House debates

Wednesday, 28 March 2018

Constituency Statements

Taxation, Dividend Imputation

10:46 am

Photo of Tim WattsTim Watts (Gellibrand, Australian Labor Party) Share this | | Hansard source

Young Australians should feel angry about our tax system. Since the Howard government, it's been set up to screw them, and now the bill is coming due for the federal government. While young Australians are trying to work out how to save to get a deposit to buy their first home, wealthy property investors, wealthy boomers, get a tax break for buying their second, third, fourth, fifth, sixth investment property. At every property auction around Australia there are two classes of bidders—young people and property investors with a tax lurk in their back pocket. The government spends more than $11 billion a year on tax concessions like this for property investors. That's more than we spend on universities and TAFE every year. No wonder home ownership for young Australians is at a 60-year low.

There's an even bigger tax lurk in our tax system for wealthy investors in shares. While all young Australians pay tax on every dollar they earn over 18K, and many of them have an ever-increasing HECS debt taken out of their back pocket to boot, wealthy boomer retirees who don't pay tax get given free money by the government if they own shares. Seriously—not a tax refund—free money, cash. The richer you are, the more you get given. You could own a house, you could own an investment property, you could have a million dollars in superannuation, and the government would still give you free money. We're the only country in the world who does this. Today's wealthy boomers are the only people who'll get this free money, because there's no way we can afford to keep doing this. Some government of some persuasion is definitely going to get rid of this in the decades to come, but today's young Australians won't enjoy it—it will be gone.

The free-money-for-shareholders policy already costs Australia more than $5 billion a year and in the near future will cost more than $8 billion. That's more than we spend on public schools. All of this is money that we could be spending on schools, hospitals, public transport, fighting climate change or even paying down the debt that this government has doubled since coming into government. The kicker here is that this isn't an old versus young fight. These tax lurks don't make our country fairer or more prosperous now or in the future; they just help the rich get richer. This is a haves versus have-nots fight. Under the Howard government, the wealthy set up a tax system to transfer billions of dollars from working Australians, from young Australians, to property investors and shareholders who don't pay tax. But I say: don't hate the player, hate the game. As Wu-Tang Financial said, protect your neck.

Young Australians will have a choice at the next federal election, a choice between a Turnbull government that wants to protection the tax advantages of wealthy shareholders and wealthy property investors and a Labor Party, led by Bill Shorten, that has a plan to fix our tax system and make it fairer for all Australians, to shut down these tax lurks and give young Australians a fair go.

Photo of Steve IronsSteve Irons (Swan, Liberal Party) Share this | | Hansard source

Before I call the member for Page, I might speak to the member for Gellibrand about his opening statement. He might want to consider the terminology he uses in some of his speeches; it's not that parliamentary.