Helen Polley (Tasmania, Australian Labor Party) Share this | Hansard source

I rise in the Senate on this occasion to comment on the Tax Laws Amendment (Luxury Car Tax) Bill 2008 and related bills that comprise the government’s budget measures on the luxury car tax. The increase in the luxury car tax was announced in the 2008-09 budget as part of a package of measures to enhance fairness in the tax system. This measure will create an estimated $130 million in revenue for the government in this financial year and $555 million over the forward estimates. It is estimated that around 10 per cent of all new car sales made in Australia in 2007 were subject to the luxury car tax.

The Rudd Labor government believes that Australians who can afford luxury vehicles have the capacity to contribute to the revenue at a higher rate than other car buyers. The Australian people understand that the Rudd Labor government is acting now for Australia’s long-term future. We are preparing Australia for a stronger future, in contrast to the Liberal Party. We witness in this chamber regularly how divided they are on so many issues. They simply do not have the long-term leadership that Australia needs. They need a reality check.

The Rudd Labor government is making sure our economy emerges in strong shape from these tough international times so that we can provide quality jobs and security for working families in the future. The Liberal Party neglected the big long-term challenges Australia faces, such as climate change, our hospitals, our schools and our infrastructure. They foolishly ignored 20 Reserve Bank warnings on inflation.

It is pleasing to note that yesterday the Reserve Bank actually cut interest rates. This was a decision that working families deserved. I am sure it was applauded by families who are doing it tough. For the average mortgage, yesterday’s cut will put more than $500 a year back into the family budget—and, for many Australians, much more than that. This is some initial relief from the 10 interest rate rises that occurred under Peter Costello and the Liberal-National coalition which have cost Australian families on an average mortgage $400 every month. This is the first time families have had a rate cut from the Reserve Bank in seven years.