Henry Pike (Bowman, Liberal National Party) Share this | Hansard source

I think it's important to remind the House about the core, the nucleus, of these two bills, the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 and the Treasury Laws Amendment (Cost of Living—Medicare Levy) Bill 2024, and that is a broken promise by this government. Unfortunately, these tax changes will barely touch the sides of the struggle for people under the current cost-of-living crisis, a crisis that has been made worse by the actions of this government. These changes will lock in long-term bracket creep, which is something that I'll touch on a bit later in this speech. I think it's important to recognise the impact that these changes will have over the long term, not just the immediate sugar hit that the government is hoping to achieve.

The coalition will not stand in the way of this bill. We will support it in order to support struggling Australians, not to support the Prime Minister's broken promise. We acknowledge that Labor's decisions in government have made life much harder for Australian families, and this bandaid solution will do little to fix the mess that they have made.

On Saturday, when I returned to my electorate, I had a mobile office at a local shopping centre at Mount Cotton. A number of my constituents came up to my little table and talked to me about the impact of the cost-of-living crisis on their purchasing ability in the local IGA there. They were talking about what they used to buy at this time last year that they couldn't afford to put in their trolleys this year. They talked about how these tax changes will do little to make an impact upon their household budgets, and they certainly talked about the lack of faith that they have in the current Prime Minister and the current government to deal with the economic challenges facing our country.

The Treasurer and the Prime Minister repeated their commitment to the stage 3 tax cuts over 100 times. The attitude within this chamber when members of the opposition or even members of the Greens party were asking questions regarding stage 3 was dismissive of any questions that were asked. Of course they were going to honour this commitment; it was madness to suggest that they wouldn't. Well, here we are, changing the promise that they committed to. The Prime Minister said that his word was his bond in relation to this commitment. Well, here we are, having suddenly discovered how much the Prime Minister's word actually means. The Treasurer now admits that the work to make this change has been underway since late last year.

Of course, this is only the latest in a series of broken promises from this government. We had the promise before the election of a $275 reduction in energy prices. This is something that they have not dared speak about within this chamber or within any media outlet since the election, but the Australian people remember that promise, and we're certainly going to hold the government to account on that. They promised there would be no changes to super taxes—another broken promise. They promised an increase to real wages, no changes to franking credits and cheaper mortgages. A lot of people at Mount Cotton on Saturday were telling me about the impact of increased interest rates on their mortgages and the challenges they're facing in just keeping their heads above water. And, of course, they promised no changes to the stage 3 tax cuts, but here we are this evening discussing those very changes. The Prime Minister has broken all of these promises I have listed. If the Prime Minister can make such promises to the Australian people so blatantly and then walk away from them, you have to ask the question: Can you ever believe anything that he says ever again?

Australians are struggling to pay their mortgages, their power bills and for their groceries, yet this government sees as a solution these tax changes that will save some Australians only $15 a week. Since the 2022 election campaign, Labor have promised to deliver cost-of-living relief yet, since then, prices have continued to rise. In the 18 months of Labor from June 2022 until December last year, we have seen food prices increase by nine per cent; the cost of housing, 12 per cent; electricity, 20 per cent; gas, 27 per cent increase; and insurance costs up 22 per cent over that period of time. This is at a time when the purchasing power of an Australian earning a gross salary of $85,000 has fallen by more than $7,600 since Labor came to office. So these tax changes will only return 10 cents to every dollar that individuals have lost due to Labor's failed management in this cost-of-living crisis.

We can also note that during this period the intake from personal income tax by the federal government has risen by a record 27 per cent. This government has added $209 billion in spending since they came to government and that's over $20,000 of extra spending for every Australian household. They should, of course, be reining in spending in order to help tackle inflation, and we know that Australia's inflation rate is significantly higher than a lot of the advanced economies around the globe. The Prime Minister has, unfortunately, ignored the cost-of-living crisis and is distracted by nearly every other issue under the sun, including spending so many months on the Voice campaign trail last year.

The Prime Minister has brought down two budgets and has failed to take any action to truly assist families, and this is just the latest in a rather meagre response to the cost-of-living crisis. I will give you an example. I asked a question of the Prime Minister late last week in relation to food bank lines within my electorate. Champion Support Services in Thornlands do a terrific job providing a whole range of services to locals in need. They are finding that over the course of 2023 the lineups for their food bank have tripled. They're telling me it's not just pensioners, it is not just people who are unemployed, it's not just the usual people they have experienced over recent years but, more and more, it is people who are struggling to pay a mortgage, it's people who are earning a good wage, or it is families who are finding it just impossible due to the circumstances that we are currently in to actually make a dent and make ends meet.

The coalition, of course, will always deliver lower, simpler and fairer taxes, and Australians can trust us to deliver this because we have in the past. Of course, we saw stages 1 and 2 of these tax reforms deliver significantly more dollars back in people's pockets than what the Prime Minister's new stage 3 tweaks will ever deliver. The Prime Minister's failed promises mean that delivering the stage 3 tax reforms is now impossible. However, the coalition is committed to going to the next election with a tax reform package that is in keeping with the stage 3 tax reforms. We remain committed to fighting bracket creep and enshrining aspiration within our tax system. Of course, that is so important. We will bring a tax package to the Australian people that will reward hard work and support a strong economy where every Australian has the ability to get ahead and we want to unite Australians rather than pick them against each other. A lot of the rhetoric, unfortunately, we have seen around these changes is pitting one group of Australians against another and it's not the Australian way. I don't think it is a narrative that will run well over the long-term.

Our package will be delivered while providing for Australia's future security and guaranteeing the essential services that Australians rely on. This package will be fully costed and ready to implement when and if we are elected and, most importantly, we will keep our promises. I think the Australian people have noticed through the tax reforms that we delivered in the last term of government how we can be trusted to deliver. The previous coalition government implemented this tax cut plan, with stage 3 to kick in on 1 July this year, to help Australians with the cost of living and to encourage aspiration. Stage 1 and stage 2 of the tax reforms of course delivered $40 billion in tax relief to low- and middle-income earners. The coalition also delivered tax relief to 10.1 million Aussies earning under $120,000, through the low- and middle-income tax offset.

In Bowman, my electorate, 8,900 constituents of mine will be worse off under the changes. These are hardworking Australians who of course deserve the tax break that parliament had legislated and that the government had promised to honour. Unfortunately, these people have been let down. It is also important to remember that if you consider Labor's decision to end the low-income tax offset in conjunction with these changes, there's a significant number of my constituents who are actually worse off. In fact everyone earning up to $120,000 is worse off when you consider the totality of Labor's tax changes in this term of parliament.

Of course we can't forget the impact of long-term bracket creep that this change in policy is embedding into our tax system. It was a fundamental feature of what stage 3 was supposed deliver. It was supposed to flatten out the tax brackets and avoid the impacts of rising wages and inflation on the tax intake over the course of the coming decades. Bracket creep is famously the thief in the night that steals the extra income that people are earning, particularly as wages naturally increase over time. Labor's broken promise entrenches bracket creep in our tax system, and it will in fact increase taxes by $28 billion for over four million Australians over the course of this decade.

Only those earning between $120,000 and $140,000 are truly better off under these changes, and even then, only modestly so. A lot of Australians, a lot of Redlanders, mentioned to me over the weekend as I set up mobile offices over the electorate, that they want to know what's next on the table. What else is this government going to be considering in terms of tax changes, now that they've made such a significant U-turn on this front?

The Prime Minister promised that under no circumstances would he touch the stage 3 tax cuts, in the lead up to the last election. My question is: what else is the Prime Minister promising not to touch that may well form part of their current considerations for this year's budget, or even heading further afield? Are we going to see changes to negative gearing? There was a question on that today. Are we going to see changes to CGT on the family home? These are questions Australians are asking, and we're not getting many answers from the government.

The Prime Minister has broken his promise on this front, and I fear that further promise breaking is certain to come. I certainly think the Prime Minister has failed to give a straight answer when asked very simply over the course of question time so far this week and last week to rule out breaking his promises in relation to negative gearing. The Treasurer was asked on 29 January about a plan to make changes to negative gearing, and he said that Labor wasn't considering it. That of course famously mirrors the lines that the Treasurer used in relation to the stage 3 tax cuts just a few weeks ago. The finance minister on the Today Show was asked the same question and said, 'We have no plans to do that.' That very closely mirrors some lines that the finance minister used in relation to stage 3 tax cuts as well.

They clearly haven't learnt the lessons from the 2019 election. Unfortunately, I fear that any changes that may be coming to negative gearing are actually going to be further killers of aspirations, particularly if the government is considering grandfathering existing provisions. People who currently have negatively geared properties benefit from that arrangement. My question would be: what about the next generation of Australians, the next generation of aspirants—the young people who I talked to over the course of the weekend—who aspire to one day own an investment property? Is the government proposing to kill off their aspiration to do so?

Ultimately this boils down to the fact that you cannot trust this government. I don't believe you can trust this Prime Minister either. No promise that they can make can ever be taken in good faith again. Every single policy commitment needs to be second-guessed. This Labor government has made life more difficult for Australian households over its course so far, and this relief will barely touch the sides when it comes to making a meaningful difference to household budgets.

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