Tony Smith (Speaker) Share this | Link to this | Hansard source

I have received a letter from the honourable member for McMahon proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The government’s plan to harm household budgets and the Australian economy with a 15 per cent GST.

I call upon those honourable members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

The mendacity of the Turnbull government has been on display for the Australian people in the question time which we just witnessed. The trickiness, the willingness to engage in the lowest of standards that the Turnbull government is prepared to engage in was on display for the Australian people over the last hour.

But it is not just the saga of the Special Minister of State. It is not just the saga of the Ashby affair in which we see those low standards and that mendacity. It goes to the living standards of the Australian people as well. It goes to this government's plan to hit the living standards and the cost of living of the Australian people. There is one thing that is clear about this government's approach: they want to increase the GST. They want put it on fresh food, health and education and they are going to be mean and tricky about it as they go.

The term 'mean and tricky' was coined for a former Treasurer, but it should, perhaps, have been kept for this Treasurer because it is even more applicable to him. He has been at the dispatch box over the last 48 hours, Inspector Clouseau-like, saying he knows that the previous government had modelling on increasing the GST. Maybe he knows that because we told him! Maybe he knows that because the previous government had an inkling that the Liberal Party would propose increasing the GST and said to the Australian people, 'Here are some of the impacts.' Maybe that is how he worked it out!

What he did not tell the Australian people is that he has modelled it as well. He said, 'The only people who've modelled the GST are the Labor Party—nothing to see here.' It turns out there is something to see here. You can see that in The Sydney Morning Herald, which says not only that the former Treasurer, Mr Hockey, had modelling done of an increase in the GST but that it is 'now with his successor, Treasurer Scott Morrison'. It is a cracker of a read, if you have not seen it so far, Mr Speaker. I would recommend to you the entire edition of today's The Sydney Morning Herald.

It is not just that, because the Treasurer has now provided us with an alibi. He says, 'Well, maybe I did get it modelled, but the states made me do it.' It is all at the request of Mike Baird. 'I didn't really want to do it,' said the Treasurer. 'The states made me do it.' That is all very convenient. He has not released his modelling, he has not released his plans, and I suspect I know the reason—because it is not pretty reading, because we know enough from what is on the public record of the modelling of an increase in the GST what impacts it would have. Somebody on an average income would lose $3,100 a year or $60 a week, and somebody on an income of $50,000 would lose $2,100 or $40 a week. These are people who cannot afford this loss. We know that is the case under this government, which, as recently as today, is threatening to cut family tax benefits. We know that is the case under this government, which has seen lower wages growth and which has seen living standards fall.

We also know that people will lose not just from an increase in the GST but from it being applied to more things. A very big proportion of the household budget, of the weekly shop, is fresh food—and so it should be, because it is very important to our nation's health. A big proportion of the budget of many families is health—large families dealing with health issues. We know that if the GST is applied to these things, people whose income is in the lowest 20 per cent will pay seven per cent more but those whose income is in the top 20 per cent will pay just three per cent more. We know that is a fact. I suspect the Treasurer's modelling tells us that as well—or tells him that, at least.

We know the Treasurer's other alibi. He says, 'Don't worry that. There is nothing to see here, because we're going to cut taxes as well.' But we know from the NATSEM modelling that if a five per cent tax cut is provided across every tax bracket then that is going to make the package even more regressive; it will hit low-income earners even more compared with just increasing the GST. So it is time for the Treasurer to come clean, to lay out not only his modelling but his plans—his plans to hit the Australian people and their cost of living. We know that this is not just about the hip pocket; this is also about the health of the Australian people—something the member for Ballarat has been particularly active in pointing out and particularly effective in doing so. The President of the AMA said:

A GST on health would penalise the poorest and the sickest in the community when they are ill.

…   …   …

Ensuring that the Australian people have affordable access to high quality health and medical services is a core function of responsible governments.

The Government must rule out introducing a new regressive tax on health, and instead concentrate on increasing its investment in the high quality health services and hospitals that are needed to meet growing demand.

So we know what the AMA think of putting a GST on health. The Rural Doctors Association has said:

To add a GST of 10% or 15% onto the cost of a consult at the local doctor's would literally be too taxing for many rural and remote patients, with the danger being that many may decide not to seek treatment from their local GP.

We heard a lot from the National Party in yesterday's MPI, because they were sent out as the alibi because no Liberal wanted to do it. Let us hear from the National Party on this MPI as well, saying that a GST should be put on health in rural and regional areas. Let us hear the National Party disagree with the Rural Doctors Association. It is not just about a GST on health; it is also about a GST on fresh food. The President of the Public Health Association, Professor Heather Yeatman, put it well when she said:

Now is definitely not the time to be considering a GST on basic healthy foods. Diet-sensitive chronic disease due to unhealthy eating is now the greatest factor affecting overall burden of disease in Australia, even greater than tobacco. With funding already cut to many of our preventive health programs, it is not the time to add further to the burden of disease. The GST exemption for healthy foods in Australia must be retained.

So we know this to be the case. We know the impacts of an increase in the GST on family budgets and on family health, yet this Treasurer and this Prime Minister seem determined to do it and not to be honest about it, not to be up-front with the Australian people, not to be clear about their plans to engage in a mendacious campaign at this dispatch box. That is what this Prime Minister and this Treasurer are determined to do.

Then there is the impact on the economy. We saw in the national accounts today growth of 0.9 per cent. That is better than last quarter; that is welcome. It was a terrible quarter last quarter. We are glad that it is better than 0.2 per cent. We are concerned that net exports contributed 1.5 per cent to growth, so it would have been a very bad set of figures indeed without net exports. Domestic activity is very troubled under this Treasurer's watch. We know what a GST would do to the economy as well, because we have the lived history.

In the year 2000, when the GST was introduced, the wholesale sales tax was abolished, so taxes came off as a new tax came on. So its inflationary impact was less than putting a GST of 15 per cent on fresh food. This would be more inflationary than the GST itself was 15 years ago. We know that when that happened 15 years ago the Australian economy went through its worst six-monthly performance in 24 years—worse than the global financial crisis. Following the introduction of the GST there was a miserly 0.1 per cent growth in the September quarter and a negative quarter of 0.4 per cent in December. We saw the then Treasurer rush to stimulate the economy, as he was desperately concerned he would have a recession on his watch. We saw unemployment grow from about six per cent in June 2000 to about seven per cent in June 2001, as the GST was being introduced.

The Treasurer has the gall to stand there and lecture us about jobs and growth when we know the impact of his policies on both jobs and growth. That is the impact that we have seen before—90,000 people added to the unemployed list. So many times we have seen the Turnbull government trying to say, 'Yes, but the last two years is all in the past. Don't worry about the patchy economic performance of the last two years—it is all in the past. It was not us.' 'It wasn't me, Guv,' says the Prime Minister. I have to tell you, Mr Deputy Speaker, that I am not a very good golfer—I don't actually play golf any more. The member for Watson is a good golfer—

Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

No, I'm not. Where did you get that from?

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

The member for Corio is an excellent golfer. Senator Conroy is not a bad golfer. The member for Hunter I understand is pretty handy—he has never invited me to a game—but he is pretty handy. I am a very bad golfer—I don't play any more—but I do know one thing about golf. There is a process we used to engage in when I played golf, called 'the mulligan', where you have another go if you do not get it right the first time. We have the Prime Minister engaged in one big national mulligan—'Have another go, don't worry about the first time. We didn't mean that. We might see economic growth going backwards.' Is it any wonder that this government, the new Prime Minister and Treasurer are struggling with this set of figures? They are struggling with the circumstances that they will make worse by increasing the GST. They will make them worse by putting the GST on fresh food and putting the GST on health and education. They will make them worse through their actions and their rhetoric. Is it any wonder that this Treasurer is universally known as WTH—'worse than Hockey'?

Alex Hawke (Mitchell, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

We are really going through the motions now, at this time of the year, with the shadow Treasurer coming in here again and again with the same tired old rhetoric about a GST plan which the government does not have and which the government has not announced. He is telling old golfing stories—he is now at the level of telling his golfing war stories of how good his handicap is. I am not sure that the constituents of McMahon or even Fowler, to name another electorate that the shadow Treasurer might be interested in, would be so interested in his golfing analogies. The constituents out in Western Sydney might prefer to hear about the NRL or they might want to a story about the Wanderers, but I am not sure the golfing analogy is going to go down all that well in Fowler. I am not sure that you want to go doorknocking to tell your golfing buddies how you do the mulligan. I would invite the whole Labor Party to come doorknocking with me to tell them what avid golfers they are. They have time to play golf. The rest of the country, of course, has to get on with the job of building growth and investment and providing the savings this country needs to run a stronger economy.

On a day when we see the national accounts showing that economic growth strengthened in the September quarter and that we are making a positive transition from the end of the mining boom into new areas of the economy—the broad based growth that we will need to function—it is ironic that the Labor Party is coming in here to sell their doom and gloom, their scare story or their 'not so scary scare campaign', as the Prime Minister says, against a goods and services tax.

It is ironic, too, when you consider Labor history. It does seem that the shadow Treasurer is stuck in 1998. Let's listen to some of the people who have supported GST—the attitudes of some Labor figures to the GST, Labor luminaries that people used to vote for. Let's start with the Leader of the Opposition, Bill Shorten, who said, 'Labor has always believed in broadening the base and trying to lower the tax rates.' He also said, 'This government doesn't have the courage to argue for a GST.' Or let's go to Geoff Gallop, a distinguished former leader, who said, 'I have been on the record for some time talking about the need to increase the GST. I think the time has come to take that step.' No-one in the government has made that assertion that it is time to lift the GST, but Geoff Gallop said that.

We could move on to John Brumby, another distinguished former premier, who said, 'If you look at all of the arguments and all of the facts, it is inevitable that we need to increase the GST.' That is not a member of the government's economic team or a minister in this government or a member of the backbench—that is John Brumby, former Premier of Victoria. We can go then to the Premier Jay Weatherill, the current Labor Premier of South Australia. We are going pretty well—we've been to Western Australia, Victoria and so now let's go to South Australian Labor. Jay Weatherill has said, 'We do need all of these things'—referring to a goods and services tax in, increasing the rate, increasing the base; that is the context of his remarks—'on the table.'

Would you think that the ACT Labor Party would be a little different on this? Would you think they would have a different view? On the question of raising the rate and of increasing the base of the goods and services tax, Chief Minister Andrew Barr said, 'We are open to the proposal.' We know that the shadow Assistant Treasurer, Dr Andrew Leigh—a member of your own shadow economics team— is certainly open to the proposal. Just read his books—I encourage the shadow Treasurer to get a copy. I have signed copy in my office in pride of place on my desk.

If that is not enough, we can go to former Labor premiers in New South Wales, the biggest state and the biggest part of this country's economy. We have the shadow Treasurer completely out of step with almost every Labor leader or former leader of the past decade. Former Premier Christina Keneally said, 'The GST is obviously part of the mix.' Then let's go back to Victoria, where Labor Premier Daniel Andrews has said: 'We would not support any changes to the GST but in the event that a federal government were elected on a platform and had a mandate to do it—well that is a different issue.'

The shadow Treasurer is stuck back in 1998 and he seems to continue to litigate an argument not against an increase in the rate or against an extension of the base of the GST now—he is arguing against the original goods and services tax every time he makes an argument in this House. This week he asked a series of inspired questions about what happened to growth in Australia, following the introduction of the original goods and services tax—as if the goods and services tax is bad for the economy in general. He was saying that there was a six-month period where growth suffered, but then he conveniently neglected to examine the next decade, where we removed dozens and dozens of taxes, including the wholesale sales tax and many other inefficient taxes that were holding our economy back. You do not just look at the next quarter or the quarter after that to say what happened after the goods and services tax. Have a look at the next decade, have a look at the efficiency that was created in the economy with those consummate income tax cuts and the entire package that was presented to the Australian people.

The shadow Treasurer has mounted the most bizarre argument in Australian economic history, that we should somehow replace the goods and services tax because we had some negative growth following its original introduction. That is the argument he has mounted. He is not arguing against a contemporary increase in the GST, he is mounting no case against that—he is saying look at the original GST. He is saying the original GST was a bad idea. How would you replace the revenue that is raised from the GST that goes to the states, shadow Treasurer? This is the question you need to answer. You cannot continue to stand there at the dispatch box day in, day out, month in, month out, every question time, asking absurd questions—it is like it is from the school of absurdism—and litigating an argument against a goods and services tax; not just some increase, not just an extension of the base, but arguing against the original goods and services tax. The original goods and services tax is what you have been arguing against in question time this week. You have to answer a question: what would you do differently in government?

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

Roll it back.

Alex Hawke (Mitchell, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

Would you roll back the GST? My colleagues quite rightly refer to rollback. Where have we heard rollback before? We have heard rollback before. You did have a plan to roll it back but then you had six years in office when, if you wanted to roll back the GST, you could have taken that action. You could have continued to litigate this argument. But the argument against the GST vanished as soon as you secured office in 2007. From 2007 to 2013 the Labor government made no argument against the GST. In fact, there was action taken on the GST that we know about—just like Paul Keating's option C, the then Treasurer had three scenarios modelled on increasing the rate and expanding the base of the GST. We still do not know what is in those scenarios. The Australian public do not know what was in the modelling or the directions that the then Treasurer gave for the modelling, for the extension of the rate and the increase of the base. What were they? We have part of scenario three, which was increasing the GST rate to 12.5 per cent and broadening the base. It is the estimated weekly price impact on households in 2014-15. This is actual Labor Party modelling that was done at the direction of the former Treasurer, who is now the shadow Treasurer. He says that we are modelling something, but he is the only one who has received modelling.

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

You've got a copy of it.

Alex Hawke (Mitchell, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

We have a copy of it. There is no other modelling. But we do not know what was in scenario two and we do not know what was in scenario one. Tell us—you are here now. You have just spoken on a matter of public importance on the GST so why did you not tell us what was in scenario two or scenario one? Was scenario one extending the GST to health and education? Was scenario two extending the base of the GST to fresh food? Was scenario two an increase in the rate to 15 per cent, or was it 20 per cent? We know scenario three was an increase in the GST rate to 12.5 per cent. It is this government that is getting on with national growth and that has a plan for economic growth and jobs, and the national accounts figures today bear that out. We are going to continue to pursue that plan.

Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

That was spectacular—absolutely spectacular!

Alex Hawke (Mitchell, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

Hear, hear! Stop there!

Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

He wants me to stop there; that will do! I love it when the member for Mitchell stands up and says 'What Labor has to do is tell the parliament how they will respond to get rid of the policy that we will not tell you we have.' That is his argument. There is a demand for Labor to say how they would subsequently respond without the government saying what they would do. The other thing that I love is when he refers to modelling that was done. There is something in common between the modelling he referred to and the modelling that is in the paper today. The modelling that he referred to was Labor wanting to model a Liberal Party proposal, and what is in the paper today is the Liberal Party wanting to model a Liberal Party proposal. That is what is in the paper today. All the times we have had Treasurers stand there looking back at Labor and saying, 'Oh, the only modelling that was ever done was when you were in government and you were trying to cost what we were talking about,' they were holding modelling of their own to prepare for their own proposal and not letting the Australian people know.

It is no surprise that they did not want the Australian people to know, because if you expand the base and increase the rate of the GST you end up with something that households cannot afford, the budget cannot afford and the economy cannot afford. On household considerations, NATSEM modelling shows that people in the lowest 20 per cent of income brackets pay seven per cent more. People in the highest 20 per cent of income brackets pay just three per cent more. That is why they support it. It is right in line with the economics that the member for Mitchell has believed in all his political life—the magic of trickle-down economics, the whole concept that the more you earn the lower the percentage of your income you should pay in taxation. That is exactly what is delivered by the GST being expanded in its base and being increased in its rate.

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

Would you roll it back?

Mr Tony Burke (Watson, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Here we go again—'Would you roll back what we won't tell you we'll do?' Genius! Modelling shows a typical Australian family will be up to $5,000 worse off as a result of an increase to and broadening of the base of the GST. It hits those who can afford it least. They then talk about being able to fix it with compensation. People who are outside of the payment system are unable to receive compensation in that form. It is one thing if you have kids under 13 and you are still within the family tax benefit system, but if you have teenage kids and you are outside the payment system, how do you then get compensated? The member for Mitchell says that you do it with income tax, forgetting that Labor took a million people out of the income tax system. We tripled the tax-free threshold, taking it from $6,000 to $18,200 before you pay a dollar in tax. For people on modest incomes, whatever shifts they might think they are going to do, the capacity to deliver for lower and middle income families has largely been taken away by the shifts in the income tax scales. I do not doubt for one minute they would be able to find a way to compensate people at the top end, but for everybody else, particularly people under mortgage stress, people who would seemingly have high incomes but have very little disposable income, for them no compensation package will change the fact that every time they do the grocery shopping the bill is higher

Who would ever think that it was smart to put a price on fresh food? What are you trying to discourage? If you are going to put a price on carbon, you are trying to discourage pollution. If you are going to put a price on tobacco, you are trying to discourage the use of cigarettes. What sort of policy genius would think that was a good idea to increase the price of fresh food and, indeed, to do it by the full 15 per cent? Let's not forget that there is no longer a wholesale sales tax to remove, which, as the shadow Treasurer said, was there when John Howard introduced the 10 per cent GST. You removed the wholesale sales tax and, while we still opposed the GST at the time as regressive, you did not have the inflationary impact of the full 10 per cent. But when you do not have that to get rid of any more, the inflationary impact is the full increase. (Time expired)

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

Here we are again. I am here to talk about one of my favourite topics: Labor's lies. Just when you think the scaremongering campaign cannot get any lower, it does. But honestly, I am not at all surprised. Why, you ask? Let me give you just some examples of the lies that are happening on the Central Coast at the moment. Last week, Labor and the union bullies turned up outside my office to protest. They took their photo outside the sign and then they berated me for not being there—I was here in parliament representing the people of Dobell. Local unions and Labor members like to turn up in places where they know I am not going to be. Then they complain about me not being there. Last week I was in parliament. When I was at a community event they decided to hold the debate that never happened. On a weekend, when I am out and about in my community and not sitting in my office, they are out there scaremongering to local retailers about penalty rates—another union and Labor lie.

Last week, when they were on their national tour of marginal seats, they dropped into Dobell. After taking their photo, they decided to pack up all their stuff and then they plastered it all over social media saying that I was not there. Then they went into a coffee shop, where they were seen stocking up on their coffee, water and supplies for their day. Guess what? They paid for it—one person used a union credit card. They cannot even put their hands in their pocket to buy their own water! There are no rules when it comes to the union credit card. Then, on Sunday, they decided to turn up outside a Mariners versus Wanderers game and they red-carded me for not being there—I was on my way down here to Canberra. No doubt, they paid their admittance fee to get into the soccer using the union credit card.

We go back to the debate that never was—we know that Australian electorates are being subjected to an expensive $30 million campaign of deceitful and pathetic lies in an attempt to embarrass the government and marginal coalition members in electorates such as Dobell. In my electorate the deceitful and misleading campaign was orchestrated by the ACTU, the CFMEU and the Central Coast Community Union Alliance. Despite their pathetic attempts and considerable monetary investment—we estimate that they would have spent $20,000 of union membership money on that night—it did not work. After they made all their robocalls, four people called the office asking—

Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Relevance?

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

It is relevant because it is all about Labor lies and union lies. It is about your 'BFF's the unions—sending them out there to spread all your lies—and all the money that is wasted. Four people contacted my office to ask where I was—and, of the 101,000 people in Dobell who are enrolled voters, 227 contacted me to complain about the union. So thanks for getting my name out there, unions, I appreciate it! For the Labor Party it is all about getting noticed. When I stand here and talk about the scaremongering campaigns, I speak firsthand from what they are doing out there. There are lies about the GST. The GST will be the unions' next campaign in all the marginal seats. Those opposite prey on the weak and vulnerable in our community. We know that when Chris Bowen was Treasurer he secretly modelled an increase to the GST and a broadening of the base. Any changes to the GST would only be considered if put by the states and territories—we all know that—because it is the states and territories who receive the revenue from the GST. Such a proposal would also have to reduce taxes such as personal income tax and increase income support payments to ensure that vulnerable Australians are not adversely affected, as occurred when the GST was first introduced. But all we get from those opposite is more taxes—and now this other lie about the GST. We are not raising the GST. And where did you get the magic number of 15 per cent from? Mr 15 per cent himself. We have not seen him for a couple of days. Where is Mr 15 per cent? (Time expired)

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

When government members of parliament come in here and say words like 'not so scary scare campaign' then you know they really are scared. When they have a contribution that does not even talk to the actual motion before us until a minute to go, they are doing everything but facing the reality of what people in their electorate are saying about the GST. Who is not in this place ready to debate this motion? None of the Nationals MPs are here today. None of the Victorian Liberal MPs are here. Perhaps that is because last week in The Weekly Times no fewer than five Victorian regional MPs told us the truth about what they think about this government's plan to increase the GST. Let us count them off. We had the member for Mallee, the member for Murray, the member for Wannon, the member for Gippsland and the member for McMillan all telling the paper about their fears and anxieties if this government increases the GST and if this government put it on fresh food. Those opposite cannot even get their own to be on the same page when talking about their GST campaign.

Guys, just be honest. Come out and tell the Australian people. They expect it from you; you're Liberals. You are Liberal members, who look after the big end of town and not the other end of town—working people, people in regional electorates, people who are telling us loud and clear that this will be the tax that breaks the bank, that hurts these households.

And country people are not alone. The National Farmers Federation have come out and said that they disagree with this government's plans. The National Farmers Federation said:

From our viewpoint, it makes no sense to increase the cost of fresh food. After all, Australians need greater incentives to eat healthily, not disincentives …

The National Farmers Federation is correct. Maybe that is the reason why the Nationals MPs are not in here—because the NFF have been on the phone and said, 'You'd better vote against this one.'

We have also had the Rural Doctors Association saying that adding a GST of 10 to 15 per cent to the cost of health care will hurt regional communities. It will hurt them the most, because, to put it simply, people in the regions will just not go to the doctor. They will not seek the preventative health care that they need.

This is what the Liberals seem to do. This is what this government seems to do. They try and push through a GP tax; it gets rejected. They try and push through a petrol tax; it gets rejected. So, now it is: 'Let's just be lazy and put a straight-out tax on everything, broaden the GST and increase it for everybody.'

What else is under attack with this broadening of the GST? Petrol. Petrol is a classic one. Remember, the petrol tax was originally frozen when they introduced the GST. John Howard said, 'Don't worry; I'll freeze the fuel excise tax.' Then, in its very first budget, this government sought to increase the petrol tax again. Now that they have succeeded in increasing the petrol tax, they want to increase the GST and whack another five per cent on petrol. For people in regional areas, this stinks, because they literally have further to go. It is understandable that the Prime Minister is not upset about this; his electorate is only 11 kilometres wide. Try being a regional MP. For people who live in Heathcote, it takes them 45 minutes to get to Bendigo, where their regional health services are and where their high school is. People in country areas, because they are regional areas, drive further. Broadening the GST to 15 per cent and including petrol will hurt people in regional areas.

Let us talk about rates. This government will not rule out increasing the GST on council rates. Our council areas in regional Victoria pay more in rates than in our cities. In the Macedon Ranges, the City of Greater Bendigo, Loddon Shire and Mount Alexander, people have already had 18 to 20 per cent rate increases over the last three to four years. The state government there is going to cap rates because that is just too much for those households to bear. Now, to rub salt into the wound, these people are going to have to pay extra anyway because the federal government will not rule out increasing the GST on rates.

Be honest with the Australian people. When you are back in your electorates, be honest and tell the truth. Tell the truth about what your plans are—that is, to increase the GST. It will hurt the economy and it will hurt regional communities the most.

Rick Wilson (O'Connor, Liberal Party) Share this | Link to this | Hansard source

I start today by taking to task the premise of this MPI, and that is 'the government's plan to harm household budgets with a 15 per cent GST'. The government does not have a plan to introduce a 15 per cent GST. We are having a debate about the best tax system for our country, going forward—a mature debate, one would hope. But I lost count of the number of times the member for Bendigo used the words 'rule in' and 'rule out'.

Some members on the opposite side would remember Mr Ken Henry, who was the Secretary of the Treasury, who produced a report about our tax system which he gave to the then Labor government, and the government sat on for some three months and, in that period of three months, ruled out just about every tax measure in that report, bar one. That was the mining tax, which I will come back to in a little while.

This GST debate, this tax debate, seems to have been going on just about all my adult life. In 1985, we had the then Labor Treasurer Paul Keating promoting option C of his taxation paper, which he was rolled on by his own party. We then had John Hewson in 1993 bring forward a comprehensive reform package and—perhaps a tactical mistake—release it a little bit too early. After some initial very strong support, Mr Keating, then the Prime Minister, managed to politically destroy that package. Then, in 1998, we had John Howard and Peter Costello. Mr Howard had the political skills and the political courage, along with the Treasurer of the day, to introduce this comprehensive and probably most significant reform of our tax system, and we are still benefiting from that today.

What did the Labor Party do in response to that tax reform? They had a campaign called 'roll-back', which was the backbone of the ALP tax policy for many years. It was simply: 'We'll just roll it back.' After a certain period of time, that became unsustainable, but I am still not sure that they have moved on. Perhaps they have moved on, because we know that the then Treasurer and now opposition Treasury spokesman did commission some research on a 12.5 per cent GST. It is a shame that he has not released that research to the rest of the parliament so we could all have a good look at it.

So, what is Labor offering in terms of the tax debate? We know that they want to reintroduce a carbon tax. With their inflated targets, we are talking about a hit of around $600 billion to the economy and a hit of around $6,000 per family.

We had the mining tax, which as I mentioned was the only tax initiative that came out of the Henry review. While it did not raise any revenue, it damaged the investment environment and drove investment capital away from the Australian mining industry. Certainly, people in my electorate will take a long time to forget the mining tax. There is the multinational tax policy that they have brought forward which many people in the business community know will just drive away investment again.

And while we are crying crocodile tears about low-income families, a packet of cigarettes under the Labor proposal will cost people $40, and many of them are on low incomes. That equates to a lot of money per week. If we are talking about damage or impact on low-income families, a $40-a-day cigarette habit is pretty damaging. What are we really trying to achieve at the end of this debate? We are looking for a better tax system, a more efficient tax system and a fairer tax system which will allow the country to grow, will grow our economy, will grow the number of jobs and will grow the number of people in work—people who have the dignity of work and who are earning good incomes.

I want to close by noting that any GST changes will need the agreement of all the states. As a very proud Western Australian, I know that the Premier of Western Australia, Colin Barnett, will not agree to any change to the GST base or level without a fundamental change to the way the GST is distributed. As you would know, Deputy Speaker Goodenough, WA is currently receiving around 30c in the dollar per dollar of GST that we pay, and that system is unsustainable. I know that any change to the GST will see WA receive a much fairer share.

Tim Watts (Gellibrand, Australian Labor Party) Share this | Link to this | Hansard source

Every so often the debate in this House amongst the political class in Australia becomes a little bit disconnected from reality, a little bit disconnected from what is actually going on in the community. It is hard to believe, I know, but it is true. At the moment, something of a collective swoon seems to have taken over the political class and some of the members of the press gallery, love them as I do. Everyone is swooning for this new Prime Minister, Malcolm Turnbull. I can understand it. He is speaking in full sentences, and that is a welcome relief; it is a welcome change from his predecessor. The number of sentences is less appealing. It is even less appealing that many of those sentences are about himself. But we will adjust to that. What this swoon hides is a real anxiety in the Australian community, the Australian public. We are in the lead-up to Christmas at the moment, and, in the lead-up to Christmas, Australian families do their Christmas shopping, plan for the school holidays and plan what they are going to do for Christmas lunch. Those cost-of-living pressures are really front of mind around the kitchen table, around the dinner table, when we are planning for these things. This anxiety is being fuelled by the actions of the new, Turnbull-led coalition government, by the constant attacks on weekend rates and by the secret plan being pursued by those opposite to increase the GST by 50 per cent, revealed in the Sydney Morning Herald this week after being denied by the Treasurer recently.

I have a message for the Australian public. I have a message for the people in this building. I will do something that I do not believe has been done before in this chamber: I will quote Flavor Flav. I will say, 'Don't believe the hype,' because when Malcolm Turnbull tells you that there has never been a more exciting time to be an Australian, I can tell you the Australian public are not excited about the prospect of a GST. Some may be resigned. There might be a bit of a feeling that this is a fait accompli, given the amount of talk that we hear from those opposite about it. But I say to the Australian public that this is not inevitable and we should fight it. Labor is taking a stand against the secret plan of those opposite to increase the GST by 50 per cent.

The public talk about a lack of resolution in politics sometimes, but Labor's resolution on the GST is clear: the GST is bad for small business, it is bad for everyday Australians, and it is unfair. The Prime Minister likes to say that there will be no tax reform from those opposite that will disadvantage the most vulnerable Australians. Again I say, 'Don't believe the hype.' This government has an appalling record when it comes to fairness. This government has an indefensible record when it comes to the most vulnerable Australians. When we look at NATSEM's modelling of a prospective GST, we find that a 15 per cent GST applied to everything would cause people in the lowest 20 per cent of income brackets—the vulnerable people the Prime Minister talks about—to pay seven per cent more. People in the highest 20 per cent income bracket would pay just three per cent more of their income. A typical Australian family would be $5,000 worse off. It is a tax that targets the people who are least able to afford it.

But we are told by those opposite that the PM would never bring in a tax increase that was unfair; they would compensate people. But I say to the Australian public, 'Do you trust your family budget with the coalition?' This is the same coalition, the same party, the same members sitting opposite, that brought you the horror Abbott budget, about which the current Prime Minister, Mulligan Turnbull—sorry, the member for Wentworth, Malcolm Turnbull—told Alan Jones:

I support unreservedly and wholeheartedly every element in the Budget. Every single one.

This was a budget that, according to NATSEM, would make a couple with two kids in the lowest quintile of Australians 6.6 per cent worse off, while a couple with two kids in the highest quintile would be 0.3 per cent better off. Does that sound fair to you? It does not sound fair to me.

The other bizarre thing about what those opposite are proposing is that their secret plan to increase the GST by 50 per cent seems to be the solution to every problem in Australia. The Treasurer says we do not have a spending problem in Australia; we have a revenue problem. Those opposite have a hype problem when it comes to the GST. So far, the coalition has said that a GST could pay for putting back the $80 billion in school and hospital funding that they cut, cutting personal income tax, cutting company tax, abolishing stamp duty on insurance, abolishing payroll tax, abolishing stamp duty, cutting fuel excise to abolish car rego fees and paying down the national debt. As I say, it is not a spending problem; it is a hype problem. When it comes to hype, there is no bigger hype than the nonsense that is being spouted by the Treasurer about tax policy. He says that when the coalition does tax reform it reduces taxes. He says that the coalition does not deal with revenue by jacking up taxes; that is the Labor way. When you look at the trajectory on this piece of paper—I know that the Treasurer it is not particularly good at numbers at the moment because he still has the training wheels on—the blue represents the coalition and the red represents Labor. The figures go up under the coalition, and they go down under the Labor Party.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

Order! There is to be no use of props.

Tim Watts (Gellibrand, Australian Labor Party) Share this | Link to this | Hansard source

They are the facts. Do not believe the hype.

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

The lived experience of a Labor government is that policy is something that is done on the run. The mercurial maestro himself, the former member for Griffith, personified this. This MPI is all about plucking numbers from the air and wishing them to be true. Indeed, it is similar to Labor's plans for a 50 per cent renewables target: fanciful, frothy and fictional. It is feel-good politics at its very worst. In this coalition government, however, we do not do feelings; we do facts. The fact is that the government has a plan—an innovative, agile strategy for better jobs and stronger growth.

The biggest threat to household budgets in this country is the Labor Party. Their policies and plans destroy jobs, rack up debt and wreck livelihoods. Many opposite, ex union officials, have been insulated from the real world. They have not been exposed to the realities of the private sector. They are not familiar with retrenchment and redundancy. The best way to understand the difference between a recession and a depression is, as Ronald Reagan said: 'When your neighbour loses his job, it's a recession. When you lose your job, it's a depression.' Liberal governments get this. And this coalition government knows that a rising tide lifts all boats.

The next critical plank of our platform for jobs and growth is the national statement on science and innovation. The people of my electorate of Tangney are excited about what might be contained in that statement. They are enthused by the optimism of this government and repulsed by the relentless, risible and wrecking ways of Labor. We know the plan is working. The facts speak for themselves. GDP figures released in just the last couple of hours show economic growth accelerated sharply in the September quarter, with the biggest jump in exports in 15 years. Gross domestic product rose 0.9 per cent from the June quarter. Annual growth accelerated to 2.5 per cent from 1.9 per cent. Both figures beat economists' forecasts of 0.8 per cent and 2.4 per cent respectively.

What of Labor's plan? We know from Treasury documents that Labor secretly modelled an increase to the GST and a broadening of the base when the member for McMahon was Treasurer. Why didn't Labor have an honest and transparent conversation with the Australian people about their plan to increase the GST? Why did Labor look at increasing the GST in secret? Of course, Labor have form on working on GST plans in secret and then campaigning against anyone else who considers the GST in public. Remember former Prime Minister Paul Keating and Option C? He wanted a GST and then campaigned against Fightback! The difference is that our government is calling for an honest, open conversation, versus the sneaky, secretive, closed attitude of Labor. Consider this in the light of Labor's $51.6 billion budget black hole of promised additional unfunded expenditures.

Our National Platform for Economic Growth and Jobs will back Australia and Australians who are out there working hard for themselves and their families, saving for their future and investing in themselves and their fellow Australians. The Commonwealth's Infrastructure Growth Package announced in the 2014-15 budget is increasing productive capacity, generating jobs, and expanding business and labour market opportunities. I see this in my electorate, with the commencement of the game-changing $1.6 billion Perth Freight Link project. Labor's economics are pure fantasy. They want to tax their way back to growth—a new mining tax, a bigger carbon tax, a job-killing multinational tax and a massive cigarette tax! The Labor philosophy is: if it moves, tax it; and if it doesn't move, tax it again.

In summary, the best way to boost any household budget is a better paying job, and this government has a plan to deliver an innovation-led, job-rich, high-value growth strategy. Come the election, the question to the people will be: who would you rather have running the show—the Leader of the Opposition or the Prime Minister?

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

It is a great pleasure to follow the member for Tangney and to hear his fantasy, his fiction, when he talks about the performance of the government. It is pure fiction when he talks about how the Liberal Party can save Australia. To know that, all we have to do is look at how the budget has blown out under this government. It is all fantasy.

When talking about a plan for Australia's future, the one thing we know is that we have a government whose only plan is to push through the 2014 budget. The one thing all Australians know is that you cannot trust a Liberal government when it comes to the GST and taxing Australians on low and middle incomes. For that matter, the one thing Australians know is that you cannot trust the Liberal government when it comes to taxing, because the highest taxing governments in Australia's history have all been Liberal governments.

Government Members:

Government members interjecting—

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

You can use whatever arguments you like, you can use whatever rhetoric you want to, but the proof is there. The highest taxing governments are Liberal governments, and they stand condemned for that. They stand condemned for trying to convince Australians that they are there to create a healthier economy, that they are there for them. Their healthier economy is hitting those on low and middle incomes and then putting a great big tax on everything; it is hitting families with a 50 per cent increase in GST, not a 15 per cent increase. Let us look at it in real terms. This Liberal government is looking at increasing the GST by 50 per cent. That is an enormous increase and it will have an enormous impact on families. It is also looking at extending the GST to everything—the great big tax on everything. This will hit Australians from the time they are born until the time they die. That is what this government is about—hitting Australians, hitting people who can least afford it and looking at making their lives difficult.

I was mesmerised as I watched the member for Dobell's contribution to this debate. It seems to me that she has been stalking union officials. Why would you stalk union officials when you are back in your electorate? Surely, you would be working with your constituents. She actually had four people ring her office. If there were robo calls going out to constituents in the Shortland electorate, they would be ringing me and telling me. To be quite honest, when the changes to the boundaries occur, part of the Shortland electorate—Lake Haven and Gorokan—is deemed to go into Dobell. Those two areas are low-income areas, and I know—because I am regularly in those areas and I will regularly be in those areas—that the people living in those areas do not want an increase in GST. They do not like the government's attack on the family tax benefit. They know that those on the other side of this House have absolutely no concern for them. And they will be very interested when they find out that instead of listening to people, the member for Dobell is actually stalking union officials when she should be out there fighting for her constituents.

Today we learnt another fact: former Treasurer Hockey had a plan—a cunning plan, an evil plan—to sneak in a GST extension. It was pretty obvious to all of us on this side of the House that that was where the Treasurer was going. But a GST extension will be bad for health and bad for education. We need Australians to be able to afford to purchase fresh food. We do not need disincentives for their being able to purchase food. We do not need disincentives for their being able to go and see a doctor— (Time expired)

Michael Sukkar (Deakin, Liberal Party) Share this | Link to this | Hansard source

It is very hard to follow the member for Shortland because the gallery are applauding rapturously now, after that great contribution. Well done, Member for Shortland. This is an embarrassing MPI from a bereft shadow Treasurer who was a failed Treasurer in government. The greatest legacy of the member for McMahon is the fact that he left a $30 billion black hole in the very short period of time that he was the Treasurer of this country. So for him to bring on this MPI is desperate and it is a distraction. It is an absolute outrage, quite frankly. We are wasting the parliament's time speaking about this.

The Labor Party have, by all accounts, about $50 billion to $60 billion of increased spending or cuts that they do not approve of that they will need to find. Up until now, I have been wondering where they are going to find this money, where are they going to find the $50 billion to $60 billion? The member for Shortland just outlined why the Labor Party are the party of small government and low taxes, which was a bit of a surprise to most of us, but where are they going to find that $50 billion to $60 billion? It was all answered this week, when we found out that the Labor Party plan on introducing a $200 a ton carbon tax, a $600 billion handbrake on this economy. I say to Labor: I am very, very happy to fight the next election on a $200 carbon tax, given you went so well with a $23 carbon tax last time.

Can we just move on from this charade that the shadow Treasurer is trying to undertake today? This is a waste of the parliament's time—and this from a man who commissioned modelling from Treasury on a range of scenarios for increasing the GST and broadening its base. In the short time that he was Treasurer of this country, he racked up a $30 billion black hole, which we fixed, and he got modelling done on how to increase the base and the rate of the GST. I say to the shadow Treasurer: release all of the questions, the assumptions and the modelling that you did. The member for Watson said, 'No, we just wanted to model what would be future Liberal Party policy.' Release what you are saying will be future Liberal Party policy; let us see it. Understandably, we are very, very cynical about the Labor Party's rhetoric, which in opposition is very different to when they are government. I grew up watching Labor Party politicians railing against the GST and its regressive nature and how it would hurt low-income earners. The minute they got into government, they were quiet; they never spoke once about the GST. And now they are back in opposition, they have discovered the GST again. If the GST is so regressive, have the courage of your convictions and take as a policy to the next election that you will roll back the GST.

Every argument I have heard today is an argument against the GST. It is not an argument against an increase; it is an argument against the GST itself. Unlike you, we do have the courage of our convictions. We went to an election and said: 'The carbon tax is a handbrake on our economy. If elected, we will repeal it.' That is exactly what we did. We did the same with your disgraceful mining tax, and you wonder why nobody believes a word you say on tax. They wonder why no-one listens to them on tax. This is the party that basically tried to nationalise our mining industry, through the resource super profits tax, then they rolled Rudd and then they did a deal on the MRRT that raised no money! It raised no money, but it had $16 billion worth of expenditure associated with it. This is why no-one takes you seriously when it comes to tax policy, and, quite frankly, you have not done the work in opposition in two years to fix that.

So when we have ridiculous MPIs like this today, it is an absolute bore for those out in the community and it is a waste of this parliament's time. We are having a mature discussion about what we can do to fix Labor's mess. You have embedded a structural deficit in this country that is going to take a lot of work to repair, and we have people like the Assistant Minister to the Treasurer, the member for Mitchell, who is at the table, who are working feverishly to fix that. Now, get out of the way; stop using it for political point-scoring because, firstly, it is not working and, secondly, it just further debases your standing in the eyes of our constituents. Look, if you want to keep going this way, by all means do. We will fight an election on a $200 carbon tax at the next election very, very happily, but other than that you have got nothing to say about tax, so please cease.

Ian Goodenough (Moore, Liberal Party) Share this | Link to this | Hansard source

Order! The discussion has concluded.