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 unfair priorities on tax.

I call upon those 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

I might start this contribution perhaps a little unusually by saying how grateful we are on this side of the House to the Prime Minister for highlighting the differences in our approach on taxation today. He was down at CEDA, doubling down he was, in defence of the government's tax plans. And he was highlighting the difference in approach between the government and the alternative government, and we welcome that very much.

We welcome the opportunity to debate the competing tax plans between the government and the alternative government, because they are different. The Australian people do face a choice at the next election between the plans of the government and the plans of the opposition. It is very clear that the government's plans are inconsistent, incoherent and, most of all, unfair. They are unfair and they are completely inconsistent with everything they have said previously.

We used to hear how the Liberal Party was the party of low tax. Just a few weeks ago we heard about how they were the party of low tax. In fact, they even tried it at question time, somewhat unusually, like those $20 billion worth of tax rises in the budget just did not happen. But in the spirit in which I started, I give credit where it is due. We try to be fair on this side! The government is half right: they are the party of low tax for high-income people. They are half right! And they are the party of high tax for low-income people. That is where it goes wrong. There is a rather important caveat now, a rather important little footnote on the slogan 'party of low tax'—footnote: 'but not for low-income earners'. We need to make sure we have truth in advertising; there has to be a caveat every time they say it.

We even saw it in question time. The Treasurer was asked about plans to reduce tax and asked about alternative policies. Well, he could have said, 'Yes, there are alternatives,' like his own! Like his own, which increases tax on people earning $21,000 in Australia today. The Treasurer got himself into all sorts of bother during question time because he was outraged—outraged!—at Labor's policies. He said that Labor believes that if you earn $87,000 you are rich, and that Labor will increase the tax on people who earn $87,000 and more. And he is right. The trouble is that so will he, by the same amount, for $87,000! The difference is that he will also increase tax for Australians earning $21,000 and more. On the logic that the Treasurer applied he thinks that people on $21,000 are rich! That is the only logical conclusion that you could reach from the Treasurer's remarks at question time.

The fact of the matter is that there are 10 million people in Australia for whom the government wants to increase tax while we do not. That is the fact of the matter. That is the key choice for the Australian people. Somebody earning $60,000 will pay $300 more under this government but high-income earners will get a tax cut. They say, 'Yes, but the deficit levy was only ever meant to be temporary.' It was also meant to exist while there was a deficit, and the deficit now is 10 times bigger than what it was predicted to be in Treasurer Hockey's first budget. Remember him? Treasurer Hockey? I will come back to him in a little bit.

It is 10 times bigger than it was predicted to be in his first budget and yet they find it within themselves to lift the deficit levy and give high-income people a tax cut. Somebody earning $190,000 will get a $200 tax cut, somebody earning half a million dollars will get a $6,400 a year tax cut and somebody earning a million dollars will get $16,400. We asked the Prime Minister in question time: how many people on $60,000 a year will have to pay increased tax to fund the tax cut for one person earning a million? He could not answer; he did not answer. We will answer it for him: 55. Fifty-five people earning $60,000 will pay more tax just to fund the tax cut for one person earning more than $1 million.

It is not just about the Medicare levy. It gets worse. They did not stop there when that is comes to tax rises for low-income earners. It has not received as much attention, but the government wants to change the arrangements for people who commit the crime of going to university in Australia. That is what they want to do. They say: if you work hard and get yourself into university, you should start paying more tax at $42,000 a year—the princely sum of $42,000 a year. So, if you are a graduate, for example, on $50,000 a year, you will pay $250 more on the Medicare levy increase and you will pay $1,000 more on the HELP repayments. So much for a housing affordability plan if you happen to go to university! That is what the government's contribution is. For those people who went to university, it is more debt. As the old saying goes: if debt is the problem, more debt is not the answer. They could apply that to university graduates as well. We saw this as the centrepiece.

The Prime Minister was out again this morning. Taking his glasses off and putting them back on again—spirit and passion, arguing against an increase to the top marginal tax rate. It was going to be a prosperity killer and the of end Western civilisation if the tax rate went up to 49½ per cent. It is fine at 49 until July 1, but on July 2 when we proposed taking it to 49½ per cent, it is a prosperity killer. That is a problem for the government. Again, we saw the government arguing that the deficit levy was only temporary. That was their intention. When it comes to low-income earners, the pension cuts were permanent. When it comes to family tax benefit cuts for low-income earners, they were permanent. When it comes to unemployed people, those cuts were permanent. They managed to make the only measure which applies to high-income earners temporary. Well, in this situation it should not be temporary. In this situation, where we have the government at sixes and sevens—they have lost $2 billion since budget day on the bank tax, and yet they say they can afford to find the money for a high-income tax cut.

Again the Prime Minister was out today saying the government will take half your money. I thought I had heard this before, this confusion between marginal tax rates and average tax rates. I thought 'I've heard this before'. I thought, 'Who said that?' It was our old friend Joe Hockey. He is back! The former Treasurer is back. He argued this and he got pilloried. Commentators put it out that the Treasurer did not understand the difference between marginal tax rates and average tax rates. The fact of the matter is that under Labor's plan, for somebody on, say, $200,000, their average tax rate would be 34 per cent. That is not a punitive tax rate. That is the average tax rate. And the Prime Minister, I suspect, understands that. When the Treasurer says something like that, you are never quite sure if he understands or if he is being dishonest. But with the Prime Minister we have a better idea; he actually does understand it but he chooses to misrepresent. That is not even taking into account the tax concessions which benefit high-income earners, which this side of the House will reform in government—like negative gearing, like capital gains tax, like superannuation, like accountants' fees and lawyers' fees, which this side of the House will reform and that side of the House simply refuses to do.

Again we see the Prime Minister crying crocodile tears for high-income earners, saying how terrible it is to have a marginal tax rate of 49½ per cent. But the member for Jagajaga quite correctly asked the Prime Minister about women in particular on $50,000, who, as a result of this Prime Minister and this Treasurer's decisions and policies and as a result of their budget, will have an effective marginal tax rate of 100 per cent. The Prime Minister clearly had not worked this out at question time. He had no idea, not the foggiest idea did the poor old Prime Minister have. It was his budget and he clearly simply did not understand. I will tell you what: 100 is a bigger number than 49½. And an effective marginal tax rate is a problem if you are talking about incentives to work. So this government, if they are fair dinkum, will go back and review their policies and fix that effective marginal tax rate. But I do not like our chances, because these are women on $50,000 and they just do not cut the mustard when it comes to the priorities of this Prime Minister and this Treasurer.

So here we have this government that comes in here and says, 'Let's have a debate about tax', and we say, 'You betcha! You betcha, we will have a debate about tax.' While we are at it we will have a debate about your $65 billion worth of corporate tax cuts. They say they cannot afford $22 billion for schools. They could not possibly afford that. But $65 billion for a corporate tax cut? No worries! 'Where do we sign?' say government members opposite. It is completely unfunded and completely unaffordable.

This government has its priorities wrong. On 1 July they are happy to see penalty rates cut. On 1 July they are happy to see workers who work on a Sunday go backwards, losing money, losing their pay for working on Sundays. This government is happy to see it happen, just as they are happy to see millionaires get a tax cut. That says it all about the values of this government. They are values which are wrong, twisted and not right for Australia's future.

Michael Sukkar (Deakin, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

What an extraordinary MPI! I say to the shadow Treasurer: yes, we have different priorities on tax to you. Yes, we are not the party of higher taxing, higher spending and bigger deficits. We are not the party that believes that people who are earning $87,001 should be treated as millionaires, as this litany of ridiculous questions in question time prove. We do not believe that small businesses with a turnover of between $2 million and $10 million should be taxed and treated like Google or Apple. Every time they talk about multinational tax, with reference to small businesses between $2 million and $10 million turnover—no, we do not believe that they should be treated like Apple and Google.

So we have very different priorities on tax. I say to the shadow Treasurer, the failed former immigration minister, the failed former Treasurer with his Bowen's black hole of $18 billion—go to the next election with a commitment to raise personal income taxes, and make those arguments. Keep arguing that 49.5 per cent is apparently a very low and generous tax rate bestowed on Australian income-earners by the shadow Treasurer. You keep making those arguments; we are the party of small business and lower taxes, so our priorities are very different.

We are also the party of integrity in our tax system. We are a party, unlike the shadow Treasurer, that will impose the bank levy, which will raise $6.4 billion over the forward estimates. No matter how many ridiculous arguments the shadow Treasurer raises, it will raise that money. The attacks on Treasury in that regard have been disgusting. But we will ensure integrity in our tax system. We will ensure that banks, who enjoy a place in our system with the four pillars bank policy, with a regulatory regime which is really the envy of the rest of the world in a financial services context, that they pay a little bit more to contribute to budget repair. We have the shadow Treasurer and the opposition leader, who come in here every single day parroting the lines of the big banks. They were all hairy-chested in here for months, talking about a banking royal commission, and now that we are trying to get a fair additional contribution out of our large banks to assist with budget repair, to assist in guaranteeing the services that Australians deserve, we have the shadow Treasurer and the Leader of the Opposition parroting these ridiculous lines that the big banks have presumably put them up to say in this place.

Also on integrity, we believe in lower taxes, of course, but we also do not believe in a self-help system. We think there must be integrity in our tax system. That is why it is quite extraordinary that last year, led by the shadow Assistant Treasurer here, the Labor Party voted against laws which improved multinational tax avoidance in this country. Just this week, in Senate estimates, it was confirmed that an additional $2 billion has been raised in connection with the multinational tax avoidance legislation that the Labor Party voted against. In Senate estimates it was confirmed that there was a direct connection between raising that money and the change in law.

Unlike the Labor Party, we do not believe that rhetoric, trying to bash Apple and Google in this House, and voting against laws, the toughest anti-avoidance laws seen in the OECD, is consistent with that approach. So we will continue to advocate for lower taxes, but not a self-help system—taxes where there is integrity and where every single company, from the small milk bar to Apple and Google are paying a fair contribution of tax in this country.

But the biggest disgrace of the Labor Party's approach on tax is their approach to small business—their callous disregard of small business. Do the Labor Party realise that there are literally tens of thousands of businesses in this country with a turnover of between $2 million and $10 million who should not be treated like Apple, Google, BHP Billiton or Rio Tinto? These are businesses where every single dollar in tax that they save gets reinvested into the business, gets reinvested into employing more workers and gets reinvested into increasing salaries for their workers. For so many small businesses, it is like a family.

In recent years we have seen that small businesses have been the engine room of growth in jobs in this country—the absolute engine room of growth. So, when members of the Labor Party go to their electorates, they should go into those cafes and small businesses with one or two employees and tell them that they do not deserve a tax cut. Tell them that they should be treated like some big, evil multinational—as the Labor Party would say. Go into those small businesses and tell them, 'You don't deserve access to the instant asset write-off'—the $20,000 instant write-off that will now be available to businesses with a turnover of between $2 million and $10 million. You go and tell them that they do not deserve that. I can tell you right now that there are businesses with one or two employees who will have a turnover of over $2 million. And, according to the Labor Party and according to the shadow Treasurer, they should be treated like large businesses. We disagree.

Perhaps the reason we disagree is that on this side of the House we have people who have come out of small businesses. Perhaps it is because we have people on this side of the House who have actually stumped up their own hard-earned—who have perhaps taken out a mortgage against their own family home to take a risk, to be entrepreneurial—to set up a small business, and they know that every single dollar of tax that they save goes to strengthen their business, and we see the benefits throughout the economy by assisting small businesses in that way.

That is perhaps the most tawdry aspect of the Labor Party's approach—that they would deny tax cuts to small businesses with a turnover of between $2 million and $10 million, not only on the headline company tax rate but also the access to the small asset write-off. It is an absolute disgrace. I repeat: we on this side of the House have very different priorities from the Labor Party. We do not think it is appropriate that, for every additional dollar that somebody earns, one dollar should go to the government and one dollar should go to yourself. We do not think that you should work one day for the government and one day for yourself. We believe that, in order to incentivise people to work harder, to strive harder, to do more and to provide for their own families—

Dr Leigh interjecting—

It is not our money to tax; we do not have a God-given right to tax their money. I know the Labor Party think that. We believe that it is their money and we do not want to disincentivise people from doing what they need to do to get ahead.

Dr Leigh interjecting—

I will not take that interjection from the shadow Assistant Treasurer; I will continue.

Mark Coulton (Parkes, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Fenner will cease interjecting; otherwise his colleagues will need to find the next speaker.

Michael Sukkar (Deakin, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

Our approach is lower corporate income tax rates, lower taxes for small business, lower personal income tax rates, and allowing small businesses to access all of the benefits that this government wants to provide them in the instant asset threshold. Importantly, we are a government that believes in integrity in our tax system—not coming in here all hairy chested talking about Apple and Google and then voting against the legislation. What weaklings, to vote against the legislation that raised an additional $2 billion—$2 billion, additional, that we saw, in Senate estimates this week, was directly linked to the passage of that legislation.

It is surprising that, as to that legislation, the Greens showed more economic rationality than the Labor Party. But I suppose that that just indicates how far to the left the Labor Party has gone. I would say to those sensible members of the Labor Party: take back your party, because you are now the party of high personal income tax and high corporate income tax. And I would say: take that to the next election, shadow assistant Treasurer. Take that to the next election—tax increases for every single Australian—and I know which way the Australian people will answer.

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

Last week we saw an orgy of self-congratulation as the Liberal Party of Australia recognised the 75th anniversary of Robert Menzies's 'The forgotten people' speech. But, sadly, those opposite appear to have forgotten to read the speech, because in that speech the founder of their party says: 'The rich can look after themselves.' Those that Sir Robert Menzies was concerned about were 'salary-earners, shopkeepers, skilled artisans, professional men and women, farmers and so on.' They have forgotten the forgotten people speech.

I do not have time today to refer to issues such as the fact that the party that once talked about homeownership is now the party of housing investors or that the party of schools and universities is now the party that brings down a budget cutting them. Let us just look at how Robert Menzies's forgotten people are being treated under the tax plans of those opposite. A member of parliament, who, according to the tax office's most recent statistics, earns an average of $215,000, will receive a $700 tax cut, but a flower-grower on $32,540 will receive a $162 tax rise. A cardiologist on $408,000 receives a $4,571 tax cut, but a fitness centre manager on $50,500 receives a $252 tax rise. A gastroenterologist on $380,000 receives a $4,000 tax cut, but a kindergarten teacher on $47,000 gets a $230 tax rise. A surgeon on $330,000 receives a $3,000 tax cut, but a nurse on $44,000 gets a $220 tax rise. While a magistrate on $250,000 receives a $1,400 tax cut, a hospital pharmacist on $68,000 gets a $344 tax rise.

And there are those who claim that this is progressive. It is anything but. The Medicare levy is a flat tax. When you ask a hairdresser and a surgeon to each pay 0.5 per cent of their income, that is a flat tax. And Senator Scott Ryan—who has, in the past, thundered that this measure is 'highly progressive'—is dead wrong.

Labor wants to retain the deficit levy because the deficit has increased tenfold and debt has increased by nearly $4,000 per person since the coalition came to office. More than nine-tenths of this—the maintained deficit levy—will be paid by the top one per cent of adults, a group that has seen a doubling in their share of national income over the last generation. With inequality at a 75 year high, it just is not fair to be raising taxes on average workers and cutting them on millionaires. Over the medium term, Labor's proposals raise more than that of the coalition.

We heard this morning from the Prime Minister at CEDA that he is concerned about work disincentives. Well, if he was, he would not be concerned primarily about the work disincentives for the top two per cent, a group primarily comprised of men. He would be worried about the 10 million people that Labor is shielding from paying his increased Medicare levy. And he would be worried, too, about effective marginal tax rates.

Helpfully, a report from the Australian National University prepared by David Ingles and David Plunkett goes through some of these effective marginal tax rates. For someone on a single disability support pension earning between $10,000 and $50,000, they are paying effective marginal tax rates of up to 80 per cent. For a couple with children in child care earning between $5,000 and $50,000, they are paying effective marginal tax rates between 60 per cent and 120 per cent. For an age pensioner couple earning between $20,000 and $80,000, they have effective marginal tax rates from 70 to 90 per cent. For a single person on the Newstart allowance earning between $10,000 and $25,000, they have effective marginal tax rates from 50 per cent to 100 per cent. The work disincentives are real. There are many Australians paying effective marginal tax rates of between 50 per cent and 120 per cent. Because this coalition government axed the women's budget statement, we do not have the sort of analysis that we had for 30 years. Women are going to pay higher taxes under the coalition. The women's budget statement, if it still existed, would have clearly demonstrated that.

Julian Hill (Bruce, Australian Labor Party) Share this | Link to this | Hansard source

Ask all the women over there!

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

I remind the member for Bruce again that warnings do carry over.

Ted O'Brien (Fairfax, Liberal Party) Share this | Link to this | Hansard source

I am delighted that the member for Fenner has finally read the Forgotten People speech. I am sure he is recommending it to his colleagues, for at the end of the day what Robert Menzies stood for, what he fought for, and what the Liberal Party continues to fight for with its coalition colleagues in the National Party, the former Country Party, is to ensure that small business is looked after, to ensure that the small people in Australia are looked after.

Yet the Labor Party, who purport to represent the workers, go against its very principles. The Labor Party are in the game of getting anything they can get their hands on. The Labor Party wish to tax the everyday household with higher electricity prices, evidenced by their 50 per cent come 100 per cent target with renewables. Labor are happy to tax the household. Labor are happy to tax the unemployed by denying them opportunities for work. By ensuring that major international investments such as the Adani project are thwarted, they are by default taxing the unemployed, denying them opportunities for work. The Galilee Basin alone is offering 15,000 jobs, yet the Labor Party are not interested in that, because they are happy to tax the unemployed. They are more than happy to tax the mum and dad investor, with a negative gearing plan that ensures that you cannot offset against personal income. They are more than happy to have the wealthy on investments, but not mum and dad investors. So the Labor Party are also happy to tax mum and dad investors.

The Labor Party have made it very clear that they will change the existing legislation to hike taxes up for small businesses. So, for any business out there which has a threshold below $50 million a year in turnover, the Labor Party has already guaranteed they will increase company tax rates. By imposing and continuing to prosecute the case against the coalition's Enterprise Tax Plan, the Labor Party are guaranteeing they will increase taxes for small and medium businesses. These are 3.2 million businesses across the country, employing 6½ million Australians. The Labor Party are saying that their priority with tax is to ensure they are paying more. We know what happens with small businesses when they have to pay more tax: there is less opportunity for them to create more jobs. This is what the Labor Party represent today. They are more than happy to tax people's take-home pay and they are more than happy to oppose multinationals paying more tax.

Here we have a situation, in this very term of government, in which the Labor Party has opposed a major instrument from the government to ensure that multinationals cannot avoid tax. Already in this financial year we are going to see $2 billion of tax clawed back to the Commonwealth government. That is tax that otherwise would have been avoided by multinationals. So, the Labor Party, who purport to represent the worker, are more than happy to stand there with all their rhetoric but when push comes to shove they stand for multinationals above small businesses. How does that make sense?

Instead what we have from the Turnbull government is a government that is prepared to ensure an extension of the $20,000 instant asset write-off, a government that is prepared to reduce company tax, a government that is prepared to ensure that we are more competitive in the international economy so that we can attract capital. Attracting capital creates jobs, and that is what this government does. The opposition stands for nothing but taxing everything in sight and looking after the union movement, looking after the multinationals and leaving behind the people Menzies and the coalition stand for—'The Forgotten People', and I am delighted, again, that those opposite are starting to read that speech.

Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Link to this | Hansard source

I am very pleased to speak today on this MPI on the government's tax priorities, and I thank my colleague for putting it on the agenda. The other side has a problem, and it is a stench around this budget that is lingering from 2014. In 2014 the smell of unfairness in the budget created such a backlash in the community that the government is now trying to pedal away from it. The problem they have is that there is the same smell in this budget, and it is a smell of unfairness. And I can guarantee to those opposite that if there is one thing the Australian population are really good at it is sniffing out unfairness, and they can sniff it very clearly in this budget.

The government is attempting to, if you like, Air Wick over that smell. How are they doing that? First of all, they are trying to make out that somehow they have had a road-to-Damascus conversion on the delivery of services—in particular, things like health and education. You can imagine the discussion in the lead-up to budget night: 'Let's work out the bare minimum we can do to try to say we are doing something about these issues and change the conversation, because we know we're suffering politically because of it.' So, they introduce a proposed Gonski 2.0, which is not only a $22 billion cut on what was promised in the first version but a structurally different funding proposal. At its heart, it is unfair to the vast majority of Australians. And you can see that because of all of those who are out there raising their concerns and campaigning against it, as recently—as my colleague the member for Whitlam would know, as we share an area where the New South Wales parliamentary secretary for education is very active—as when the New South Wales Minister for Education, a Liberal minister, in case it has escaped anybody's notice, shortly before question time was out there jointly with the Labor shadow minister, the Greens spokesperson and the Teachers Federation saying: 'This is a dud deal for New South Wales and the kids I represent. Give us back the money you cut.' That is what your New South Wales Liberal minister said before you came back into this place.

Mr Rick Wilson interjecting—

The member wants to know whether I will back what they say on education. Yes, I will. And we have said that publicly, because they are right: you are cutting from every one of their schools. And if you are worried about what we are saying, I would suggest that you be more worried about what your New South Wales Liberal colleagues are saying on this Gonski hoax.

Secondly, on health: 'Let's say we are winding back the freeze—except we will just extend it for so long, and then, as we've subsequently discovered, we'll cover as minimal a number of Medicare items as we can', so that, as my colleague indicated, a significant number of people in life-threatening circumstances are not going to see the freeze wound back for years. It stinks and the general public know it. That is why they are having so much trouble with it.

The second Air Wick tactic they are rolling out with this budget is to launch a personal attack to get stuck into the Leader of the Opposition about what his position is on issues such as the NDIS. I have to say that I think it is disgraceful of the Prime Minister to stand at the dispatch box and attack the Leader of the Opposition for having a debate about how we fund the NDIS and to use that to question and to accuse him of not caring about people with a disability. Mr Speaker, you can tell when the Prime Minister is panicked because he goes way down the low road. I would suggest he does not do it naturally, and therefore not very effectively. He is going to grab that stick every time he can because he is in panic about his own leadership.

So we get an attack from the person who is now the Prime Minister, saying to the Leader of the Opposition, 'What do you stand for?' You have got to be kidding me. This Prime Minister is struggling in the polls because nobody knows what he stands for. Gone is the leather jacket. Gone is his commitment to same-sex marriage. Gone is the idea, 'I won't lead a government that doesn't take strong action on climate change.' If anybody has a problem with consistency it is this Prime Minister. I would suggest to him, as much as he wants to go on the low road and attack the Leader of the Opposition, he ought to look in the mirror first because he has no legitimacy on that. This is a dud budget. It smells and the people of Australia know it.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

Isn't it ironic that the member for McMahon is in here again, spouting about unfair taxes. I am sure he knows more about unfair taxes than any other member of this parliament—maybe the member for Lilley knows about them as well. 'Taxes, taxes and more taxes' is a phrase I am almost certain headlines the Labor Party's national platform and constitution.

We sure did see some unfair taxes during those haunting Rudd-Gillard-Rudd years. I am sure those on the other side have a very short memory when it comes to unfair taxes. Those are years tainted by exactly what the shadow Treasurer is claiming yet again here in the chamber. Perhaps he has forgotten it is 2017 and those days are behind. Perhaps he has wiped them from his memory. We can all breathe a sigh of relief that the government is now in the hands of the coalition, who have continued to deliver on our priorities and deliver on our promises.

It is the Labor Party that on one hand will tell the Australian people they support the bank levy, but then seem to walk in here every day spouting the big lines from the big banks and what Anna Bligh seems to give them the night before so they can stop the levy. In fact, Labor never seemed to support the concept of fairness; they simply supported whatever made the big business and union monies flow into their election campaigns, all the while telling everyday Australians that they were standing up for them.

I would like to take the House and members present on a brief walk down memory lane with regard to unfair taxes, particularly those imposed by those opposite when they were in government—

Mr Rick Wilson interjecting—

And their anti-Western Australian taxes. I see the member for O'Connor, from Western Australia. Let's start with the mining tax. We all remember what the mining tax did to the Western Australian economy. If we look back, it started its early phases with the minerals resource rent tax. It passed the House on 23 November 2011 and passed the Senate on 19 March 2012. Mr Speaker, can you believe a total of $22.5 billion was expected or proposed by those on that side to have been raised over the first four years of the tax, to be spent on pensions, tax cuts for small businesses—which went into the ether and they blamed us for that when it was their own fault—and infrastructure projects. There was a promise of $100 million to the Western Australian economy which never materialised either. In the May 2012 budget, the government said this tax would bring in $3 billion for the financial year. In October 2012, that figure was reduced to $2 billion. On 14 May 2013, it was announced that the receipts were expected to be—can you guess, member for O'Connor?—from $22.5 billion down to less than $200 million. How successful was that unfair tax that was imposed on the Western Australian economy and the Queensland economy by those opposite while they were in government?

Mr Perrett interjecting—

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

The member for Moreton has been warned! He is unlucky; I am in the chair.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

They seem to forget that they were imposing unfair taxes and they now sit there, claiming credibility that they are the greatest economic managers the world has ever seen. Still paying back the prepayments of the taxes with regard to the mining taxes is what we are doing. The tax also proved to be complex and expensive to operate. It cost more than $50 million to set up, with estimated running costs of $20 million a year, and advertising came to nearly $40 million. And we cannot forget that other tax which was anti Western Australia, the carbon tax. Again, this was a very unfair tax and we got rid of it. When the coalition came into government we got rid of those unfair taxes that everyone in Australia knew were unfair. Yet, here they are telling us we are imposing unfair taxes.

It is the coalition government that is securing our nation's future. We are the government that has delivered a budget that secures the essential services that Australian's rely on, a budget that delivers fairness in ensuring our education and disability services are paid for, and a budget that is supporting economic growth and generating opportunities. I would like to run through some of the ways this government is doing just that. In fact, just today this House is debating our decision to extend the $20,000 instant asset write-off for small businesses by 12 months. We will also pass tax cuts for businesses with turnovers of up to $50 million, legislating the entirety of the small- and medium-business tax cut we promised to deliver under our Enterprise Tax Plan. This effectively allows businesses to grow, invest and employ more Australians, which I am sure every person in this House would support. Our tax cuts will affect 3.2 million small and medium Aussie businesses. If anyone can call that an unfair tax or say that it is imposing taxes on the business sector, they are getting it totally wrong.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

It is nice to follow the member for Swan, and I want to return to one of the things he said in his speech. He said that this budget—the Turnbull government's budget—is all about delivering on the coalition's promises. It is not delivering on that promise of no new taxes—the promise of no new taxes that was delivered by the member for Warringah, the banker of the backbench, right before the 2013 election. Instead, we have a budget that Treasurer Morrison has delivered that is going to basically ask hardworking people to pay for a $60 billion tax giveaway for big business.

I remember when the deficit levy came in—the temporary levy, as it is now called by those opposite. They call it the temporary levy, forgetting that its title is actually the deficit levy. They are saying: 'We can't change anything, because it's got the word temporary in front of it. Therefore, we have to give all these millionaires a tax break from 1 July, in 30 days time.' But, really, it was all about fixing the deficit. We still have a deficit. In fact, the deficit is even worse than the one delivered by smoking Joe Hockey in his 2014 budget. It is actually 10 times worse. How can it be fair to cut the tax of high-income earners from 1 July while at the same time increase the tax for low- and middle-income earners—in fact for 10 million Australians. The member for Swan did not mention that in his speech, I note. It is unfair to cut the take-home pay of 700,000 shift workers by up to $77 a week. These are the people who need it most, but, instead that is what the government has made a priority.

These scenarios are not scenes from a tin-pot dictatorship; this is Australia, under the Turnbull government, announcing this in its budget three weeks ago. It is an inherently unfair budget. Even though the Treasurer mentioned the words fair, fairer and fairness 10 times during his speech, we know what his approach to 'fair' really is. He is all thesaurus and no heart when it comes to fairness. This government is so out of touch. The deficit is out of control under them, and we are about to have a coalition government start its fifth year in office. There comes a time when you have to say, 'We are in control of where the ship is located.' Eventually, the bridge of the ship of state has to be grabbed by the coalition. I know they govern like they are in opposition, but the reality is they are about to start their fifth year.

We know that budgets are always about choices, and haven't we seen the Turnbull government's values crystallise in this 2017 budget?

What have we seen? They are looking after big corporations, including foreign corporations, and conglomerates, the millionaires and billionaires. This is fundamentally unfair and, dare I say, unAustralian. It is unAustralian if you are going to be attacking working Australians—10 million of them—at a time when the real wages of Australians have actually gone backwards. We have had the lowest annual wages growth on record since the ABS first published data in 1997. We have real increases of 1.9 per cent, not enough to actually cope with the cost-of-living increases.

So, if you earn $60,000 a year, you will be paying an extra $300 in tax; but, if you earn a million dollars, you get to pay $16,400 less—not more; less. That might sound fair in Point Piper, but I can tell you it sounds fundamentally unfair in Sherwood, in Fairfield, in Oxley, in Meruka, in Coopers Plains and in Runcorn. The reason millionaires will be paying less is that this government says, 'No, we can't continue this deficit levy, even though the deficit has skyrocketed under this government.' Remember that? Finance minister Senator Cormann said that the levy would 'ensure higher income Australians contribute to the budget repair'. Well, the budget still needs to be repaired. As I said, the deficit is actually almost 10 times worse than the one handed down by Joe Hockey. It is ridiculous.

David Coleman (Banks, Liberal Party) Share this | Link to this | Hansard source

I cannot believe that those opposite have actually chosen to discuss the issue of tax for today's MPI. As I understand it, the idea of the MPI is for oppositions to raise issues that are favourable to them. And, on tax, the opposition's policies are absolutely appalling. There are so many examples to run through it is a very odd strategic choice. I know the shadow Treasurer has had a rough few weeks; he has been fluffing around on the bank tax, effectively running the lines of the banks and really failing to make any headway there. Maybe he has said, 'Look, we'll have the MPI about tax; it'll be really good for us.' But that was a really bad calculation, because the Labor Party's policies on tax are appalling.

One of my personal favourites of Labor's appalling policies is their extraordinary policy on capital gains tax. You will recall they said that, because of the housing affordability issues in Sydney and Melbourne, they want to raise capital gains tax by 50 per cent on everything. So the Labor Party, those opposite, propose to increase capital gains tax by 50 per cent on everything—not just housing investment, but also investment in farms, investment in factories, investment in cafes. They want to increase tax on all of those investments by 50 per cent because of issues to do with housing affordability in Sydney and Melbourne. That is an extraordinarily stupid policy and the impact of it would be to reduce investment. That is the last thing we want. What we want is more investment, particularly in small and medium businesses.

So we say, let's reduce the rate of company tax for small to medium businesses from 30 per cent to 25 per cent and, happily, the Senate agreed. The Senate, to its credit, supported that legislation. But what those opposite say is: 'No. That is bad legislation and it should not be allowed to occur for businesses with turnover of more than $2 million.' What that means—and this is very clear—is that those opposite are advocating a $30 billion tax increase on small to medium businesses in Australia. If my characterisation of that is not right, I would welcome any of the members on the opposition benches to say so, or perhaps the shadow Treasurer could come into the chamber and say that that is not the case and the opposition will not be increasing tax on small to medium business by $30 billion if elected. But he will not do that, because that is their policy. You cannot oppose a tax decrease without supporting a tax increase, and that is what they do.

They also think that businesses with more than $2 million of revenue are not small. I think a lot of them over there do not understand the difference between revenue and profit. Of course, there might be a business with revenue of, say, $2 million but its profit margin might be three or four per cent. There are a lot of small businesses with very small profit margins. So that business with $2 million of turnover might in fact be making $100,000 or less. It might be making the average wage.

Labor says that is a vast corporation which must be treated in a different way to small businesses and, as a consequence, should not be allowed to claim the $20,000 instant asset write-off. That is just an absurd policy, because plainly those small businesses of between $2 million and $10 million need that support. It is a very effective policy, the instant asset write-off. It encourages investment in local communities and those opposite say it is a bad idea, again betraying their lack of understanding in this area.

We also know that they oppose the government's sensible measure to fully fund the NDIS through an increase in the Medicare levy. They left us with this $55 billion hole in the NDIS system. They say that if someone is earning $85,000 they should not be asked to contribute to the National Disability Insurance Scheme funding, but if someone is earning $87,000 they should. So someone earning $87,000 is apparently rich and able to contribute and someone earning $85,000 or $86,000 is not. That is an absurd policy; it makes no sense at all. It is entirely appropriate for all Australians to contribute.

We know, of course, about their failure on the multinational tax legislation, where they shamefully voted against the legislation which the government has passed and which has already raised more than $2 billion. So it was a very bad choice to raise this issue as it is of great vulnerability for the opposition and a great strength for the government. (Time expired)

Susan Lamb (Longman, Australian Labor Party) Share this | Link to this | Hansard source

We have all heard members on the right claim that they are all for lower taxes. Their advertising often uses this as a single-minded proposition. In their latest budget, handed down recently by the Treasurer of course, that is absolutely what they did—but only for the highest-income earners. For everyone else—for the true, ordinary hardworking Australians—guess what? They are getting a tax hike.

This is clearly a budget that is designed to make the rich richer and the poor poorer. It is what can only be described as a simple-minded proposition. This is an unfair budget, not a fair budget. This is a budget that makes life harder for ordinary Australians and it could not come at a worse time. It comes at a time when the latest ABS figures show that wage growth is at its lowest-ever levels—1.9 per cent wages growth. It comes at a time when the general cost of living is increasing by 2.1 per cent. So there is low wages growth of 1.9 per cent and the cost of living is 2.1 per cent. It does not take much to do the maths there, does it?

And it comes at a time when this government makes a cruel and senseless attack on workers by cutting the take-home pay of 700,000 Australians. Come 1 July a retail worker earning $60,000 a year could have their pay cut by up to $77 a week, thanks to this government's slashing their hard-earned penalty rates. And due to this very careless budget, not only will they get an extra $77 pay cut a week—

Mr Pasin interjecting—

they will get an extra $300 in taxes under your government—under your government! At the very same time as they are getting slugged an extra $300 a week, a millionaire will be getting a tax cut of $16,400.

Michael Sukkar (Deakin, Liberal Party, Assistant Minister to the Treasurer) Share this | Link to this | Hansard source

It's rude to point!

Susan Lamb (Longman, Australian Labor Party) Share this | Link to this | Hansard source

Let me tell you, there are not too many millionaires in my electorate. I would like to know how anybody could even consider this as fair. How could anyone consider this budget, that is seeing every single Australian who earns less than $180,000 a year worse off, fair?

Instead of making life easier for people who are really struggling to get by, this Prime Minister decided to attack them with $21 billion in taxes—$21 billion! Instead, he is letting money flow overseas, with a huge $65 billion tax cut to big business. Instead, he is lining the pockets of millionaires with over $16,000 a year—$16,000! Let me tell you what $16,000 is in my electorate: that is 60 per cent of the median personal income of the people in Longman—$16,000.

One thing Australians know is where their Prime Minister's priorities lie. They lie with the rich and the wealthy, and so do the other members of this government. We cannot go too hard at all on this Prime Minister, because I do not think he knows any better. I do not think he has ever had to struggle to pay and go without a meal. If he has, I would like to hear about it. I do not think he has ever had to wonder about being able to afford to pay his rent. I wonder whether he has ever done that. I think people would expect our Prime Minister to listen to them, to find out what is going on, to try and understand how tough life can be on the other side of the coin, when you cannot afford to pay your rent and you cannot afford food.

Instead, people know who has their ear, and that is us—the Labor Party. We are listening to people, because when you listen you hear things.

Mr Pasin interjecting—

Member for Barker, you might be well advised to take some advice there. When you listen you hear things. We are hearing that people are saying they do not want the Turnbull government to give huge tax cuts to big businesses. That is what people are telling us. They should be paying their fair share—that is what people are telling us. On this side of the chamber what we hear is that Australian people know that this is an unfair budget. It is riddled with unfair priorities and it does nothing to further increase income equality in Australia. I can tell you that not once have I been stopped in the main street of Caboolture by someone who said, 'Please give my bank more money. Please make sure that they get a tax cut.' Not once! But let me tell you that the 85,000 people in Longman earning less than $52,000 a year need a break.

Tony Pasin (Barker, Liberal Party) Share this | Link to this | Hansard source

I think the member for Longman has got a little bit confused in this debate. She said that people in her community, Caboolture, do not want her to give banks a tax cut. What she needs to do is speak to the member for McMahon, because he comes in here, day in day out, arguing the case on behalf of the big banks, saying, 'No, no, no! We can't afford a levy. Please don't levy us! We are just humble Australian banks.' It might behove the member for Longman to work out that this government in this budget made a commitment to ask the banks of this country, the five big banks who have been the major beneficiaries of 26 years of unbridled and continuous economic growth, to put a small contribution to the economic welfare of this nation into the community chest. That is our position. She might want to speak to her shadow Treasurer, because he comes in here day after day giving us the banks' lines.

How far the once proud Labor Party has moved from that time under Hawke and Keating, when they were principled and fought the good fight. There is time for governing and there is time for politicking. Unfortunately, what we see on the other side now is this constant barrage of politicking. They have dropped the pretence of fairness in favour of political expediency. If they were truly concerned about what was fair they would look at this budget and say, 'It's a fair cop—you've looked at what has been the needed, you've made some serious concessions, and we'll meet you in the middle. We'll extend a hand over the gap.' They would come to us on things like Gonski and say, 'For a very long time we've been arguing in favour of Gonski. We've been asking you to give a Gonski. In fact you have given a Gonski and we're prepared to meet you in the middle.'

But that is not what we see here. They would be saying that a fair and reasonable way to fund the NDIS is a one-half of one per cent increase to the Medicare levy on all Australians earning above the appropriate threshold. But they do not do that. They come in here and try to engage in the kind of class politics which, quite frankly, denigrates them and runs down this whole place. At one stage they ran a campaign saying that we need to maintain the universality of Medicare. Those of us on this side of the House understand how important the universality of Medicare is. But in the very same breath they say, 'This NDIS, which we want to be great champions of—and, by the way, we didn't fully fund—we only want certain segments of the community to make a contribution for that.' That is running down the concept of universality in this space and it is not fair. And what they do not say in this debate, of course, is that the millionaires they like to speak of would pay a half of one per cent additional levy on their full income; they would be making a disproportionately significant contribution to meeting the needs of everyday ordinary Australians who, sadly, suffer from a disability; or indeed they would be making provision for those who may one day become disabled—and there, but for the grace of God, go I.

In the time I have left, I want to make an observation about small business. There is a constant debate in this place about who is here to represent small business. Well, I do not know whether I represent small businesses but I come from a family who runs small businesses and I have run a small business in partnership with my wife. The member for Longman said that some on the other side do not know what it is like to go without. Well, let me tell you, in my small business there were times where I went without because I had to make sure the wages were paid. I want to remind those on the other side about the instant asset write-off. This is an opportunity that we have extended—and I am glad we have.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

The time allotted for this discussion has now expired.