Mathias Cormann (WA, Liberal Party, Shadow Assistant Treasurer) Share this | Hansard source

Yes, whatever tax you name, Senator Parry, you are quite right. The ingenuity and creativity of the government to come up with new taxes knows no end. Why did the government not wait until budget time? Why did they come up with this legislation now? Why did they announce it so quickly? It is because there is one thing that drives this government: the politics of getting away with introducing yet another tax.

This government is addicted to new taxes, but it also knows that taxes are unpopular. It knows that the Australian people have a lot of goodwill and generosity towards the people of Queensland and the reconstruction effort. This government thought that it would take advantage of that. This government thought it would strike while the iron is hot. This government thought there was no better time than the present to come up with a new tax: ‘This is the time to come up with the tax because people across Australia will let us get away with it. Let’s call it a flood levy. Let’s call it a mateship tax. Let’s give it a nice cuddly name and people will be happy about it.’ But, of course, the Australian people are not that stupid. They can see through this government. They have seen it again and again. When they were given supposedly high moral ground reasons to introduce another tax—Madam Acting Deputy President, you would well remember the alcopops tax, which was supposed to reduce binge drinking, which was supposed to reduce the consumption of alcopops at the same time that Treasury was counting on an increase in the consumption of alcopops. That is the sort of dishonest track record this government has when it comes to taxes: it sees an opportunity to get away with a new tax and goes through with it. That is what happens with this government.

The reality is that, in the face of tragedy, Australians had been donating generously. When Australians witness a tragedy like the one in Queensland, people are very generous and Australians have dug deep. But, after they have dug deep, in comes the government and whacks them with this tax. What do you think will happen when the next disaster comes around the corner, as it sadly but inevitably will? Do you think the Australian people will be a bit more circumspect, a bit more cautious, before they spend as much as they can possibly afford to support their fellow Australians in a time of need? Yes, because they will expect that this government will do as it has done before and whack them with yet another so-called emergency tax, a so-called mateship tax.

The government, supposedly, had made a whole series of savings, but, of course, hundreds of millions of dollars of those savings were reversed to get the vote of the Greens, Mr Wilkie and Senator Fielding. They have not yet got the vote of Senator Xenophon, as I understand it. They have been spending money left, right and centre, reversing savings and reversing spending cuts. Have the government identified any new, alternative spending cuts? No, they have not. So what did they say to us when we asked, ‘What’s going to happen?’ They said: ‘Wait for the budget. We’re going to organise all of that in the context of the budget.’ If you can organise those spending cuts in the context of the budget, why can you not organise the $1.8 billion worth of spending cuts that would be required in order not to have this tax as an ad hoc tax? Why would you not wait for the budget before proceeding with this? There has been no reasonable explanation for this from anyone in government.

Talking about strategic things, do you remember the Henry tax review, Madam Acting Deputy President? The Henry tax review was supposed to be this root and branch reform of our tax system, delivering a fairer and simpler tax system. The only thing we have ended up with out of that review is a multibillion-dollar new tax which was negotiated in private with three taxpayers, excluding all of their competitors from the process as well as the state and territory governments and all other stakeholders and the public at large. After the Prime Minister nearly lost the election but was saved by Mr Oakeshott and Mr Windsor, we were told that we were going to have a fair dinkum tax summit by 30 June 2011. We were told that, at that tax summit, the government would throw open all the recommendations of the Henry tax review and that there would be a strategic look at the taxation arrangements in this country, not this continuation of ad hoc tax grabs one after the other but a strategic look at what the taxation arrangements in the context of the spending commitments for Australia would need to be.

Is that going to happen? No. The promise very quickly made by the Prime Minister when she was desperate to get support to form a minority Labor government is about to be broken. The Treasury secretary, Ken Henry, let the cat out of the bag. I do not think he quite knew what he was doing when he quoted the Prime Minister as saying that it would not be happening before 30 June. But, of course, we have been hearing similar rumours. The Treasurer, Wayne Swan, does not want to have a strategic look at the tax system. He wants to continue to go ahead with tax grab, after tax grab, after tax grab, like this one, without being bothered by any strategic and serious reform assessment of the taxation needs of Australia. He does not want to be bothered by these sorts of strategic assessments in his pursuit of more and more money for this high-spending, wasteful Labor government.

So here we are with yet another Labor tax grab outside of any strategic context and which, in our judgment, is not in the public interest. In this context I would say to the member for Lyne and the member for New England that they have to realise that, unless they disassociate themselves from these sorts of Labor failures, these failures will also be their failures.

We had a debate in Senate estimates as to whether this was a tax. Senator Sherry was trying to argue this was not a tax. I refer Senator Sherry to the title of this bill which reads ‘income tax rates amendment bill’. What do you think an income tax rates amendment bill is going to do if it is not amending income tax rates? Let me be very clear on this for all Australian people: this is a bill to increase income tax for all Australians earning more than $50,000 unless they are in one of the few exemption areas. There is a lot of confusion about the exemption areas. We looked at the Prime Minister’s press release of 27 January as to who would be exempt. It said:

... anyone who received an Australian Government Disaster Recovery Payment for a flood event in 2010-11 will be exempt from the levy.

And a Treasury fact sheet said those who received an Australian Government Disaster Recovery Payment in relation to a flood event in 2011 would not have to pay the levy. So we asked this question in estimates: what about the victims of the WA bushfires? Don Randall, the very hardworking federal member for Canning, brought this to my attention. He said, ‘You’d better ask some questions about this in estimates,’ so I did. I asked the secretary of the finance department, and what did he say? He confirmed exactly that: only those who were subject to a flood event would not have to pay the levy. We thought that was a matter of public interest as a lot of constituents had approached us on this saying they were very concerned about it.

The West Australian were about to write a story on it so they presumably asked a question of the Prime Minister’s office. This is what the spokesman for Ms Gillard said, ‘Victims of this year’s WA bushfires will be exempted,’ and, ‘As the Prime Minister has made clear, if people have been hard hit by natural disasters in the last few weeks then it is only fair that they do not pay the levy.’ It is very nice for the Prime Minister’s spokesman to say that to a journalist when they are faced with what could be a bad story on the front page of a daily newspaper but to this day they have not actually adjusted the information on the Treasury website or in any of the official information. To this day the website still says that you are only going to be exempt if you were subject to a flood event.

Without wanting to be disrespectful, Prime Minister, we do not trust the word of your spokesman under pressure from a daily newspaper in Western Australia. We want to see that commitment in writing. If it is to be the case that all Australians subject to a natural disaster are going to be exempt, then you should be clarifying this today and you should be adjusting the information on your relevant websites today.

There have been too many broken promises by this Prime Minister for us to take at face value anything that she says particularly if that message is translated by one of her spin doctors in the context of a media story. I want to reflect on the approach taken to this tax by one of our colleagues in the lower house, namely the member for O’Connor. The member for O’Connor was elected on a platform to reverse the Canberra rip-off. It should now be clear to anyone that the people of O’Connor were deceived at the last election. Tony Crook is not here to reverse the rip-off; he is here helping Labor get rip-offs like this one through the parliament.