Jim Chalmers (Rankin, Australian Labor Party, Treasurer) Share this | Hansard source

I move:

That this bill be now read a second time.

Today we are proud to introduce the Treasury Laws Amendment (More Cost of Living Relief) Bill 2025.

This bill delivers more relief in the tax system to Australians, more tax relief for every single Australian taxpayer—all 14 million Australians, in all parts of the country, not some.

From tradies to nurses, aged carer workers to teachers, sparkies to hairdressers, this legislation gives a tax cut top-up to every taxpayer, right up and down the income scale.

These additional tax cuts are responsible. They are modest in isolation, but they will make a difference in combination with the tax cuts which are rolling out already and all of the cost-of-living relief that we are proud to fund in last night's budget.

This bill amends the Income Tax Rates Act 1986 to cut the first marginal tax rate from 16 per cent to 14 per cent over two years starting from July 2026.

These changes will take the first tax rate down to its lowest level in more than half a century.

And they will mean the average earner will have an extra $536 in their pocket each year when they're fully implemented.

Combined with our first round of tax cuts, this rises to $2,190.

And the average total tax cut will be $2,548, or about $50 a week.

These tax cuts are the biggest part of a substantial and responsible cost-of-living package in last night's budget.

We know that the cost of living is front of mind for Australians and it was absolutely front and centre in the economic plan that we set out last night.

A plan that includes tax cuts and energy bill relief for households, cheaper medicines and early childhood education, student debt relief and free TAFE, plus strengthening Medicare and higher wages.

The tax cuts we are rolling out and topping up are cost-of-living relief with an economic dividend.

They return bracket creep.

They boost workforce participation.

And they incentivise people to take up that extra shift, which could push up hours worked in our economy by 1.3 million hours—mostly driven by women's workforce participation.

This all means they will strengthen household budgets at the same time as they strengthen our national economy.

We have also designed them to ensure our fiscal settings are consistent with inflation remaining sustainably in the Reserve Bank's target band.

As part of this legislation, we will also increase the Medicare levy low-income thresholds.

This is a bit more tax relief for more than a million Australians as well.

We will amend the Medicare Levy Act 1986and the A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999to increase the thresholds for singles, families, seniors and pensioners.

The thresholds will rise by 4.7 per cent so more than one million Australians on lower incomes will continue to be exempt from paying the Medicare levy or pay a reduced levy rate.

At the core of the economic plan we laid out in the budget last night is a simple objective.

Our government is all about ensuring more Australians earn more and keep more of what they earn.

The results of our plan are clear and compelling.

In the five quarters before our first budget, real wages fell in annual terms.

They have now grown for the last five consecutive quarters.

And real incomes per capita are growing now too.

This is a direct result of our plan to get inflation down, wages up, and tax cuts flowing in our economy.

This legislation is another important step in implementing that plan.

It's about giving extra help to Australians doing it tough.

It's about providing cost of living relief in a responsible way that strengthens the economy at the same time.

And it's about making sure all taxpayers see the benefits, not just some.

To stand in the way of this legislation is to vote for higher taxes on Australian workers.

To vote against this legislation would be to stand in the way of more hard earned money in the pockets of every hard-working Australian.

To vote against this legislation would be to stand against more cost-of-living relief that Australians need and deserve.

This is what those opponents are proposing, with the shadow Treasurer's brain snap last night when he said that he would oppose more tax cuts for every Australian taxpayer. That was the brain explosion that came out of the opposition lock-up last night, when the shadow Treasurer decided, after bleating about lower tax cuts in the lead-up to the budget. When this government is delivering it, they say that they're against it. Is it any wonder that those opposite are forming an orderly queue to say the shadow Treasurer is not up to the job of being the Treasurer of this country.

There's no consistency or clarity on the coalition's policy positions except for this—their commitment to cut cost-of-living help for Australians.

Those opposite want to cut everything except for income taxes. That's their position. They have consistently opposed the government's cost-of-living relief over the last three years. If they had their way, Australians would be thousands of dollars worse off already, and they have now made it clear that Australians will be worse off still if they win the next election.

They opposed our cuts to student debt, cheaper early childhood education and cheaper medicines. They opposed the first two rounds of our energy bill rebates. They opposed more homes for Australians and more urgent care clinics, if you can believe it, Mr Speaker.

They opposed the tax relief that started rolling out halfway through this year, and now they will oppose these tax-cut top-ups as well.

They are saying no three times in three years to three tax cuts. This makes the choice at the election abundantly clear. The shadow Treasurer's brain explosion last night, opposing these tax cuts, now makes the choice at this election absolutely crystal clear: a Labor government under this Prime Minister, cutting income taxes for Australian workers and helping with the cost of living, or those opposite and an opposition leader with a secret agenda for cuts which will make Australians worse off. That is the choice at the election.

On this side of the House, we proudly stand for lower taxes for Australian workers.

We are for Australians earning more and keeping more of what they earn.

And we are for doing everything that we responsibly can to help Australians under pressure.

That's what the budget was all about last night.

That's what this legislation does.

And that's why we are proud to introduce it to the House.

Debate adjourned.

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