Chris Ketter (Queensland, Australian Labor Party) Share this | Hansard source

I rise tonight to contribute to this debate on the Treasury Laws Amendment (Enterprise Tax Plan No. 2) Bill 2017. Let's firstly look at what this bill intends to do. This is the coalition's vehicle to implement the next stage of its proposed corporate tax cut package: a package that will cost taxpayers around $15 billion each and every year from its full implementation. The government continues to say that this is baked into the budget and that it's accounted for. But I can tell you from our experience in the inquiries in relation to this matter that credible economic experts out there are concerned about the cost to taxpayers of this particular package, particularly given that if we do have a significant economic shock to the system at some point in time—and let's face it, we live in uncertain times with uncertain global players—then we are going to be in a perilous situation in terms of our fiscal position.

We know that in terms of cost this package blows out beyond the forward estimates. In our view, it's an unfunded budget wrecking ball, as I've indicated. At the same time that the Liberal-Nationals are fighting for more tax cuts for the top end of town and $17 billion for the big banks, we've got wage growth at historically low levels. Even the Treasurer has accepted that stagnant wage growth is one of the greatest threats to our economy into the future, but he has refused to do anything about it. They stand idly by while penalty rates are cut for hundreds of thousands of already-low-paid, often disadvantaged workers. The workforce is becoming more and more casualised, and the gig economy is growing, affecting job security for individuals and families. The cost of living is going up—medical expenses, private health insurance, energy bills, grocery bills and education. And, under the coalition's watch, the budget has already blown out, crashing through the half-trillion-dollar mark for the first time in history.

Despite this, the No. 1 priority of this government's agenda is still giving their big business mates a tax cut. That's on top of the personal income tax plan that they rammed through the parliament in June—a plan that gives 80 per cent of tax cuts to the top 20 per cent of income earners over the next seven years. The government rammed that legislation through by guillotining debate in the Senate, by confusing the crossbench and by silencing Labor. And let the record show that One Nation helped them to do it, just as One Nation might still vote for this bill—who knows?—a bill that gives $17 billion to the banks. That is the same amount that the government is ripping out of schools across the country—$17 billion. History shows us very clearly that Senator Pauline Hanson often says one thing in this place and then proceeds to do another, often to the detriment of Queenslanders—the people in the very state that she purports to represent.

So, whilst the top end of town gets a tax cut with the blessing of One Nation, all taxpayers have to pick up the bill for the Liberal-Nationals' burgeoning debt. Analysis shows that the Personal Income Tax Plan could cost Australians more than $10 billion in interest, or around $415 per person. To add insult to injury, workers on low and middle incomes will be expected to pay the interest on billions of dollars of tax cuts going to those people who need them the least.

It's increasingly apparent that the Liberal-Nationals have given up on trying to fix their abysmal record of fiscal management. Let's just recap, for the record. They've abolished the budget repair levy. They've ignored Labor's calls for tax transparency and for closing debt deduction loopholes—something that I have talked about in this place before. The Liberal-Nationals have ruled out negative gearing and capital gains tax reform—both policies that predominantly benefit the wealthy. They passed bigger tax cuts for the top end of town and ran a protection racket for the big banks while they ripped off everyday Australians.

Since the Liberal-Nationals came to power, net debt has doubled and gross debt has crashed through the half-trillion-dollar figure, as I have said. Both these debts are growing faster under the Liberal-Nationals than they did under Labor. Modelling tells us that gross debt will remain above the half-trillion-dollar mark every year for the next decade. This is despite Australia currently experiencing the best financial climate since the GFC—26 years of continuous economic growth. Let's not forget that it was the previous Labor government that had the responsibility of dealing with the GFC and that, in those toughest of economic times, it was the Labor government that got the big calls right and set us up for the recovery path that we are now on.

I know that the Liberal-Nationals like to make people think that Labor would be a higher taxing government. I've spoken on this issue in the past and I think it's relevant to talk about it tonight as well. That, in fact, is far from the case. I want to take a minute, once again, to talk about this, because I know there are people listening tonight to this debate—it's an important debate—who think that the coalition has a record of being low taxing when in government, when, in fact, the opposite is the case. I'm indebted, as always, to the research done by Stephen Koukoulas, the well-known economist, who first drew my attention to this issue. Let's take a look at the 10 highest taxing federal governments since 1980. If you look at the top 10 years since 1980 that we had the highest tax to GDP ratios, and if you look at the governments that were in power at the time, you will find that during eight out of the 10 years in question we had Liberal governments in place.