Kimberley Kitching (Victoria, Australian Labor Party) Share this | Hansard source

Three-quarters of a century ago Robert Menzies made what became a famous speech about Australia's forgotten people. I've been told by some senators across the chamber that they actually enjoy hearing Robert Menzies quotes from me, because they don't hear them on any other occasion. Robert Menzies said that those forgotten people were forgotten because:

… they were not rich enough to look after themselves, but nor did they receive the protection that trade unions gave to the working classes.

That speech not only helped shape politics in the postwar years but also, apparently, is a central tenet of the Liberal Party.

But here we have today, this year, this Prime Minister, this Liberal Prime Minister, from the party of Menzies—the party of one-time lower taxes—who has actually increased taxation on Australians. They have increased the Medicare levy. The increase in the Medicare levy has the greatest impact on individuals in the third, fourth and fifth income quintiles. The second quintile—those earning $21,000 per annum—will also have their tax burden increased: $21,000 and paying more tax under this government. Let me be clear and give some examples. Someone earning $60,000 will pay an extra $300 in tax. Someone earning $80,000 will pay an extra $400. This is a tax hike on over seven million Australian workers earning less than $87,000 each year. Yet this government, this Prime Minister, is going ahead with $65 billion in tax cuts for big business. It's clear that low- and middle-income Australians are paying for the government's $65 billion handout to big business in the form of rising personal income taxes.

Now, those opposite, and Senator Cormann during question time, attempted to rubbish the ALP on some of these figures. But let's go to the Parliamentary Budget Office and the report they put out last July, called 2017-18 budget:medium-term projectionsand I'm sure the Minister for Finance has a copy. This is what they said:

Personal income tax receipts are projected by the PBO to increase by 1.6 per cent of GDP over the medium term, from 11.1 per cent in 2016-17 to 12.6 per cent of GDP in 2027-28.

…   …   …

Once the tax 'cap' is reached, personal income tax receipts are projected by the PBO to continue to rise as a per cent of GDP as company tax receipts decline from 2023-24 as a result of the Government's Enterprise Tax Plan. The PBO projects that the average tax rate on personal income will rise from 22.7 per cent in 2016-17 to 25.9 per cent in 2027-28.

The report states that in 2023-24, personal income tax is 12.4 per cent of GDP while company tax is 4.5. By 2027-28, personal income tax is 12.6 per cent of GDP, while company tax is 4.2 per cent. So from 2023-24 to 2027-28, when the company tax rate is meant to decrease for all companies, personal income taxes rise 0.2 percentage points of GDP while company taxes decrease by 0.3 percentage points. That position was only reinforced by the PBO at the end of last year, where in another report they showed that middle-income earners are set to suffer the greatest tax burden under this government's policies.

What does this mean? First, let's consider how disheartening and frustrating this must be for Australians. What it does show is it's a government with no understanding of the effect that its policies are having on the living standards of lower- and middle-income families, and no amount of bluster from ministers opposite will conceal that fact. Healthcare costs are one of the largest items in the expenditure of ordinary Australian families. Healthcare costs are rising faster than overall CPI and faster than the incomes of most lower- and middle-income families. But I guess if you are a believer in Richie Rich economics, or if you're the Prince of Point Piper, as the Prime Minister is, you don't actually care. (Time expired)

Question agreed to.