Richard Di Natale (Victoria, Australian Greens) Share this | Link to this | Hansard source

My question is to the Minister for Finance, representing the Treasurer, and it's a very simple and direct question. Minister, can you explain why your US-style tax cuts that give someone, like a stockbroker or a politician, on $200,000 an extra $7,000 in their pocket while someone, say, a graduate childcare worker, on $40,000 gets only a few extra hundred dollars? Can you explain why that doesn't make inequality much worse than it is today?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Let me assist Senator Di Natale. An Australian taxpayer earning $30,000, under our plan to provide immediate tax relief to low-and middle-income earners, gets 8.3 per cent in income tax cuts, whereas a high-income earner—somebody on $200,000, as you've referenced—gets a 0.2 per cent cut in income tax under the initial—in fact, over the first four years, the value of the income tax cut for somebody earning $200,000 is 0.2 per cent. In every year, for somebody earning $30,000, it's an 8.3 per cent tax cut. For everyone earning $50,000 a year, it is a 6.2 per cent tax cut. So, clearly, the tax cut is very much directed and targeted at low- and middle-income earners. We are prioritising low- and middle-income earners.

But unlike the Labor Party and unlike the Greens, we want to encourage all Australians to work hard to get ahead. We want to back in all Australians, and we do believe in reward for effort. We know that in the socialist model of the Labor Party and the Greens equality of outcome makes everyone poorer, which has been tried in Eastern Europe to great effect. I would invite them to go and have a look. I know that that is the model that the Greens and the Labor Party subscribe to these days.

We believe in free enterprise, the free market, reward for effort, smaller government, lower taxes, backing in Australians, backing in Australian workers and helping Australian families to get ahead. That is what this is all about.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Di Natale, a supplementary question.

Richard Di Natale (Victoria, Australian Greens) Share this | Link to this | Hansard source

As someone who worked as a doctor, I know that massive tax cuts mean more crowded waiting rooms, they mean longer waiting lists to have surgery done and they mean bigger out-of-pocket costs for your GP bills.

We've got an ageing population and we've got growth of health costs into the future, and yet the government is saying that despite the fact it's ripping out $140 billion in revenue, it'll continue to fund Medicare in hospitals. Why isn't this just magic pudding economics?

Government Senators:

Government senators interjecting—

Scott Ryan (President) Share this | Link to this | Hansard source

Order on my right! Order! I will ask for order on my right during questions so that I may hear them.

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Clearly, it's a long time since Senator Di Natale has been anywhere near a patient, because if he were still working as a GP he would know that under the coalition—and this is a matter of evidence, of data and of actual fact, not a matter of political hyperbole—bulk-billing rates for patients attending GPs are at record highs. Let me repeat that: under the coalition, as a result of our policies, bulk-billing rates for patients visiting their GP are at record highs. And bulk-billing rights, in case the good doctor has forgotten about it, mean no out-of-pocket costs. So I don't know what he's talking about, but clearly it has been a long time since he's worked as a doctor.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Di Natale, a final supplementary question.

Government senators interjecting—

Order on my right during the questions!

Richard Di Natale (Victoria, Australian Greens) Share this | Link to this | Hansard source

The Prime Minister said that the government's three-part tax plan is a package that can't be broken up; it's got to be accepted holus-bolus. He hasn't presented any costings for his plan, and yet he can't guarantee that the money will be there from revenue from other sources to fund schools, to fund hospitals, to fund the NBN, to fund child care or to raise Newstart. Why shouldn't we believe that this isn't just a cynical vote-buying exercise a minute before the next election?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

Well, Senator Di Natale is entirely wrong. The costing for our personal income tax package is $13.4 billion over the forward estimates. The costing has been put forward by the government consistent with the requirements of the Charter of Budget Honesty.

Let me tell you something else that Senator Di Natale is wrong about. Our budget is forecast to return to surplus by 2019-20 and it's projected to remain in surplus all the way through the medium term to 2028-29. In fact, we are projected to return to a surplus in excess of one per cent of the share of GDP by 2026-27. By definition, that means that all of the expenditure on the important essential services that Australians expect in health, in education—you name it—is guaranteed.

That is one of our core objectives: to ensure that the funding for the essential services that Australians rely on is guaranteed within our budget while the government lives within its means.