Janelle Saffin (Page, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Treasurer, what income tax relief can Australian families expect from 1 July this year?

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Page for her very important question, because I think the government absolutely understands what life is like for many families and many people on fixed incomes who are grappling with a very tight household budget. We understand that. As the Minister for Veterans’ Affairs was saying before, that was one of the reasons that we moved to put in place the historic increase in the age pension and disability support pension—something that had not been changed for a long, long time. This was a historic and very significant increase in the base rate of the age pension and disability support pension, because we recognised that many of those people were doing it tough. That is something that we did in very difficult budget circumstances last year but not something that those opposite could find the political will to do in almost 12 years. We moved to do that because we understand what life is like when people are on tight budgets.

We understand the importance of employment when people are trying to pay the bills. That is the fundamental reason why the government put in place the substantial, powerful and temporary stimulus into the system—to support employment, because if you do not have a job it is pretty hard to put food on the table and to meet the family costs. So we moved with the stimulus to protect households, to protect their employment and to keep the doors of small business open because we understand how difficult it can be for some people to make ends meet. That is why we are also delivering a third round of tax cuts, which will be coming through this Thursday.

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

They’re not yours!

Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Link to this | Hansard source

They are ours. We have delivered two and this will be the third. We are proud that we are delivering these tax cuts because we do understand what life is like for people on low and middle incomes and for people on fixed incomes. We have been focused on that from day one. We have been focused on it in terms of child care with substantial increases there. We are focused on what life is like for people on low and modest and middle incomes when it comes to paid parental leave. Of course, that is why the third round of tax cuts, which are going to be delivered next Thursday, are so important and why the government is so committed.

For a worker earning $50,000 a year, the tax cut starting on 1 July this year is worth $450 a year. We understand that that is not a lot of money, but it will help make ends meet. It is very important to give this extra help that can make a difference in terms of tight family budgets. This means someone earning $50,000 a year is now paying $1,750 less in tax than they were when the government came to office. That has been a very substantial cut to their tax bill in the period that the Rudd government has been in power of almost 20 per cent.

What we are doing is putting more incentive into the system for the people who work hard, and that is important. It has also been accompanied by a range of other measures in terms of child care, the education tax rebate, paid parental leave and, of course, as I mentioned before, the very substantial measures that have been put in place to support employment and to keep people in jobs. We are proud of the support that we are providing to people on low and middle incomes, because it is support that they have earned, it is support that they deserve and it is support which will help them in the long run meet the costs of living, but, more importantly, it will strengthen our economy because it rewards Australians who work hard to make our country great.