creep to the Australian people; acting on the cost of living pressures that households are facing; and delivering a fairer, more efficient, more effective taxation system for the Australian people.

See this speech in context