Nicolle Flint (Boothby, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Revenue and Financial Services. Will the minister update the House on the importance of pursuing tax policies that support aspirational Australians, including in my electorate of Boothby? Is the minister aware of any threats posed by different approaches?

Kelly O'Dwyer (Higgins, Liberal Party, Minister for Revenue and Financial Services) Share this | Link to this | Hansard source

I thank the member for Boothby for her question. She backs hardworking, aspirational Australians and she does that because she supports a tax system that will see them rewarded for their hard work and effort and will see them able to keep even more of their hard-earned income. Under our government's tax plan, 94 per cent of those people who are out there earning money will pay no more than 32½c in the dollar when our plan is fully implemented.

I have noticed that there are those opposite who love to talk a lot about equity. I know it's not convenient for those opposite, but under the government's plan those who are in the top tax bracket will pay a higher share of taxes than they do now. Yet, when Labor thinks about equity and when they think about retirees, what do they do? They decide instead to implement a mega retiree tax, and it is aimed at precisely those people who can least afford it.

Under their cash grab—and let me just give an example—Joan, a self-funded retiree who earns a very modest $20,000 a year, including $9,800 in cash dividends and $4,200 worth of franking credits from her shares, will see, under their mega retiree tax, every single one of her credits ripped off her. It is courtesy of you-know-who—the Leader of the Opposition. Let's contrast that with William. William is a very high income earner; perhaps he's a union boss. He earns around $250,000 a year. He has exactly the same dividends from holding exactly the same set of shares in the exact same company as Joan does. He gets the exact same franking credits. But is William going to be able to keep those franking credits? Of course he is. He's able to utilise that. This mega retiree tax is not aimed at the top end of town. He does not lose a single thing; whereas Joan loses every single cent.

Mr Keogh interjecting—

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

The member for Burt is warned.

Kelly O'Dwyer (Higgins, Liberal Party, Minister for Revenue and Financial Services) Share this | Link to this | Hansard source

The Leader of the Opposition likes to talk a big game when he talks about equity and the taxation system. He likes to claim that he protects those who are vulnerable and weak, yet he is the one who has his hands in the pockets of all the grandfathers of Australia and he's the one who's got his hand in the handbags of all of the grandmothers in Australia, because he is the one who would hit them with a very high tax. He is the one who would threaten their retirement and their security. He is so shifty. He cannot be trusted and the Australian people know better.

Michelle Rowland (Greenway, Australian Labor Party, Shadow Minister for Communications) Share this | Link to this | Hansard source

My question is to the Prime Minister. Can this arrogant and out-of-touch Prime Minister confirm that under his tax scheme a telco executive from Sydney's upper North Shore earning a million dollars a year gets a tax cut of over $7,000 but a shop assistant from Western Sydney selling phone plans gets a tax cut of just $10 a week? Is this why the Prime Minister is telling working Australians who are doing it tough to just 'get a better job'?

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The tax relief depends on a person's income and, indeed, it would apply to a lawyer working for a large telco as well. They're well paid as well. What the honourable member is trying to argue is that the tax in personal income tax reform is lacking in equity. Yet, under our plan, by 2024-25, not only will 94 per cent of Australians pay no more than 32½c on every dollar—any dollar they earn—over $41,000 until they get to $200,000 when the 45c tax rate comes in, but taxpayers earning over $200,000, paying 45c tax, plus of course the Medicare levy, will constitute a larger share of the overall number of taxpayers and a substantially larger share of the total personal income tax receipts.

All of those people—all of those police sergeants and police inspectors, all of those headmistresses and headmasters of schools around the country, that are earning incomes around that level, as they will be by 2024-25—earning above $125,000, some of them over $200,000, will be contributing more of the tax take than they are today. On any test, our reform is fair. It results in a flatter income tax system that encourages aspiration and incentive and enterprise, and that's the big difference. We are inspired by the aspiration of Australians; the Labor Party is mystified by it.