Dai Le (Fowler, Independent) Share this | Hansard source

As we gather today, I reflect on the year that has passed since I first called for a significant redesign of the stage 3 tax cuts. It is with a sense of vindication that I note the government's consideration of this narrative in their proposed legislation. Moreover, it is encouraging to witness the government finally taking the cost-of-living crisis seriously, an issue that hits close to home for many Australians including those within my electorate of Fowler.

The stark reality of the cost-of-living crisis is being felt by working Australians both day and night. They are confronted with rising rents, record petrol prices, soaring food costs and insurance premiums that are nothing short of unbelievable, not to mention the 13 interest rate rises that we've endured.

This level of financial strain and pain is unprecedented in recent memory, underscoring the disappointment in the government's delayed response to amend the stage 3 tax cuts. This was a golden opportunity to extend a helping hand to ordinary Australians, an opportunity that has been evident since the inception of this government 21 months ago. It begs the question: why did it take the government so long to act and why did it fall upon a small backbencher like myself, representing the resilient community of Fowler, to highlight the pressing need for more immediate support for working-class Australians?

The need is palpable in my electorate, where a significant portion of working families fall within the low- to middle-income bracket, making them the most vulnerable to our ongoing cost-of-living crisis. The bill in question aims to reform, relieve, support a broader swathe of Australians, with a commendable 84 per cent of taxpayers poised to receive a more significant tax cut. Specifically, individuals earning under $45,000 are set to benefit from a tax rate reduction from 19 per cent to 16 per cent. At face value, this revision offers some relief to low-income earners, a move that should indeed be welcomed.

However, while the government's revised plans are a step in the right direction, they are not without their flaws. The Grattan Institute has voiced concerns about bracket creep potentially diminishing 'the value of the tax cuts over time', given that Australia's tax scales are 'not indexed' to accommodate 'wage growth or inflation'. This highlights the need for a more comprehensive approach to tax reform—one that lessens the burden on the income tax of working Australians and addresses the inequality of the current system. The devastating impact of the COVID-19 pandemic on jobs, small businesses, housing affordability, food security, household energy and the general wellbeing of Australians is still acutely felt in my community of Fowler and, undoubtably, in other parts of Western Sydney and Australia. My commitment has been unwavering in pushing the government to introduce policies that genuinely alleviate these issues and support our people. Time and time again I've stood up in this chamber to raise the alarm with the government about the cost-of-living crisis, sharing the heartfelt experiences of my constituents, which were often met with insufficient consideration.

Even the new tax cut offers minimal relief to my community in Fowler, which continues to grapple with the spiralling increases in the cost of essentials. We need to implement measures that will make a tangible difference in addressing the cost-of-living crisis now. The amendments to the stage 3 tax cuts are a step in the right direction, but they fall short. The average benefit of $15 a week does not cover the wide array of increases we have endured. Why have insurance premiums risen significantly more than inflation? Why is petrol excise relief not being considered? Who is profiteering, and what is the government doing to address it? Despite a significant drop in wholesale electricity prices, ordinary Australians are yet to see a reduction in their electricity bills. These are all areas where the government could and should take immediate action.

Deputy Speaker, allow me to bring specific examples from my electorate of Fowler, which is among the most disadvantaged and comprises some of the lowest income earners. According to the 2021 census, the median weekly wage of individuals in Fowler is $521 a week, equating to an annual income of $27,092. Under the proposed changes in the bill, this translates to an annual tax cut of merely $267 or a meagre $5 per week for each individual. This amount is insufficient to alleviate the financial pressures faced by my constituents.

Several constituents have shared with me their cost-of-living struggles, which I want to bring to your attention. One constituent with a low-salary entry-level job struggles with the expense of taking public transport to work and job interviews. With many of my constituents having to commute outside the electorate for work by car, the cost of petrol adds up. I've previously called on the government—and again today I asked a question about this—to do more about petrol prices, which are impacting low- to middle-income households' ability to travel for work. I have asked for a fuel excise cut so that hardworking Australians are not being penalised for making a living and providing for their families. The government have demonstrated that they are willing to listen in their adjustment of the stage 3 tax cuts, so why aren't they willing to listen and apply the same approach to fuel excise, when the government is reaping almost $20 billion from it? A fuel excise tax cut right now is really needed to help our community.

Another of my constituents, in Bonnyrigg, attended our office visibly upset, said that she could not afford to pay her electricity bill and asked for anything we could provide. The Australian Energy Regulator highlighted in their latest Wholesale markets quarterly report that average annual wholesale electricity prices in the National Electricity Market have dropped between 44 per cent and 66 per cent. I understand that there are no current plans to cascade the drop to energy retailers immediately, but it's critical to pass on the lower wholesale energy prices fast. I ask the government to consider what measures can be taken so that there is further energy cost relief for Australians.

Amongst those suffering from the cost-of-living crisis are individuals who have pursued tertiary education and cannot keep up with the aftermath of their student debt. Those who have completed tertiary education are locked into their HECS repayments, and these tax cuts offer little benefit for them. According to a Nine news article, a survey conducted by Think Forward with 1,000 millennials and gen Zs on their views of this tax system revealed that 90 per cent were of the view that the government was not doing enough to support them. A constituent from Fairfield East shared that she followed the traditional pathway of studying hard at university and finding a job but struggled to pay off her $60,000 HECS debt due to the 7.1 per cent indexation and a good portion of her salary going to income tax.

These are just some examples of the impact of the cost of living on my constituency. There are over 38,000 students in Fowler, with 20 per cent at university and 21 per cent being hopeful high school students who may eventually attend. They will join the workforce in entry-level roles. How do you expect them to survive? HECS indexation is determined by CPI, and it may increase again to keep up with the cost of living. I call on the government to consider freezing HECS indexation now to allow students and tertiary graduates breathing room. I have said repeatedly that young people are our future and good policy must be formulated to support them. This is not too much to ask from the decision-makers in this room and in this House, many of whom enjoyed free university degrees in their time.

Income tax is a sensitive matter to my constituents, as they are directly affected by the surrounding issues of the cost of living and affordability. I have joined with the member for Wentworth to call on the government to be bold and look at reforming our tax system. Currently, it's ordinary working Australians, the majority of low income and middle income, who seem to be carrying the weight of this country by paying the most taxes through the PAYE system. As Australians, they have a duty to pay tax to continue the running of the economy, but this should not be at the expense of being able to provide for their families or furthering their education. For low-income earners, who often are sole breadwinners of their families, it's harder, as they must ensure they distribute their income towards rent, food and their children. It is a paycheque-to-paycheque exercise.

I ask the government to put two hats on: a short-term one and a long-term one. In the 2021-22 financial year, low to middle income earners—being those earning $48,000 to $90,000—were afforded a $1,500 tax offset. I understand that this was a temporary measure. However, the feedback that I receive from my electorate was that it was very welcome relief during trying times. The extra money back in their pockets allowed them to allocate funds for varying needs of their families. If this is within the boundaries of the government's budget plan, I ask the government to consider a similar tax offset again as a short-term relief. If the former Morrison government was able to provide this short-term relief for low to middle income earners as well as the petrol relief, surely a Labor Albanese government—the party of the 'working people'—can match it or do better?

Tax policy is daunting, but we need to rethink the system. We need a fairer and simpler system. I call on the government to be bold and courageous and tackle this tax system that's overdue for a rethink. There are plenty of tax specialists and economic experts who I have no doubt would be able to provide the government with ideas and policies that could help tackle the pain points in the cost-of-living crisis. This can be a way forward. The time for action is now, and we cannot afford to delay in providing more of the support and relief that working Australians so desperately need. They cannot be left behind and forgotten, because they are the backbone of our country and the economy.

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