Allegra Spender (Wentworth, Independent) | Link to this | Hansard source

We're here to talk about tax. A lot of people are intimidated by the mention of tax, so let's start with why tax matters. It matters because tax shapes the country we want to be. When I think about why it's great to be an Australian, I often think of my mum's life, because she was a kid who arrived from Italy at the age of 11 with no money, no English and no connections. She finished school at 14 and, because of her own talent, energy and luck, she was able to create a great life for herself and her family.

When I think about the country we want Australia to be, I think we want it to be a country that encourages innovation, creativity and entrepreneurialism, a place where every individual can boldly bring their best talents to the community and to the world. But we also want it to be a country where every Australian can create a good life for themselves and their families, whatever their background, whatever job they do. We want it to be a country where you're not on your own when things go wrong. Our tax system needs to support these goals: entrepreneurialism, fairness, a good life and compassion. But right now it isn't, and that is why we need to talk about tax.

The topic today is the stage 3 reforms that the government has made changes to and the bills for which, the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 and the Treasury Laws Amendment (Cost of Living—Medicare Levy) Bill 2024, are now before the House. I acknowledge that right now many people across the country, including in my community, are experiencing enormous financial strain. These are some of the hardest times they've ever faced, and I see that it is appropriate that government does whatever it can to ease their burden right now. I acknowledge that the stage 3 changes that the government is going to put through will help a lot of families who need help right now, so let's understand not only what the government is putting through but also what the choices and costs are of what they have decided to reject.

Firstly, as I acknowledged, this is going to help a lot of people, a lot of working families experiencing financial strain. Secondly, I acknowledge that the changes to stage 3 will improve labour participation, and that is really important. I think they expect that there are going to be about 930,000 more hours per week that people will be more working in the economy. That is actually a really positive difference, particularly in the lives of women.

I think that this is a package that has support from a broad range of the community, but we are also giving things up by making these changes to stage 3, and I do not think these have been acknowledged appropriately. Firstly, we are giving up a lot of benefits in terms of simplifying the tax system—in particular, instead of having four different brackets, having one bracket from $45,000 to $200,000, which was the original stage 3. That would ensure that, for a lot of people, the desire to plan taxes and to use many company structures or other things to try to minimise their taxes was no longer attractive. That would actually add to the integrity of our tax system. It would make it simpler, make it easier to administer and make it less likely that people are going to use other complicated structures to avoid taxes. Secondly, the original stage 3 addressed bracket creep and incentives that the revised government proposal doesn't. While I support the opportunity that the government's proposal has made to increase labour participation, particularly at the lower income scales of the country, this also misses out on the opportunity to do it at the higher income scales and address bracket creep at the higher income scales, which I think is absolutely appropriate as well.

I supported the original stage 3, and when I came to considering whether I'd support the government's changes, the thing I thought was most important was going back to the community, because I knew that the community was going to be significantly affected by these changes and I wanted to know what they thought. In Wentworth, what we found through extensive consultation with people on the street, through emails and also through a survey, which ended up with over 1,700 responses, was that 70 per cent of the community supported the changes and that there was strong support, particularly among older parts of the community. There were many people who said they would benefit enormously from these changes. There were also people who said, 'You know what? I would've been better off under the original package, but I am supportive of the changes because I believe that these are the right ones.' As one person said to me, 'I will pay more tax, but I do not have a problem with that. I think we need to maintain a fairer progressive tax system.' That was something that came across from many members of the Wentworth community.

However, there are some people in Wentworth and across the country who are significantly negatively affected by these changes and have real concerns about them. One person wrote to me and said: 'It's going to have a big impact on my family. We are both in our 30s, two kids full time in day care, huge mortgage, cost of living increasing. We were relying on this cut, and now half of it has been stripped away.' I think it is really important to raise that and to talk about these people, because I do not think we've been having the conversation about the people who are affected in this case.

I started my speech talking about the idea of fairness and everybody being able to build a good life. One group I really think about a lot is younger people who don't have family backing to buy a house or get themselves set up. All they've got is the sweat of their brow, what they can build themselves. I admire those people who can really build up and create a different life to the one they were brought up with. This is what I think a lot of the Australian dream is really based on. But, in a country where we rely so heavily on income taxes and on taxing working people, as we do currently, it means that those people, if they don't have financial backing, can't get ahead in the way that previous Australian generations could. I think of this group of young people in their 30s. Maybe they don't have family who can help them with a mortgage. Maybe they don't have family who can help them with a deposit. They've started out and built something up. They were relying on the government to do what they said they were going to do and deliver a tax package, and that's what they expected in terms of their family budgeting.

As we think through this, we need to reflect on what else needs to change on tax. Based on the feedback from Wentworth and on broader considerations, I am going to support this package, but what I'm going to say to the House—which I've said publicly before—is that this mustn't be the end. We have a flawed tax system, and this must be the parliament that starts to address it. At the next election, we need to see ambitious tax reform going onto the agenda. I think what we have with the original stage 3 and right now is a missed opportunity. When I look at the tax system, the question I ask is not the academic one of, 'How do we optimise this from an economist's point of view?' What I really care about is, 'What is this going to do for Australian people?'

There are three massive challenges we are facing as a country that our current tax system does not address: intergenerational equity and housing; growth and productivity; and how we address climate action. Our tax system currently does not address these. While the changes to stage 3 and the other changes that the government has made will make some impact on the economy, they do not fundamentally affect or address the major issues facing our economy, and that is why we need broader tax reform.

I will give you a couple of perspectives on intergenerational equity. If you look at what is happening to younger generations, there is a sense—as there was from a young man who came to see me—that you can do everything right, you can study hard, you can get a big HECS debt, you can get a good job, but you still don't know if you'll ever be able to afford a home. That's the feeling on the street, but that's also represented in the numbers, where you see that a household that is headed by somebody over the age of 65 has had an increase in wealth by around 50 per cent in the last 10 or so years, but a household headed by someone under the age of 35 has had pretty much no increase in wealth.

So we've seen a disparity emerging between the wealth and prospects of different generations in our society. I do not support that, and I think it's why we need to look at tax, because tax influences that. Our capital gains tax system, our negative gearing tax system and our stamp duty all influence the housing market in different forms, and the housing market has been one of the biggest ways that younger people have been kept out of building the wealth and the security that previous generations have. For example, regarding stamp duty, the New South Wales Treasury's own estimates said that 350,000 more people would be owning their own home if we could move from stamp duty into land tax. This is where reform is urgently needed across our system.

The second major issue facing our economy is growth. Australia has low productivity growth, and so do many other economies. Why do we care about productivity growth? Because it drives our ability to pay for the services we want. If we had the long-term productivity growth that we had in the past we would have an estimated $50 billion more in our budget right now to supply and support things that are important or to give back to the people who earn that money, the taxpayers. But we don't have that strong productivity growth, and my concern is that we also don't have the policy settings to drive that.

One of the big policy settings we need to be aware of is the tax system. We have a corporate tax system where companies with revenue of over $50 million are now paying 30 per cent tax. This is way out of step with the OECD, where the average is 24.5 per cent. We cannot pretend in this country, one of the most open and trading countries of the world, that our tax system and the fact that we have an uncompetitive tax system for medium-size businesses does not affect the attractiveness of Australia as a destination for investment. Right now we are seeing Australia being a capital exporter rather than a capital importer .We're also seeing Australia with lower R&D investment and dropping foreign direct investment. These are all indicators that not only do we have sluggish productivity but also we're not making the changes we need to in order to grow our productivity in the future, and that is problematic for our system.

Finally, on climate, I think we're in a situation where we know we need to make changes and we're starting to make those changes to address the climate catastrophe that we have in front of us. But the ways that we're doing this, because we will not deal with the tax system, are some of the most expensive ways that we could possibly do it. We are wasting money because we won't face up to the fact that our tax system is not equipped to deal with the climate emergency we're facing. It means the investments we make cost us more money than they otherwise would. That is why we need to also reform our tax system in relation to climate.

So, when I look at the stage 3 change and I look at the other changes the government has put through—which include changes to superannuation, PRRT, changes to FBT on electric vehicles and other pieces—there are some parts I agree with, some parts I disagree with and some bits on the margin. I know tax change is difficult, and I accept that many a career has been won or lost on the basis of tax changes. But my point is that we need to be more ambitious, and we across the parliament have responsibility both to not wedge each other on these issues—and I'm afraid I haven't seen that yet—and to make sure we face up to the extreme issues the country is facing and have the guts to deal with them.

A major question I need to address in this speech is around integrity and broken promises, because this is clearly a broken promise. My electorate, probably more than any other, feels that because of the incomes of people in my electorate. I have three issues with what the government has done in this regard. I recognise that governments will need to change when circumstances change. I think that is appropriate. However, from a timing point of view, if the government had been contemplating a change like this they should have done as much as possible to do it as early as possible so that the people who are affected—the people who were budgeting, the people who got into rentals and maybe made decisions about houses based on what they expected their income to be—knew what they were getting into. So, I think that is unacceptable.

The second piece I'm really concerned about is the lack of acknowledgement by the government that some people really lost out and some people took the government at their word. The government has spoken a lot about the difference it's making to other people in the country, and I support that, and that is why I'm voting for this. But they should also acknowledge the people who have been affected negatively by this change in taxes who took the government at its word and were told that they were able to trust the government on this.

Finally, my question to the government is whether they should have made the commitment to stage 3 in the first place, given that they have now said they're not interested in further changes that would support the original stage 3 package. If they're not willing to support further changes that would address what stage 3 was trying to do, that gives us a real sense that they weren't really backing it in the first place, and I have real concern about that. This is the moment to deal with tax reform. We must do it coming into the next election, and this is a challenge across the parliament.

Michelle Rowland (Greenway, Australian Labor Party, Minister for Communications) | Link to this | Hansard source

I'm pleased to rise today in support of Labor's cost-of-living tax cuts for middle Australia, because every single taxpayer in my electorate of Greenway—and, indeed, the 902,000 taxpayers who call Western Sydney home—deserve to keep more of what they earn. From 1 July this year they will, thanks to the Albanese Labor government. Nearly nine in 10 taxpayers in Western Sydney will receive a larger tax cut under our plan than under the Morrison government's proposal from five years ago.

We are delivering tax cuts for the workers in disability, retail and transport, for the health- and aged-care workers, and for the accountants, teachers and tradies—every taxpayer. While our plan is responsibly targeted to boost support for hardworking families, it delivers for every taxpayer right up and down the income ladder. A worker on $80,000, for example, will receive a tax cut worth more than $1,670 a year, while a cleaner earning $50,000 will receive a tax cut worth over $900 a year. Under the coalition's alternative, many of these workers, often working part time with families, would have got nothing—not a dollar. All our wonderful nurses and postal workers will get a tax cut, with over 95 per cent of those taxpayers getting a larger tax cut as a result of Labor's plan. Those earning over $150,000 a year will also receive a tax cut of at least $3,700.

Families in Greenway understand that the Albanese government is on their side. Greenway constituent Maura wrote to me recently to give her heartfelt thanks, as did Santino, who said that Labor's tax cuts were 'so fantastic'. Those are just a few examples of Greenway locals who are relieved by the meaningful difference Labor is making to help ease cost-of-living pressures. I know there are many people in my electorate who are doing it tough right now, including households experiencing high levels of mortgage stress. Local residents, many of whom are migrants who moved to Australia for opportunities for themselves and their children, are asking us to do more to help. To say to those families that there's nothing their government can do would be a furphy. The federal government is in a position to help without making the economic situation worse by adding to inflation, and our better tax cut plan does just that.

It complements our work to deliver electricity bill relief and cheaper child care, medicines and GP visits. We have increased rent assistance, delivered fee-free TAFE places and extended free broadband for school students with no connectivity at home. Labor recently launched an ACCC inquiry into supermarket prices and allegations of price gouging—the first of its kind since 2008. And we are getting wages moving because we want workers to earn more and keep more of what they earn. Helping our communities with the cost of living is our No. 1 priority. If the cost of essentials rises too fast, people can't plan or save for the future.

One of the great privileges I have in representing Greenway is meeting the people for whom our Labor policies are making a real difference. We're helping people just like Maura and Santino to strive for more to make a good life for themselves and their families. Unlike the coalition, which just says no, the Albanese government is saying yes to supporting Western Sydney families keeping more of what they earn. These new tax cuts are the right decision at the right time for the right reasons.

Paul Fletcher (Bradfield, Liberal Party, Shadow Minister for Government Services and the Digital Economy) | Link to this | Hansard source

I rise to speak about the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024. I want to put three propositions to the House this morning. The first is that what the Albanese government has done here is a terrible failure of tax reform. My second proposition is that this is a cynical breach of a promise made by the Prime Minister and other senior Labor figures over 100 times. My third proposition is that this is a second best to what the coalition has legislated, and the coalition has reached a decision because we are in a world, to use the economic jargon, of second bests. Let's start with the terrible failure of tax reform which this backflip by the Albanese Labor government represents. The rationale for these stage 3 tax cuts was to deliver structural reform to the tax system, to encourage aspirational Australians who want to work hard and get ahead. The whole design of the stage 3 tax cuts was that, between $45,000 and $200,000 of income, anywhere you are in that range, you know that you would only be paying 30c cents in the dollar.

The stage 3 tax cuts were part of a long-term plan that was designed and legislated several years ago. It was done with the view of giving Australians adequate notice of the change that was coming to allow them to make their decisions about how they wish to respond, should they choose to do so. If you were thinking about doing some extra shifts or getting an extra qualification so your earnings increase or if you were thinking about starting a business, you would do these things with the knowledge that, for an income right up to $200,000, the most that you would be paying would be 30c in the dollar in tax.

This was a design intended to address the known and corrosive impact of bracket creep, which results in more of your income being taken in tax every year through the effect of inflation. I make the point that a very deliberate intention of this reform was to remove the 37c tax bracket. The result would be a simpler, clearer, fairer tax system. There would be a 30c bracket and a 45c bracket. The effect of the 30c bracket under the plan, legislated by the coalition and promised to be upheld more than 100 times by the Prime Minister and his party, would have been to cast onto the ash heap of history the 37c per cent tax bracket and, in turn, unleash greater activity, greater energy, greater aspiration by Australians in the knowledge that throughout that range, from $45,000 to $200,000, they would pay no more than 30 cents in tax.

Unfortunately, all of that has now been trashed by the Albanese Labor government. The government have said a lot of deeply misleading and inaccurate things in the course of justifying this egregious broken promise. One of the things we never hear from those opposite is the historical fact that this is stage 3 and that suggests, doesn't it, that there was a stage 1 and a stage 2. Indeed, there was a stage 1 and stage 2, each of which were very much focused on reducing the burden on low- and middle-income earners. That was a very important component of the coalition's plan.

The third component of the coalition's plan was to change the tax system through this long-term reform that would increase the incentive for people as they thought about how much work they wanted to do. It has to be said that one of the deeply regrettable consequences of this cynical political decision, this political backflip, taken just months before this long-term change was due to take effect, having been legislated several years ago, is that it will make it so much harder in the future for any government that wants to engage in serious reform of our tax system.

You need only talk to any economist and they will tell you that our tax system is a drag on Australia's productivity, on Australia's competitiveness, on Australia's prosperity. Tax policy experts consistently argue for a simpler system and one that imposes, in the economic jargon, the smallest possible deadweight loss. According to John Humphreys of the Australian Taxpayers Alliance, 'Stage three income tax cuts represent Australia's most important piece of microeconomic reform in 20 years.' He adds the cuts would have created 'a simpler, more efficient tax system that will help boost productivity and promote long-term wage growth'.

Economists talk about a dynamic as compared to a comparative static perspective. What we hear from Labor and what we hear from the Left is a comparative static perspective. You assume that the income that every Australian has now is cast in stone and the only thing that could change is the tax rate, and that leads to these long tables of winners and losers. But the whole point is the economy is not static; it is dynamic. People change their behaviour in response to incentives. If you face a lower tax rate, you have a stronger incentive to work harder. That is good for individuals and good for the entire economy because the economy grows. Creating that stronger incentive is what the stage 3 tax cuts are all about. Now, all of that has been torn up and thrown in the bin.

Let me turn secondly to this cynical breach of a promise that we have seen. This is a triumph of crass, short-term political opportunism over the long-term tax reform process. For over three years, Labor consistently said they would honour the stage 3 tax cuts. In July 2021, the then opposition leader, the member for Grayndler, and his Treasury spokesman, the member for Rankin, said:

An Albanese Labor Government will deliver the same legislated tax relief to more than 9 million Australians as the Morrison Government.

Their explanation for why they were going to do this was straightforward:

Labor is providing certainty and clarity to Australian working families after a difficult two years …

Well, they promised certainty and clarity; they delivered the opposite. On more than 100 occasions, the Prime Minister and other senior Labor politicians committed to maintaining the stage 3 tax cuts. They committed to maintaining the tax cuts which are in the legislation now and have been for several years.

This was a promise made repeatedly before the 2022 election, during the 2022 election and after the 2022 election, including numerous times in December 2023 and January 2024. We know from what has now been revealed, including through Senate estimates, that at the same time that the Prime Minister and the Treasurer were repeatedly saying to Australians, 'We have not changed our position; we remain committed to the stage 3 tax cuts,' they had in fact changed their position. They had directed Treasury to proceed to come up with a changed plan. They assert this ludicrous proposition that it was all Treasury's work. The Prime Minister and the Treasurer were just sitting at their desks, twiddling their thumbs, whistling, looking into the middle distance, and all of a sudden, bang! On their desks dropped a new plan that Treasury had worked up all of its own volition.

That is one of the many ludicrous and completely non-credible claims that have been made by the government as they have twisted and turned and danced about trying to justify one of the most egregious breaches of trust ever committed by a prime minister against the Australian people. To say more than 100 times, 'We will take this course of action,' knowing that across the country people are listening to him, listening to the government, taking them in good faith and arranging their affairs in reliance on that promise, and then to cynically reverse that position is one of the worst breaches of trust Australians have ever seen from a prime minister.

What it means is that Australians cannot believe a word that comes out of the mouth of this Prime Minister, this Treasurer, any Labor minister or any Labor member of parliament. How can you believe a word they say when they told the Australian people 100 times and more—before the election, during the election, after the election—'We will maintain the stage 3 tax cuts,' and then cynically, deliberately, dumped that promise? They broke their promise. They looked the Australian people in the eye and said: 'Oh, that thing we said 100 times we were going to do? We're not going to do it.' It is hard to think of an example of more disgraceful conduct by a prime minister and by a political party than the conduct which has been engaged in by the Prime Minister and by the Treasurer over the last month.

After all of that, despite their claims that this is now justified because it will offer relief to Australians from cost-of-living pressures, the sorry truth is it will deliver very little relief at all. The fact is that in Labor's first 18 months of government the amount of personal income tax collected has risen by a record 27 per cent. Headline inflation is more than 1.6 per cent above the midpoint of the RBA's target band. Food, housing, insurance, health and education costs are all growing faster than the headline inflation rate.

What then will be the impact of the measure contained in this bill we're debating today? What we know is that for somebody on the average wage, their net after-tax real disposable income has fallen by $8,000 since Labor came to power just 18 months ago. That's $150 a week that somebody on the average income is worse off compared to 18 months ago. And yet that same person will receive a benefit of just $15 a week from these tax cuts that are now being trumpeted. So you've gone backwards $150 every week thanks to the rank economic incompetence of this government. And now the Prime Minister says: 'Great news! I'm going to deliver you an extra $15 a week.' It is a mere drop in the ocean. The reality is that people are hugely worse off under this government, and the tax cut that the Prime Minister is talking about barely touches the sides.

Let me turn, then, to the rationale for the position the opposition is taking on this bill. The Prime Minister seems frustrated. In question time he's been saying, 'Oh, well, if the opposition were fair dinkum, they would oppose this bill because they campaigned against my rejigged tax scales.' I'm sorry to break it to the Prime Minister: he can decide what his policy his; the opposition will decide what our position is. To use another piece of economic jargon, once the Prime Minister took his decision, we were in a world of second best not first best. The decision for the coalition became, 'What course of action should we now take given the government is going to take roughly $106 billion, the cost of the stage 3 tax cuts, and spend it all on a modified tax scale, different to the one legislated, different to the one they promised to maintain on over 100 occasions?' They won't just spend the $106 billion; indeed, they'll spend an extra $28 billion.

We are now in a world of second best, and this government is using its numbers in the House to ram through this outcome. But if the government of the day is using its numbers to offer a different set of tax cuts, then, if the first best has been removed, the choice for us is: do we support the second best? It is the second best, but we've made it plain we will support it. We've also said we'll be responsible, because we're not going to then commit to additional spending unless and until we can be satisfied it can be funded. We've been very clear we're committed to go into the next election with a tax reform package that's in keeping with the stage 3 tax reforms. Our package will deliver lower, simpler and fairer taxes, fight bracket creep and enshrine aspiration in our tax system.

This has been one of the most unedifying breaches of trust by an Australian government for many years. The Prime Minister's standing has been permanently damaged. A valuable long-term reform has been junked. And for years to come we, as a nation, will lament this missed opportunity for reform.

Sam Rae (Hawke, Australian Labor Party) | Link to this | Hansard source

It's always a great pleasure to follow a characteristically flaccid contribution by the member for Bradfield, the previous speaker, and perhaps seek to reintroduce a little intellectual honesty to the debate. We on the Labor side know that Australians are doing it tough. Global inflation and supply chain pressures have squeezed household budgets as the cost of living increases—and people are feeling the pinch. While inflation is moderating and our targeted assistance packages are providing important relief, we know that Australians still need support. That's why the Albanese Labor government has introduced these tax cuts—to provide cost-of-living support to Australian households doing it tough. It's about providing relief through reforming and reshaping our income tax system to ensure Australians keep more of what they earn.

The Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 and the Treasury Laws Amendment (Cost of Living—Medicare Levy) Bill 2024 will deliver a fairer tax system, return bracket creep to taxpayers and drive labour supply in our economy. It's not only an important measure to address the cost-of-living challenge; it's an enduring reform that rewards the hardworking Australians at the heart of our economy. Nurses, teachers, truckies and retail workers will all get a bigger tax cut. In fact, 84 per cent of all Australian taxpayers will receive a larger tax cut under Labor's plan. That's because we're improving our income tax system right up and down the income scale.

From 1 July this year we're cutting the 19 per cent tax rate to 16 per cent, we're cutting the 32.5 per cent tax rate to 30 per cent, we're increasing the 37 per cent tax threshold from $120,000 a year to $135,000 a year, and we're increasing the top tax threshold from $180,000 a year to $190,000 a year—the first time this has been increased since Labor was last in office. This holistic reform will deliver more support to the working Australians who need it most.

In my electorate of Hawke, the average taxpayer will receive a tax cut of $1,428—that's $800 more than under the former Morrison plan. Every single one of the 73,000 taxpayers in my electorate of Hawke will receive a tax cut, and 89 per cent of people in my community will be better off under Labor's plan. These are local tradies, nurses, police officers and early childhood educators who will be taking home more pay every week, providing valuable relief to their household budgets. For example, a household in Melton in my electorate with a teacher on 85 grand and a part-time factory worker on 40 grand will save a total of $2,458—almost $1,500 more than under the Liberals' old Morrison plan. There are tens of thousands of households like this across my electorate and millions right across the country that will see similar savings.

Given that these changes will see every Australian taxpayer keep more of the money they earn, it should come as no surprise that Labor's tax cuts are also better for the economy. When we invest in our workforce, reward working people and properly incentivise participation, we grow the economic pie for all. Good economic management is all about building an economy that works for the people, not the other way round. That's why since Labor came to office we've increased funding to aged care and rolled out cheaper child care. That's why we've improved the pay and conditions of workers with our secure jobs, better pay bill and our closing loopholes reforms. That's why we've seen record increases to minimum and award wages, two consecutive quarters of real wage growth and the strongest wage growth for 15 years. And it's why we're delivering these tax cuts.

This is what the Albanese Labor government is all about. We're delivering higher wages and lower taxes so that Australians can earn more, keep more of what they earn and make the economy stronger for all. Treasury estimates that Labor's tax cuts will increase labour supply by nearly a million hours a week—more than double the impact of the Liberals' original plan. This is because Australians will be better incentivised to work more under Labor's tax cut plan, particularly in some of our most in demand professions, such as those in the care economy. Thanks to Labor's tax cuts, 97 per cent of registered nurses will be better off, 97 per cent of carers will be better off and 97 per cent of childcare workers will be better off. By incentivising taxpayers to work, Labor's tax cuts will boost labour supply across these professions right across our country and our economy.

Clearly, Labor's tax cuts aren't just about making our income tax system fairer; they're about responding to the current economic conditions that we face. It is important to remember that, since the former Liberal government legislated their plan five years ago, we've had a once-in-100-year pandemic, persistent global inflation and multiple foreign conflicts that have all contributed significantly to the rising cost of living for Australian households.

Unfortunately, while these rising costs have been felt by all Australians, they have disproportionately impacted low- and middle-income earners. The Treasury advice on Labor's tax cuts showed that people in the lowest income quintile were spending more than their disposable income as quarterly inflation peaked under the Liberals opposite. The advice also showed that working Australians were experiencing the highest increase in the cost of living, with those in the bottom three income quintiles far more likely to be experiencing financial stress. That's why Labor's tax cuts are necessary: to put more money in the pockets of every Australian taxpayer, especially those who need it most. Importantly, the Treasury also confirms that we can do this without adding to inflation, because Labor's tax cuts plan is a broadly revenue-neutral approach.

We know that those opposite will vote in favour of this bill despite the way they carry on. The Leader of the Opposition has publicly declared this. They might stand up at the dispatch box and flail around, but ultimately they will walk into this House and vote in favour of this tax plan. They refuse to admit that this government has made the right call by delivering larger tax cuts to more Australians. They just can't bring themselves to say it. Perhaps it's because they spent nearly a decade failing to live up to their own false sense of economic superiority. They failed to deliver a single surplus, they suppressed wages, they oversaw the worst decade for productivity in our country in 50 years and they racked up $1 trillion of Liberal debt. Meanwhile, in under two years, the Albanese Labor government has delivered the first surplus in 15 years. We've delivered tens of billions of dollars in cost-of-living relief through child care, energy bills, rents medicine and more; we're getting wages moving again, with wages growing at four per cent, the highest rate in 15 years; and we've had two consecutive quarters of real wage growth. And now we're delivering meaningful income tax reform, leaving more money in the pockets of every Australian taxpayer.

Given the Liberals' decade of failure, it is hardly surprising that they can't quite wrap their heads around another example of responsible economic management from the Albanese Labor government. It is almost as if they can't believe it's possible. They don't know what to do. When asked if the opposition would roll back Labor's tax cuts, the Deputy Leader of the Opposition jumped up and said: 'This is our position. This is absolutely our position.' While the Leader of the Opposition has since said that the Liberals will support Labor's tax cuts, it is clear from the Deputy Leader of the Opposition's statement and the blithering contributions from those opposite in this debate that they are being dragged kicking and screaming to it. It's clear that they're more interested in the politics than they are in the policy of cutting taxes for working people.

The case for Labor's tax cuts is absolutely crystal clear. It's good social policy, it's good fiscal policy and it's good economic policy. It will boost labour supply, return bracket creep to those it hits hardest and, most importantly, ensure that 13.6 million Australian taxpayers will get a tax cut on 1 July. I am very proud to be part of a Labor government that is delivering the support that the households in my community desperately need. Thanks to Labor's tax cuts, families right across Hawke, from Sunbury to Melton and from Bacchus Marsh to Ballan, will be able to earn more and keep of what they earn, and we'll keep looking out for them as they face the cost-of-living pressures that they are currently facing.

Zali Steggall (Warringah, Independent) | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024. Whilst I support the assistance that this amending legislation will provide to many in our communities, I do have great reservations as to how we have arrived at this point and the way in which the government has handled this issue over several years now. I was in this place when the original tax package was first legislated in 2019 and raised concerns then in relation to the stage 3 tax package because it was not due to take effect for some five years and that good policy would require keeping an open mind and considering the economic circumstances of the time. So it was with mixed feelings that I watched the PM and the new government repeatedly dig in, denying that there would need to be a consideration of that tax package, after having supported it in the last government, and resisting time and time again. I think this ultimately created an unnecessary hole, which is unfortunate.

I also really dislike, and many in my community have raised, the tone of class warfare coming from the government, which is disappointing. It's a populist pitch. The pitch that those on higher incomes can afford to receive less of a tax cut than the coalition's legislated package shows the core of the issue. We rely far too much on personal income tax to fulfil government coffers, which is overwhelmingly contributed to, ultimately, by tax on higher incomes. We need a wholesale review of the tax system. That means everything should be on the table: the GST, company tax, capital gains tax, taxing resources and, certainly, taxing multinationals.

The Treasury's Intergenerational report 2023 highlighted that Australia's population and productivity are projected to grow more slowly over the next 40 years, leading to slower economic growth compared to the past 40 years. An ageing population will also be a challenge. The participation rate is projected to decline, as will average hours per worker. That's going to pose a challenge to how we fund the government services we all rely on. The same Intergenerational report noted that, over the next four decades, the five main spending pressures of health, aged care, the National Disability Insurance Scheme, defence and debt interest payments will rise from around one-third to around one-half of all government spending.

Speaking to the report last year, former Treasury secretary Dr Ken Henry was scathing: 'People who are weighted down with HECS debt, who are going to have to repay a mountain of public debt, who are dealing with the consequences of climate change and who are facing diminishing prospects of ever being able to afford a home of their own, these poor buggers are also going to be the ones who are facing ever-increasing average rates of income tax.' Dr Henry's sentiment gets right to the nub of it. We need urgent reform. The current model is simply not sustainable.

Australia currently has one of the lowest income thresholds in OECD countries for the higher tax brackets. We rely far too heavily on personal income tax to fund our essential services, yet we do nothing to make resource conglomerates pay their fair share. The petroleum resource rent tax, the PRRT, that is currently being proposed by the government is a joke; let's get real about that. It is one of the most lax resource rent tax systems proposed in the world, even including recent reforms—in particular, the reforms the government is proposing. Its failures have been highlighted in recent years as gas companies have reaped windfall profits, yet many projects have not paid any resources tax. Add to this the fact that many of these companies are also not paying any company tax and you're really adding insult to injury.

As I've noted before, foreign owned Arrow Energy, Australia Pacific LNG, Chevron and ExxonMobil didn't pay income tax for seven years, resulting in all profits heading straight offshore. Australians are horrified that these companies can make $138 billion from our natural resources and pay nothing in tax. Australia has one of the weakest resource tax regimes in the world, and one of the most generous to oil and gas companies. In contrast, Norway taxes 78 per cent of export resources profits, delivering a $2 trillion sovereign wealth fund. This supports health care, child care and other social measures, all without discouraging investment. The government is shirking its responsibilities to undertake comprehensive tax reform.

I want to raise a concern about how we got here and the way the government has approached its decision-making and then communicated the changes to the stage 3 tax cut package. In the lead-up to the last election the Prime Minister gave a guarantee that the stage 3 tax cuts would stay locked in, as had been legislated. On numerous occasions since the last federal election he repeatedly said there would be no changes. In one interview he is quoted as saying, 'My word is my bond.' I watched all this with misgiving, because all this does is erode trust. You dug the hole yourself, Prime Minister. The government should never have gotten itself into a corner by constantly assuring people that they would not touch the original stage 3 tax cut package.

I'm not opposed to good policy changes being implemented as circumstances require. These tax cuts were legislated as a package of reform. It was always problematic that stage 3 would come into effect five years after being legislated. Honest government would have been upfront with the public. Government policies must adapt to changing circumstances, and circumstances have changed over the last 12 months. This is not something that just happened in December and January of this year. Instead, we saw an abrupt policy change out of the blue and a tax change without an exposure draft and certainly without public consultation.

The question that is out there is, what else is up for sudden change without proper, sober consultation or due policy process? Will the climate change targets be up for renegotiation because there's pressure in some electorates, maybe? Or the commitment to a net zero economy? That's the issue the Prime Minister and the government must now contend with: trust. In the 2023 Edelman Trust Barometer, trust in government leaders has declined to 41 per cent, marking a decline for numerous consecutive years. I feel that the loss of trust can't be overlooked. There's no doubt that cost-of-living pressures are hurting many in the community: prices, power bills, inflation, interest rates and insurance premiums have gone up and are squeezing household budgets. There is no doubt that economic circumstances have been tight for more than 12 months. So I absolutely welcome the support that this provides for many in our community.

I want to thank all the people in Warringah who have reached out to me to let me know how they feel about the government's proposal and who have provided me with their feedback. Many of them are impacted by the change in terms of receiving less, in particular receiving less of a tax cut than they had been planning to receive. It's heartening to see the generosity of so many who want to see those on lower incomes receive more benefit. In fact, more than 80 per cent of those who have corresponded with me are in favour of those tax cuts, with many indicating that they were due to receive more but favour the amendments. And I note that according to Treasury data Warringah has some 82,000 taxpayers who will receive an average tax cut of $2,226 under the new package. It will leave about 56,000 taxpayers better off, which is approximately 68 per cent of taxpayers in the electorate. Treasury analysis also indicates that this will support more women and greater participation in the workforce—all good things.

But I have asked for, and I would welcome, further information or modelling explaining why the settings by the government have been put where they are and how they've been decided on. I appreciate that the income thresholds that are indicated in the bill are significantly above average Australian wages, with incomes of between $137,000 and about $200,000. I would say, though, that often they are not in a class of uber-wealth as would be described by many on the government benches, particularly when one considers exploding house prices in electorates like Warringah.

So I have written to the Treasurer to request clarification of what the modelling was and why they put the 37 per cent tax rate at the threshold of $135,001 and the 45 per cent tax rate at the threshold of $190,001. In the Treasury advice released by the government there's no clear reason that these thresholds have been chosen and what alternative thresholds and rates were considered, if any. Are there clear benefits or drawbacks compared with other thresholds? There are no clear answers from the government on this. There is also no provision in the government legislation to index tax brackets to really address bracket creep, which will impact millions of Australian taxpayers in the coming decade. I've written to the Treasurer with those questions but have not received any response.

Changes to the tax system should be done openly. They should be done with consultation, and I would argue that they should be done with exposure drafts so there is a broad consensus and ability to really assess the benefits and the merits of what is being proposed and where it's being proposed. We also have to be cognisant of the timing of this. We are seeing sittings of parliament till 10 pm on endless nights because of the timing. We know what was already legislated has been done for several years. Accountants and financial professionals have set up their advice and planning based on the original time line and measures. The ATO has set up its calculators. Everything was in place for the system as legislated, and the government repeatedly assured everyone that they would not amend or repeal. Now all the systems and practices put in place to address what was legislated must be overhauled in time for 1 July 2024, assuming this legislation passes. I would argue that it is bad policy to be changing at so late in the piece without the right kind of consultation. We should be approaching a serious issue of tax reform that impacts every Australian taxpayer with due process and care.

I absolutely support simplifying the personal tax brackets and incentivising Australians to work hard, earn more and keep more of their income. We need to move away from so much reliance on personal income tax revenue and make resource giants and multinationals pay their fair share. Focus needs to also be on those suffering the most right now. Whilst this is addressing many in our communities, the most needy are actually not really benefiting much. The reality is that those suffering the most are the poorest in our community. They're those on JobSeeker, student allowance and age pensions. They won't be benefiting much from this package. So, if the government is really committed to helping those who are doing it tough and they're not just out for votes because of the popular appeal of this policy, then they would be committed to increasing payments such as JobSeeker to ensure that it is above the poverty line, alongside increasing other support payments.

The detail of the bill—for many, there's been a lot of discussion, and I encourage residents of Warringah to go to the website. We will be putting up the detail in relation to the stage 3 tax cuts. The most important aspect is that essentially what was passed in 2019 has been repealed and has been replaced completely with new personal tax rates, which will bring the following brackets into effect. The bill will change the 19 per cent tax rate to 16 per cent for those earning between $18,200 and $45,000. This is welcome for young people in particular. It will change the 32.5 per cent tax rate to 30 per cent for those earning between $45,001 to $135,000. It will increase the threshold above which the 37 per cent tax rate applies from $120,001 to $135,001. It will increase the threshold above which the 45 per cent tax rate applies from $180,001 to $190,001, noting though that it was legislated to be at $200,001, so it's really an increase in tax for that bracket. That means that all taxpayers essentially earning around less than $150,000 a year will receive a larger tax cut than they would have done under the original stage 3 package, while those earning more will receive a lower tax cut. The concern, again, is that there is no provision for indexation, and so with bracket creep what we will see is more and more people getting less of that benefit.

Despite my concerns, I'm absolutely in support, and I thank again all the people from Warringah who have written to me to let me know their thoughts. But I urge the government to think about trust and integrity and to bring the Australian people along with them when they are considering major policy changes. At the end of the day, whilst this may have gone down well, it raises the spectre of the question of what will be next. Trust in government once lost is lost, I think, forever. So, for me, there is that question. I must say that the Prime Minister, I think, on a number of occasions has identified his word as his bond, but that ultimately cannot be believed. When I look at other significant policy areas, such as climate change, energy, commitments in relation to net zero and commitments to a local issue like PEP11, which have still not been implemented—the Prime Minister promised that it would be dead, yet it is not—the question of trust and integrity will forever be there.

Linda Burney (Barton, Australian Labor Party, Minister for Indigenous Australians) | Link to this | Hansard source

There is no doubt that Australians have weathered a turbulent time over the last five years. A once-in-a-century pandemic, persistent inflation, high interest rates, two conflicts and global uncertainty have put Australians under more sustained cost-of-living pressures. When tax cuts were legislated under the previous government five years ago, our economy looked quite different. Such a big change in our economy needs a different response, a better response. Good governments do the right thing for the right reasons. Good governments prioritise people ahead of politics. Australians have told us that they are under pressure. They have told us that they need their government to act. Action is what this bill will deliver, and it delivers to every single taxpayer. Young Australians are better off. Older Australians are better off. Women are better off. Nurses, teachers and aged-care workers are some of those most likely to benefit. More than 95 per cent of those workers across Australia are getting a bigger tax cut.

It's communities like those in my electorate of Barton that need and deserve Labor's tax cuts. Constituents in my electorate have told me that cuts as they were legislated five years ago are not going to work for them. Organisations caring for our local communities have told me more people are coming to them for help. They've told me that the government needs to respond to the pressure Middle Australia is under. The government has heard these messages from Barton and communities across Australia loud and clear. That's why Labor's tax cuts mean that every Australian taxpayer—every single taxpayer—will receive a tax cut this year. In the electorate of Barton, 85 per cent of taxpayers will receive a bigger tax cut than under the previous government.

I want to tell you, Mr Deputy Speaker, what tax cuts will really mean in communities like Barton's. Ninety per cent of women taxpayers will receive a bigger tax cut with Labor's tax cuts. For a schoolteacher at one of our wonderful local schools, it will be an average of $2,429. For a registered nurse at the beginning of her career at St George Hospital, it will be a tax cut of $1,554. Childcare, aged-care, and disability-care workers will benefit too.

For some here in this place, the first instinct was to go straight to politics. They made it clear their hearts weren't really in tax cuts for Middle Australia. They have said these numbers don't seem like much of a difference. The Deputy Leader of the Opposition even said that they would roll these changes back, making 11.5 million Australians pay more in tax. But Australians tell us what kind of difference this will make. It's meaningful cost-of-living relief delivered in a responsible way that doesn't add to inflationary pressures and that lays the foundation for a stronger and more resilient economy.

Cutting taxes for Middle Australia is a central part of our economic plan, but Labor's tax cuts proposed in this bill, the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024, are just one way in which we are providing important cost-of-living relief to families across Australia. Labor is focused on making the essentials more affordable for everyone. An additional 360,000 GP visits nationally were bulk-billed in the last two months, saving Australians $15 million. In my community of Barton, residents have already saved nearly $2 million on cheaper medicines because of our government. We've also delivered cheaper child care. Affordable high-quality child care is essential to boosting the participation of women in the workforce. It also prepares our children for success at school right through to year 12 and further education. The ACCC has found that, since their introduction in July 2023, boosts to subsidies and funding have meant that prices of early childhood education have dropped on average by 11 per cent across the country. The government is also supporting parents and children before they even go to preschool. From 2026 paid parental leave will increase to six months. This is the biggest expansion of paid parental leave since Labor introduced it when we were last in government. We've also taken action on the cost of living through electricity bill relief. From 31 July last year, our electricity bill relief has taken $125 off the power bills of New South Wales residents each quarter. That's vital support for millions of families, pensioners and concession card holders.

Energy bill relief, paid parental leave, more affordable child care, cheaper medicines, boosting bulk-billing and tax cuts to every taxpayer—that is how Labor is acting on the cost of living. The most recent inflation figures show a welcome moderation, but it's still too high. Treasury advice is clear that Labor's tax cuts will not add to inflationary pressures, because they are broadly revenue neutral. Stakeholders from the community sector, unions, economic experts and academics agree that Labor's tax cuts are a sensible response to a rapidly changing economic situation. This package of tax cuts is also a response to what Australians have been telling their government and their representatives to do about their concerns about cost of living and fairness and what aspiration actually means. Every Australian aspires for more for themselves and their children—not just to get by but to thrive. Ensuring that every taxpayer takes home more each week recognises that aspiration should not only be for those who are already doing well. Australia faces so many challenges. When good governments see problems, they listen and they act, and we have. Putting people above politics is about taking the best advice from experts. It's about listening to Australians, hearing about the problems they face. Those Australians rely on us to work for them, to respond to changing circumstances. I am proud to be part of a government that is doing exactly that—doing the right thing at the right time. I am pleased to support the government bill and I look forward to 1 July, when every taxpayer in the electorate of Barton will get a tax cut.

Bert Van Manen (Forde, Liberal Party) | Link to this | Hansard source

It's a pleasure to rise and speak on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024. It has taken 18 months of coalition warnings and Australians crying out for help, but the message seems to have finally sunk in for the Treasurer and the Prime Minister: Australians are in a cost-of-living crisis. It may have occurred to them once they saw the national figures which show that, over the past 18 months, groceries are up by over nine per cent, housing is up by over 12 per cent, electricity has gone through the roof for many and is now up by at least 18 per cent, insurance costs have risen by 22 per cent and gas is up an incredible 27 per cent. Inflation remains stubbornly higher than in other developed nations. These are incredibly difficult conditions for ordinary Australians, and the pressures that we see in the households across the country are reflecting this. More and more Australians are being forced to use what money they have saved just to stay afloat, and this was confirmed by the Reserve Bank governor in hearings last Friday.

You would have thought these figures would have caused concern for the Treasurer and the Prime Minister long before now and that they would actually take the time and effort to produce a serious long-term economic plan to address these issues. But what have we seen? Another broken promise. They could have provided the full tax reform package that was legislated as stage 3 and was intended to address the creeping problem of bracket creep and the exact economic conditions which exacerbate the issue in a high inflation environment, but they chose to do something else. They chose instead to remove the low- and middle-income tax offset rather than extend it, a $1,500 loss for many families across my electorate of Forde. They could have taken action last year rather than waiting until now. Instead, they held back from outlining any meaningful cost-of-living relief through last year's budget and failed to outline an economic agenda that works for the Australian people. As I've said before in this place, my electorate of Forde has many hardworking Australians from a wide range of occupations. They have been screaming out for this government, the Labor government, to act on this cost-of-living crisis. When the government had the opportunity to do something to alleviate this burden in the last budget, they did nothing. They spent all of 2023 ignoring these problems and being distracted by a $450 million failed referendum, but in the morning leading up to a by-election they have gone: 'Oh dear! Now we need to do something.' In their haste to right their political fortunes, the Labor government have taken the easy option of breaking another promise instead of implementing a clear and coherent economic agenda.

We've seen over the past couple of weeks a multitude of those opposite willing to get in front of a television camera and tell Australians how great these changes are and how much they'll help reduce these cost-of-living pressures. I say to those opposite that it only tells part of the story and fails to take into account a much broader range of issues that are facing Australians. I might reflect on some of those issues.

Real net disposable income per person has fallen by 8.6 per cent across this 18-month period. For an average income earner, this is a decline in take-home pay of around $8,000 over the course of the year. We see that with these changes to the stage 3 tax cut package an average worker will be better off by some $15 a week, yet $8,000 a year equates to about $150 a week. So, in net terms Australians on average incomes are still $135 a week worse off under this government, and yet we've got those opposite crowing about their economic success and how they're relieving the cost-of-living pressures for everyday Australians. Well, they come from a different world to the one from which I do. This $15-a-week saving is less than one per cent of the average annual wage and returns just 10c in every dollar people have lost through the cost-of-living pressures through this Labor government's first 18 months in office.

Over the course of this second reading debate I have heard multiple members on the other side ringing off these dollar savings amounts. But let's look at some of the other things that have been missed in this discussion. If we go back to the broken promises of this government, of which this one is just the latest: a $275 reduction in energy prices—well, that's not materialised; no changes to superannuation taxes—well, that has gone by the wayside; an increase in real wages—no, we haven't seen that; no changes to franking credits—well, that's gone by the wayside as well; cheaper mortgages—no. On average, in my electorate, people are paying an extra $24,000 a year just in extra interest on their mortgage, let alone the capital component on top of that, all from after-tax income. And no changes to the stage 3 tax cuts. As the Prime Minister said, his word is his bond. Well, that's obviously not worth particularly much.

If I look directly at an example of some of the employees and occupations in my electorate, a truck driver in Forde on the average wage will receive an $804 tax cut. However, when combined with their real income drop, they will be roughly $7,200 a year worse off. I know those opposite, in various answers to questions in question time, are waxing lyrical about the various occupations across the country and the tax savings they will achieve. But they never address the full picture. This is what the Australian people should be very, very careful about. It is not what Labor says; it is what Labor does that they need to watch out for, because nine times out of 10 they are two very, very different things, and Australians are paying the price for that right now.

An electrician in Forde can thank this government for being $7,200 a year worse off as well, even with these changes. A concreter in Forde will find their $15 a week tax cut will still see them $138 a year worse off under this government's economic plan. A receptionist working in one of the many small professional services businesses in my electorate will be some $238 worse off this year because they will lose the low- and middle-income tax offset, even taking into account these changes.

I have yet to touch on the impact of the government's failed economic policies on small to medium businesses in my electorate. If we think that household electricity costs have gone up by some 18 to 20 per cent, for many small to medium businesses their electricity and gas costs have gone up significantly more than that—significantly more. Many of those small to medium businesses rent their premises and many of those lease increases are tied to CPI, to inflation. So their rents haven't gone up by three per cent, unlike some of the big retailers in major shopping centres; they have gone up six, seven, eight per cent. Now the interest costs for their overdrafts have also gone up significantly more than household borrowing costs. Who pays for all of those cost increases? Households and consumers.

So once again the government has failed to have a detailed economic plan which takes into account all of those issues that flow right through our economy. I know the member for Wright is here in the chamber. He has a very significant agricultural base in his electorate. How many of those producers of agricultural products are struggling to make ends meet because of their rising input costs, including the cost of water, electricity and fertiliser? That is feeding directly into the cost-of-living pressures that our Australian households are feeling. What has the government done to address any of those issues? Zero—nothing.

Scott Buchholz (Wright, Liberal Party) | Link to this | Hansard source

They were all told it was going to be easier.

Bert Van Manen (Forde, Liberal Party) | Link to this | Hansard source

As the member for Wright just said, they were all told it was going to be easier. Sadly, that is very, very far from the case. It is not easier. It is getting tougher each and every day. The government has no answers and is completely out of credibility in this space.

We welcome the reduction in taxes for people on lower to middle incomes because we're a party of lower taxes. We've always prided ourselves on having a lower tax environment, and that was exactly the purpose of the three stages of tax cuts. This government has presided over a 27 per cent increase in personal income tax receipts in its time in government. The coalition, should it be returned to government, will focus on delivering lower, simpler, fairer taxes. We will look at fighting bracket creep to enshrine aspiration in our tax system, not just for households but for business.

I've spoken to a number of businesses of late, including manufacturing businesses—and it's interesting to see the Minister for Industry, Science and Resources in the chamber—who are talking about shutting their manufacturing processes here in Australia and moving them offshore. They'll keep their R&D here, but they've said to me it is just too hard and just too difficult. One of the key drivers of costs for them is electricity, but the increase in our electricity costs is, in part, a direct result of government policy. On the one hand you have the Treasurer saying, 'We need to reduce taxes to deal with the cost-of-living issues,' yet on the other hand we have the Minister for Climate Change and Energy driving up living costs by virtue of government policies in the space of energy. Energy goes into every single part of our economy. Until the government is prepared to deal with those issues, we will not see a reduction in the overall cost of living for people. As a businessperson said to me recently: 'If I think costs are going to continue to go up, I'm going to put my prices up in preparation for those costs going up. I'm going to insulate my business.' That is the mindset business is in today. I don't see that any of the government policies currently proposed are going to do anything to address those issues.

On this side, we want to reward hard work and support a strong economy where every Australian can get ahead and to unite Australians rather than pit people against each other. Whilst the coalition is supporting this bill, it is clear that these changes do nothing in the long term to provide relief—or they only provide relief for a fraction of the cost-of-living burden that Australians have incurred. The Prime Minister, who campaigned on integrity and transparency and even uttered the phrase, 'My word is my bond,' can no longer be trusted by the Australian people.

Louise Miller-Frost (Boothby, Australian Labor Party) | Link to this | Hansard source

The Albanese government started this year with great news for every single taxpayer in Australia: every taxpayer gets a tax cut. All 13.6 million taxpayers will be getting a tax cut as of 1 July. Labor's tax cuts under the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 deliver more relief to more people in a way that is fiscally responsible and doesn't add to inflationary pressures. These new tax cuts are designed to provide bigger tax cuts for middle Australia to help with the cost of living, while also making our tax system fairer—because it's not only tax relief; it's also tax reform. Our tax cuts are good for Middle Australia, good for Australian families, good for women, good for young people and good for low-income workers. Our tax cuts are good for helping with cost-of-living pressures for every single taxpayer, our tax cuts are good for labour supply, our tax cuts are good for tackling bracket creep and our tax cuts are good for the economy.

It is the job of an Australian government to do the right thing for Australians and for the economy, according to the economic realities of the time, and that is exactly what we're doing. The Albanese Labor government is introducing these changes because it recognises the economic realities of 2024. Australians are under pressure right now, and Australians deserve a tax plan that responds to the challenges they are facing. When the coalition's stage 3 tax plan was legislated five years ago, the world was a very different place. It was before a once-in-100-year pandemic, worldwide persistent inflation, higher interest rates, two overseas conflicts impacting supply chains and prices, and global uncertainty. These things have put Australians under more sustained cost-of-living pressure. When the circumstances change, changing policy is the responsible thing to do.

Our overarching responsibility is to consider what is the best thing for Australians now, and cutting taxes for Middle Australia is a central part of our economic plan, but only one part. It sits alongside getting wages moving again, bringing inflation under control, driving fairer prices for Australian consumers and providing important cost-of-living relief such as energy bill relief, cheaper medicines, higher income support payments and the biggest boost in rental assistance for 30 years.

Labor's tax cuts will make a real difference for the 13.6 million Australian taxpayers who will receive a tax cut. That's every Australian taxpayer, with no taxpayer left behind and no taxpayer ignored. This is 2.9 million more taxpayers than would have benefited from the stage 3 tax plan from five years ago. It means that 11.5 million taxpayers will receive a bigger tax cut. That's 84 per cent of all Australian taxpayers better off under this plan. In my electorate of Boothby, the number is 85 per cent of taxpayers better off under this plan. Ninety per cent of women are better off under the tax plan. Ninety-six per cent of young people under the age of 29 will be better off under this plan. Gen Z are among the biggest beneficiaries of this tax change, because they were ignored under the previous plan of the Liberal and National parties.

Under Labor's tax plan, taxpayers earning less than $45,000 will now receive a tax cut. Previously, they got nothing. This will significantly boost the take-home pay of Australians on modest incomes and people working part time. Under the coalition's plan, taxpayers earning under $45,000 got nothing. An Australian taxpayer earning the average wage, around $73,000, will now get a tax cut of more than $1,500 a year, which is around $29 a week. That's more than double what they would have got under the coalition's plan. That's nurses, teachers, truckies, and so many more Australian workers who are the absolute backbone of our economy and are earning around the average wage. For an Australian family on an average household income of $130,000, with, say, one partner earning $80,000 and the other around $50,000, their combined tax cut will be over $2,600, which is about $50 a week and $1,600 more than they would have got under the Liberal and National parties' plan.

But these are not just short-term gains. Labor's tax plan also meaningfully addresses bracket creep in a way that, as Treasury has modelled, better addresses bracket creep than the opposition's stage 3 tax cuts ever would have. The government's changes deliver a better and more progressive tax system and address bracket creep more evenly. Our plan returns bracket creep for all taxpayers and does more to reduce the impact on those most burdened by it. By dropping two tax rates and lifting two thresholds, we are giving everyone a tax cut, providing $359 billion in help with the cost of living and returning the most bracket creep where we can do the most good for Middle Australia. As a result, the average taxpayer will pay $21,635 less income tax over the next decade.

And of course it's also good for the economy. Labour shortage is one of the issues I heard about from businesses large and small during the last election, and it's something this government is taking seriously. Treasury estimates that our changes will increase labour supply by around 930,000 hours per week. That is more than double the labour supply impact of the former coalition government's plan. This is driven by increases in hours worked and participation of women with taxable income between $20,000 and $75,000. Parents, particularly women with young children, will be meaningfully supported to return to work under the government's changes through increases to their take-home pay.

The really critical consideration in making this change and in all the cost-of-living relief we've provided over the past year is to ensure that what we do is not inflationary. The advice from Treasury is clear that our tax cuts will not add to inflationary pressures, because they are broadly revenue neutral. The most recent inflation figures show a welcome moderation. It's still too high, but it is moderating, and Treasury is clear that our tax plan will not impact their forecasts and timing for inflation to return to the target band. The Albanese government is providing meaningful cost-of-living relief in a responsible way that doesn't add inflationary pressures while laying the foundations for a stronger and more resilient economy.

So, what it is actually going to change? From 1 July this year the government will reduce the 19 per cent tax rate to 16 per cent, reduce the 32.5 per cent tax rate to 30 per cent, increase the threshold above which the 37 per cent tax rate applies from $120,000 to $135,000, and increase the threshold above with the 45 per cent tax rate applies from $180,000 to $119,000. The 45 per cent tax threshold will be lifted on 1 July for the first time since Labor was last in office. All 13.6 million Australian taxpayers will receive a tax cut from 1 July onwards. The government's tax cuts will return bracket creep and lower average tax rates for all Australian taxpayers, and this is a great-news story.

What is the Liberal-National opposition's position on this? Well, the hint is in the name: they oppose it. The deputy opposition leader, prior to even having the detail of the bill, said they would roll the changes back. When asked if the opposition would roll back Labor's tax cuts, she said, 'Well, this is our position; this is absolutely our opposition'—absolutely. This means they will make 11.5 million Australians pay more tax—an interesting position to take, considering that the opposition's seats are some of the biggest winners from this change. But the Liberals and the Nationals have made it clear that they do not want these tax cuts for Middle Australia. I know they voted against every other form of cost-of-living relief as well. But here they are directly against the tax changes that will put more money in the pockets of their own constituents.

Our tax cuts come on top of billions of dollars in targeted and responsible cost-of-living relief that's been rolled out, including electricity bill relief, cheaper child care which resulted in an average 11 per cent drop in childcare fees across Australia, increased rent assistance, tripling of the Medicare bulk-billing incentive which resulted in more bulk-billing GPs, cheaper medicines through the drop in prescription payments and 60 day dispensing, a boost in income support payments, expansion of eligibility criteria for the single-parent payment and the JobSeeker supplement for older workers, fee-free TAFE training, more social and affordable homes, and expanded paid parental leave. We are creating jobs and getting wages moving again.

The Labor government's tax cuts have been very welcome across my electorate. It's a great-news story: 100 per cent of taxpayers will get a tax cut, 85 per cent of Boothby taxpayers will get a bigger tax cut, 90 per cent of women taxpayers will get a bigger tax cut and 96 per cent of young taxpayers will get a bigger tax cut. Labor is the government of higher wages and lower taxes. We want you to earn more, we want you to be paid fairly for the hours you work and we want you to keep more of what you earn in your own pocket. I commend the bill to the House.

Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) | Link to this | Hansard source

I rise today to, first of all, spell out that it doesn't matter whether you now have to reconcile yourself to why a promise can be broken; the fact is you broke it. That means that, when people go to an election, they look for honesty and authenticity in what is described to them as to what's going to happen if a certain government is elected. If you then subsequently decide to change, for whatever reason it is, you've broken your promise. One would suggest that what you should do, if you're so moved by wanting to make a change, is honour your promise and then, in addition, take a further legislative change. You can't just go up to any person on the street and say, 'I owed you $1,000, but I met another person and now I'm deciding only to pay you $450 because I've been moved to decide to pay you less.' What you should say is, 'Here's your $1,000 and now I have to address the person down the street who is also in need.' That is generally how promises work.

But it is such a great trick; it's such a great parlour game. Once you've taken the money away and spent it somewhere else, you can't go back and take it off people. That is logical. Yes, it's a great parlour game and, yes, it's so clever, but, ultimately, that's all that people remember—they never thank you for the tax cut, but they remember that you broke your promise. That's precisely what's happened here. Of course you can say to people: 'You've got more money than you had before. What do you think about that?' They'll say, 'That's a great idea!' Find any one person who's cognisant of what's happening in their wallet and say to them, 'How do you feel about having more money in your wallet?' and it'll be a no-brainer, but that does not give you an excuse to break your promise.

In National Party seats, we have other issues that are at the forefront. We have a lot of people who are poor. The breakdown of where people are is that the teal seats are the wealthiest, then the Greens seats, then the Liberal seats and then the Labor seats. We look after the poorest. We look after the people who are really doing it tough in the weatherboard and iron. That's who we look after. Yes, there are people who are very comfortable, and good luck and God bless them, but the highest proportion of poor people are in our seats. If they're earning less than $40,000, what is proposed here will make no difference at all because they hardly pay any tax. We increased, in stage 1, the low-income offset so that basically they're tax-free.

How do you help those people? And, by gosh, they're really doing it tough. How do you help them? They have second-hand cars. In some villages out in these areas there are no police, there are no doctors, the houses are falling to pieces and there's no public sewerage. This is the life they live in. And they're living that life around me. There are people who are 100 per cent—100 per cent!—zero emission. Do you know why? They have no power. That is why they have zero emissions. There is no power. Why? Because they can't afford it. I remember taking people into the back streets of some of the villages around me. They'd say, 'No-one could possibly live in that house,' and I'd say, 'Well, explain to me why there's smoke coming out of the chimney in the middle of winter.' It's why we have a strong view on certain issues, on policy. One of the biggest issues for them is power prices. If you take away their power, you drive them into absolute hard poverty.

The other day, in a reconfiguration which is so well-meaning but so physically, by reason of physics, crazy, we had Loy Yang go offline. Yes, they had a storm, but storms happen all the time. We haven't had storms by reason of the differentiation in what's happening in the actual power grid that knocked out a major power station, or a large part of a major power station. The price of power per megawatt went up to more than $16,000. It used to be around $35 or $40. It doesn't matter what we think, that then flows through all the way back to the weatherboard and iron. What happens to them is they cannot pay their power bill. Now we have record numbers of people who are no longer on the grid, and this has to be addressed. If you really want to look after people who are doing it tough, you go to one of the core issues in their lives—their power bill, their grocery bill, their capacity to pay for a dentist and the fact that they've got a second-hand car. If you start changing fuel standards and saying, 'This and that will happen,' that's all well and good where people have money. But, where they don't have money, they can't afford the car they've got. Every time they go to get groceries, they can't go to a corner store, because there is no corner store. If there is, it's incredibly expensive. Their trip to the major supermarket takes fuel, and everything they do is more expensive. You've got to go to the fundamentals of their lives and address those.

That's the role of the Nationals and the members around here who live it—and I know that includes the member for Cowper, because his electorate is right up against mine. We had a road between us. It just disappeared. It just went. Imagine that in an urban environment. Imagine that one of your major connecting roads just goes after a flood. It's years later, and it hasn't been put back. This is the sort of life that we've got. What happens to the people on that road? There are people who live there. How does it work for them? Just to give you an example, we had a bridge in our area, and it went out for three years. That's three years without a bridge on the major connecting road. These are the realities that we deal with.

Each one of these is a decision you've got to really focus on. How do you help people who earn below $40,000 a year? I might just note that, if you are earning over $135,000 a year—or about $139,000 with increments, but I won't go into the nuances of it—you are actually getting less money after these tax changes. On the other side, there'll be a lot of people on $139,000 who would say, 'I'm going alright, but I'm not super rich.' For my part, I'm looking after people under $40,000. This became accentuated yesterday at two o'clock, when Loy Yang went out. Hazelwood is gone, and they said it wouldn't have an effect. It had a massive effect. Liddell is gone, and they said it wouldn't have an effect. It had a massive effect. Now Loy Yang is under threat, and they're talking about closing down other baseload power generators. We've seen that intermittent power in the form that is rolling out now does not do the job. It's alright if power is a little bit of your life and expense, but it's absolutely devastating if it's major.

On the other side are groceries. For politicians in regional areas, it's said that a lot of your politics is done in the pub. That's romanticising it a bit. But I'll tell you that talking to people is done in the supermarket. Sidle up beside someone who's trying to pay for their grocery bills, and just have a look. Do you know what the humiliation is like when the card says, 'Declined; see issuer for details'? Do you know how humiliating that is for people? Do you know all the statements that are made? 'There must be a mistake' or 'A payment must have come out.' These are true stories. In my area, I was talking to one of my constituents, and she said she was vegetarian. I thought, 'Well, that's good.' Then she put the addendum on it: 'It's not because I want to be. It's because I can't afford meat.'

People think this is not happening in Australia. It is happening in Australia. I'm glad we've got an ACCC inquiry. That's important, but I'll tell you something that we've sort of been aware of for years. Big supermarkets are supported by big unions so they can make big profits. Because of big unions that work with big supermarkets, the supermarkets have big political power. They come close to us on our side too. Make no mistake about that. I'm not saying that we are without fault on this one. It absolutely exists on our side as well. These people are mercenary. They don't care how they do it, as long as, at the end of the day, they're looked after. They will feign virtue so that you keep your eye off them, and they will do what they've got to do. We've got to ask a serious question: how many years have we been dealing with this, and how far have we progressed? How far have we managed to get a sword of Damocles so that these people act fairly? What have we actually done? Is it time we think about it, look at other countries, such as the United States, Canada and England, and ask: 'What do those countries do? How do they go about it? What are we missing here?' I pose that question because, to the people in the big supermarkets: I know you're watching, and I know you know exactly what I am talking about. This is another issue that has to be looked at.

So we've got power prices and grocery prices, and then we've got fuel. Fuel is another one. Without fuel, you're going nowhere. In a regional area, if someone in your house has a stroke or a heart attack and you haven't got fuel in the car, they're dead. You just can't get to the hospital. Remember, we don't have hospitals. In fact, we do have some hospitals but—I kid you not—they've got no doctors into them. If the nurse falls over, you have to find another hospital, because the hospital hasn't got a doctor. The problem we've got in Australia is that we're not building new refineries; we're closing them down. And the jobs for people in blue-collar work, like jobs at aluminium smelters—not in my area—are closing down. The blue-collar manufacturing jobs that these people do, because they haven't been to university, are just being taken away. What we have now in our area is contractors on farms—fencing contractors, mustering contractors, people trying to make sure that they can make a buck. But, in terms of substantive jobs, because power prices have gone up we have become uncompetitive with overseas countries.

The best way to deal with the cost of living is to have more cash. That really helps with the cost of living. But we can't propose a strategic advantage by saying we're going to have the wages of India or Bangladesh. That would be outrageous. Commodities are at a global price, so there is no strategic advantage there. So you've got to look for other areas where you have a strategic advantage. The one we had in the past was power prices. Now that's gone. Of course, because that has gone your manufacturing capacity is lost.

The government have to be able to address—it's especially pertinent today because of Loy Yang—exactly what they intend to do, not their mythical desires and what they believe, in a sort of Peter Pan economics, will happen in the future. They have to actually address what they're going to do about fixing the power crisis—and we now have a power crisis. If you can't fix the power crisis, you've got no hope of fixing the cost of living. What you do to tax rates—whether you turn the dial backwards or forwards—will make absolutely no difference to what's happening in the lives of people who are in the $0- to $40,000-a-year bracket.

Honourable Member:

An honourable member interjecting—

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

Order! The member is entitled to be heard in silence.

Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) | Link to this | Hansard source

What we are seeing at the moment is precisely that.

I want to go through some other items. In our area, getting kids to school means that mothers have to drive them, because we don't have bus services. The mothers have to drive them, to be quite frank, because the guy may be working in another job having to bring money in—or the guy may be at home. To be honest, that's not as much, obviously. But, because they have to drive, they can't have a job. They don't have a job because their whole day is occupied in driving the kids to school and picking them up from school and driving them home.

An honourable member interjecting—

I just said that there are also fathers. You have the opportunity of two-income families, and we don't.

Clare O'Neil (Hotham, Australian Labor Party, Minister for Home Affairs) | Link to this | Hansard source

It's 2024, Barnaby!

Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) | Link to this | Hansard source

I'll take the interjection. If it's 2024, why don't you give us the same services that you have in your 2024 world in your urban environment? Why don't we get the child care? Why don't we get the health care? Why don't we get the police service?

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

Please address yourself through the Speaker.

Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) | Link to this | Hansard source

Why don't we get those? Why don't we get them? Why don't we get those services? Why aren't you addressing those services in this cost-of-living debate? Why aren't you talking about how you're going to get buses out to regional areas? Why don't you talk about how you're going to get doctors into regional areas?

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

Order! The member for New England, address yourself through the Speaker.

Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) | Link to this | Hansard source

Okay. Why don't we have a discussion about why we can't get obstetrics? Why don't we have a discussion about why we can't get aged care? There are a lot of discussions to be had, if you want to talk about 2024, about how your life in urban Australia, in the inner suburbs, is completely and utterly distracted and different to the life that we have to live. And the infuriation we have is that we hear comments just like that, scoring a cheap political point and being completely ignorant to the realities of the lives of the people who are actually doing it really tough in this nation.

Anthony Albanese (Grayndler, Australian Labor Party, Prime Minister) | Link to this | Hansard source

I'm pleased to speak in favour of Labor's cost-of-living tax cuts. We just heard from a fellow who was Deputy Prime Minister of Australia not once but twice—the sequel no-one wanted! He stood at the dispatch box having been part of a government for the best part of a decade, including twice being Deputy Prime Minister, and spoke about how the electorate that he represents and the electorates that the National Party represents don't have services, don't have infrastructure and don't have support. At the same time, those opposite have gone out there and supported tax cuts which overwhelmingly benefited people in the inner cities, not in regional Australia.

Our tax cuts are aimed squarely at regional Australia and the outer suburbs. Our tax cuts are aimed squarely at Middle Australia. Our tax cuts are aimed squarely at ensuring that people are not left behind. Our tax cuts, unlike the ones that those opposite propose, deliver for all 13.6 million taxpayers, not just some. The former Deputy Prime Minister is right that electorates like his have a lower average wage compared with an electorate like mine. Do you know what people who are on high incomes in my electorate are telling me? They are telling me that our tax cuts are fairer. They understand that a good society means not leaving people behind. They understand that people on average wages—Middle Australia—will get double the tax cut that they were going to get under the previous system.

A shop assistant on $32,000 will get a tax cut of $414. They were going to get nothing. A nurse on $76,000 will get a tax cut of over $1,500. A teacher on $80,000 will get a tax cut of $1,679. A police officer on $110,000 will get a tax cut of $2,429. An IT manager on $160,000 will get a tax cut of $3,729. Every politician will get a tax cut of 4½ thousand dollars. We have made sure that no matter what income you are on, right through the income scale, you will get a significant tax cut compared with your existing income. We understand that people who are on lower than $45,000 do deserve a tax cut, and lowering the rate from 19 per cent to 16 per cent will flow right through the income scales. But we also understand that people right through those income scales are deserving of support, which is why we are lifting the threshold at which 37 per cent comes in from $120,000 to $135,000 and we are lifting the top marginal tax rate from $180,000 to $190,000. That is the first increase in that threshold since 2008, since the Labor Party last occupied the front benches here.

Those opposite sat here for 10 years and did nothing about it. It took a Labor government last time, and it's taken a Labor government this time, to address this issue. In fact, what they did the last time they were in office, after the 2013 election, was that, having said absolutely nothing beforehand, they introduced a so-called deficit levy on high-income earners, an additional tax which lifted up that top rate to the highest it has been in recent times. At the same time, they made cuts to health, cuts to education, cuts to the ABC and cuts to services. At the same time, the bloke who now wants to be Prime Minister came in as health minister and introduced a GP tax, or tried to—a tax on every visit to the doctor. He also tried to introduce a tax for every time people ended up at an emergency department, at the same time he was ripping $50 billion out of the healthcare system. There was no mention of that before the election.

What we have done here is to respond to the needs of our changing economy. Since five years ago, when the Morrison tax plan was put in place, there's been a global pandemic that had a long tail to it, there have been two conflicts—in Russia, with its invasion of Ukraine, and in the Middle East—and there has been global inflation, which has had an impact. Treasury and the Reserve Bank have indicated that those things have had a disproportionate impact on low- and middle-income Australians, and that's why we made not an easy decision but the right decision, done for the right reasons at the right time, to go to the National Press Club, having gone through all of our processes—the ERC, the cabinet, the ministry and our full caucus—and say: 'We are changing our position, and this is why. It's because people are doing it tough, and we want to do everything we can to provide support for the cost of living.'

This comes after the other measures that we've put in place: our energy price relief plan, our cheaper medicines, our fee-free TAFE, our cheaper child care. It comes on top of the measures that we've put in place to increase real wages—which have had an impact, with real wages increasing for two quarters in a row—including our support for an increase in the minimum wage in the last two national wage cases, which has had a significant impact on low-income earners. It comes on top of the 15 per cent increase in wages for the aged-care sector, in accordance with the recommendations of the aged-care royal commission. If you're an aged-care worker you've benefited from the increase in your wage to make sure that you earn more, and now you'll benefit from paying less tax on that increased amount.

Our approach has been to make sure that we deliver for working Australians, and indeed our package means that 84 per cent of taxpayers will be better off than they would have been had this legislation not been given support: 90 per cent of women, 98 per cent of young people, and overwhelmingly people in regional Australia. That is why the National Party member—the bloke elected leader not once but twice—has just come in here and gone on about how tough people do it in regional Australia. How about if they had a political party that stood up for them? The National Party won't, but we on this side of the House, the Labor Party, will stand up for people in regional Australia, which is what we are doing.

It is crystal clear that every taxpayer needs and deserves a meaningful tax cut, and that's what this legislation, the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024, will do. We want Australians to earn more and to keep more of what they earn. The coalition want people to work longer for less. A modest position that was carried just last week in this parliament, to allow for workers not to be punished for being on call 24 hours a day, seven days a week, is going to be overturned by those opposite. The truth is that, as technology has changed the nature of work, legislation must change with it. The government must respond to these changes in work practices. They won't interfere with any commonsense approach to these issues, which is why the right to disconnect is part of enterprise bargaining and a range of arrangements put in place between employers and employees. That's why the Fair Work Commission, under the legislation, will have a commonsense approach, essentially, to these issues. We know there are times when it's entirely appropriate for a worker to be contacted out of hours. What those opposite want, though, once again, is to just fail to move with the times. They just want the world to stop so they can get off. Well, they have got off—they've got off any responsibility from acting in a way that looks after working people and looks after their constituents.

Our position is also made possible by the fact that we have been fiscally responsible. It is what has given us the capacity to put in place those changes in child care and in health care, including the tripling of the bulk-billing incentive in Medicare, and our energy price relief plan that, all the indications are, put a significant downward pressure on inflation. We've put in place those measures whilst delivering the first surplus in 15 years and we've turned a $78 billion deficit into a $22 billion surplus, something that those opposite were never capable of doing.

They committed to having a position going forward in this parliament that would have left people behind and they have voted against all those cost-of-living measures, and now what we see is that they don't talk about it anymore. I may as well take a page out of the Bob Carr book of parliamentary leadership and bring a novel into question time, because we don't get any questions about the cost of living anymore. They never ask. They are completely distracted from any issue. They haven't put any other proposals. What they have done on tax—

If I knew this bloke's seat, I could comment back, but I'm not sure who he is, Mr Speaker!

Milton Dick (Speaker) | Link to this | Hansard source

Order! The Prime Minister will ignore the member for O'Connor's interjections.

Anthony Albanese (Grayndler, Australian Labor Party, Prime Minister) | Link to this | Hansard source

Thank you for that assistance, Mr Speaker. They stood up last weekend and they did a press conference. Having said that they would oppose and fight our tax cuts, they said they would roll them back absolutely—remember the words of the deputy leader? They then stood up and said: 'Well, no. Actually, we're opposed to it, but we're going to vote for it.' Then they said, 'But we're going to have our own tax plan,' and I thought, 'Beauty! Here we go! They're going to come up with a policy.' What was it? Nothing. Crickets. There was no alternative plan. They have an opportunity, of course, in the consideration in detail on this legislation to put forward some alternatives, and we'll wait and see what comes out of that. They have never had an idea to help Middle Australia. They are just concerned with, and their idea of aspiration is, people like themselves. It's people who have been pretty successful in life. That's their idea of aspiration.

What we on this side of the House understand is that every Australian aspires to a better future for themselves and their children. We will put in place measures that help them to achieve that better future for themselves and their children. That's what these tax cuts are about. Peter Dutton, as Leader of the Opposition, and those opposite just want people to work longer for less. That's the great divide in Australian politics. We want people to earn more and keep more of what they earn. They want people to work longer for less.

Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) | Link to this | Hansard source

I am pleased to rise to speak on the stage 3 amended cuts, which, as we know, will amount to about, on average, $804 per year or about $67 a month. If anyone had been listening to these speeches over the past couple of days they would think there were stories of two different worlds: on that side, a utopian existence where everybody is better off over the past two years; the promised land has been delivered. On this side: the reality of what is actually happening.

I was speaking to a young fellow the other day—in fact, my nephew, Matt. He is a good young fellow living in Newcastle who works hard, who has saved a deposit over many years for a house. He was looking for my guidance. Having listened to what has been put forward, the submissions by Labor—if you were to believe them—my advice would be buy in a Labor seat, because everything is better in a Labor seat. I have not heard one thing about the reality of what is happening, not one submission by Labor that the average person is paying $22,000 more in interest on their mortgage—$22,000! That is reality. Not one person across that floor made that submission. That is after tax on an average mortgage. Where does somebody find that?

Rob Mitchell (McEwen, Australian Labor Party) | Link to this | Hansard source

You must have a big mortgage.

Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) | Link to this | Hansard source

I take the interjection from across the floor: 'You must have a big mortgage.' Yes, people do. And I'm sure, to the member who made the interjection, somebody has a mortgage like that in your seat and you make a joke out of it—through you, Deputy Chair. These people are real, yet those opposite are talking about that. We're talking about that in our electorates. Where do you find an extra $22,000 a year when you are on an average income in my electorate of $65,000 a year before tax? The reality is you have to find a second job to cover your mortgage, and that is exactly what people are doing. That is exactly what people are facing.

Then you look at the groceries. I'm sure everyone in the chamber will be interested to know I do the shopping in my household. I enjoy it. I love it. I love comparing prices. I love to see what is on the shelf. I enjoy cooking. So every fortnight I prepare the list for the fortnight, do the meal plan for the budget, just like many people across Australia. Over the past 18 months to two years, my bill has gone up by at least 30 per cent. So if my bill has gone up 30 per cent—and we are not extravagant; we still have tuna bake Thursdays—it means everybody else's bill has gone up 30 per cent, but have we heard that from across the floor? No. Everything is rosy. There is not that cost-of-living crisis in the supermarkets. And what are the government going to do now? They are going to impose a biosecurity tax on our farmers. If you don't know what that is, it is a biosecurity tax on our farmers for what we are importing from other countries. We are punishing our farmers for what people overseas are sending here. Well, guess what's going to happen: you're going to pay more, because the farmers have no option but to pass that tax on to the consumer. If you thought it was bad now, with 30 per cent more on your grocery bill, wait until this tax is introduced and passed on to you—passed on to the mums and dads in regional and rural Australia. It is tough enough.

Then I move on to the cost of electricity. There's complete silence from the other side. Not one member did I hear. What I have heard is that your bills are lower, apparently—

Graham Perrett (Moreton, Australian Labor Party) | Link to this | Hansard source

The wholesale price has halved!

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

Order! The member for Cowper should not be encouraging interjections from the other side.

Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) | Link to this | Hansard source

Sorry, Deputy Speaker. I was simply making a submission that electricity bills have increased. Power is more expensive, and I have not heard the alternative from the other side. What I have heard is that, apparently, power bills have gone down by $125 per quarter. I defy anybody here, anybody in this place—

Rob Mitchell (McEwen, Australian Labor Party) | Link to this | Hansard source

Where did you hear that from?

Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) | Link to this | Hansard source

I'll take the interjection. It was the Minister for Indigenous Australians who made that submission, only this morning. You can go to Hansard and have a look at it. We have seen power prices increase by over 20 per cent.

I'll give you an example of a person in my electorate, in fact in my office, who went out and put solar on her roof because she was worried about the cost of electricity. Well, it's made no difference—absolutely no difference—because of the power prices. She hasn't got a battery—couldn't afford the battery. It's going back into the grid, but the cost of power is so high that it makes no difference to her. There are people out there struggling to pay their power bills, while people across the aisle are telling us, 'Your power bills are lower.' It's just not true. You know it's not true, but you won't admit it.

Then there's gas. The price of gas is up by 27 per cent. Plenty of people in rural and regional Australia don't have power to their place. They live remotely, so they rely on gas, with a 27 per cent increase in the price of gas. And now we've got state and territory leaders saying: 'We're actually going to force you to have gas in your house so we don't rely on coal-fired power stations. We're going to make you have gas elements in your house.' It's happening in Victoria. It's being floated in New South Wales. They're trying to put more pressure on people in regional and rural Australia by interfering, by entering your house and telling you what to do and how to live. The cost-of-living pressure keeps piling up, and what do we hear from the other side? Nothing—not one word about gas prices increasing by 27 per cent.

Then there's insurance. Insurance premiums are tripling, particularly in regional and remote areas. What is the government doing about this? Nothing. There's no intervention—'That's your problem; that's not our problem. We're going to give you $67 a month to deal with this. This is our big gift to you: $67 to cover the extra $22,000 a year on your mortgage, the increase in your electricity prices, the increase in your gas prices and the increase in your insurance prices, and that $67 will go a long way.'

Then there's petrol. When we were in government, the excise on petrol was 44c. It's now above 49c. On top of that, you have 18c in GST, so it's about 67c. Petrol was cheaper when we were in government and we cut the excise in half during COVID to give punters a break, because we knew they were doing it tough during COVID. And now what is this government doing? Nothing. They're not going to cut the excise in half. They've said so. When you're travelling around the city on the metro or on the trams, with short distances to work and short distances home, you're not concerned about the price of petrol. But in the regions, where you're driving 100 or 150 kilometres to work or you're on the road for work, it makes a huge difference—a massive difference—to what's in your back pocket, to the point where some people say, 'I simply can't do that job anymore, because I can't afford to travel that far.' Yet this government will not cut the excise. Six months, 12 months—give the people a break. Have a look at it. Be genuine. Don't stand up here and say, 'We're giving you $67 a month.' Sixty-seven dollars wouldn't even fill half your tank, and most people in regional areas go through two tanks a week. It's tough. Let's get real. Let's do something that really helps our people.

And then there's wages. According to those on the other side: 'You've never been better than under us. Your wages are going up.' The reality is that people are worse off by $8,000 a year. They're worse off and they know it, and they're telling the members opposite and they're telling the members on our side. But do we hear it from the other side? No. You've never been better off than under Labor, according to them. It is tough out there for these people.

I've heard over the past two days: 'We're giving you cheaper child care.' Well, you can't get into child care in the regions. There are waiting lists of 200 to 300 people. There are police officers and nurses swapping shifts and organising their diaries so they can look after each other's children. That is a fact. And people aren't able to go to work and make more money, because they can't get into child care. As for aged care, apparently in the city, if someone needs to go into aged care, you can just walk up and book them in. 'See you, Nan. We'll be back next week.' Good luck finding a position in aged care in the regions! The delusion that's coming from the other side that people are better off is just unbelievable. That may be the case in your seats, but it's not in the regions, because you don't think about those people in the regions.

Let me talk about telecommunications. What about 28 out of 28 telecommunication towers in the last round? Where did they go? They went to Labor seats.

Rob Mitchell (McEwen, Australian Labor Party) | Link to this | Hansard source

Wrong!

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

Order, Member for McEwen!

Rob Mitchell (McEwen, Australian Labor Party) | Link to this | Hansard source

He's misleading the House.

Pat Conaghan (Cowper, National Party, Shadow Assistant Minister for Social Services) | Link to this | Hansard source

I take the interjection. I defy the member to prove that, because eight out of those 28 were deemed inappropriate and not based on evidence.

This is almost like The Truman Show. Labor is almost like The Truman Show. They think that they're living in this perfect world, but it's completely scripted. It's completely untrue. What's going to happen is that the public, just like Jim Carrey, are going to realise that it's untrue and that they're living a lie under Labor. They're living an untruth and they'll want to get out of that world. And they'll find that door, and on the way out they'll say to Labor, 'Good afternoon, good evening and good night.'

Clare O'Neil (Hotham, Australian Labor Party, Minister for Home Affairs) | Link to this | Hansard source

I'm really genuinely so pleased to have the opportunity to contribute to this debate on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 and to talk about how our Labor government is going to deliver Albo's tax cuts and what this will mean for my Hotham community.

I have been a member of parliament now for 10 years, and, in that time, I have of course engaged frequently with my community, talking to them about issues that matter to them. Over those 10 years, whenever you do a street stall or you're doing your shopping in the supermarket, people come up and talk to you about what's going on for them. Usually, the things that they talk to you about are really varied. It'll be an experience they're having with a kid who's trying to get into the NDIS. It'll be something they're dealing with in the healthcare system. It'll be an issue that they're dealing with in early education. But I can tell you one thing for every member of parliament in this chamber: when we engage with our constituents today, we hear about the cost of living. That is the first, second and third order of priority, and there is daylight until the next issue gets raised with you.

We hear about it in a variety of ways. I talk to parents who just cannot afford to buy the groceries they need for their families. I talk to parents who are struggling terribly with rents and people who can't afford to fill their car up with petrol to go to work every day. These are real things that are really happening in my community in Hotham, and today our government is doing something serious and real to help those families, and I'm proud of that. I talk to my constituents, and they raise the cost of living, and they do it again and again. My message to my constituents today is: 'We hear you. Our Prime Minister hears you.' That's why we have re-engineered these tax cuts, and we are focussing those benefits on low- and middle-income households right across my electorate and our country.

I want my constituents to understand a few simple things about the tax cuts. The first thing is that every single taxpayer in Hotham will get a tax cut on 1 July, and 90 per cent of the people that I represent in parliament are going to be better off because of the changes that our Prime Minister has made. I hear derisory words around the parliament about what this will mean for families in my electorate, and I think it is snobbish and pathetic, because the truth is that a hundred bucks will make a huge amount of difference to some of the families in my community. When you put it together, we are talking about a lot of families in my community that will be thousands of dollars better off a year. Liberals born with a silver spoon in their mouths might find that that's not a lot of money, and for their constituents and some people in their communities maybe that's accurate. It's not for my community. Thousands of dollars extra in their pockets a month means a hell of a lot to families in my community that can't afford to buy groceries anymore. For a cleaner in Clayton, a nurse in Noble Park or a mechanic in Mulgrave, this is going to help them get back on track and pay the bills at the end of the month.

I've been a member of parliament for 10 years. It is not that often, honestly, that I can stand in this chamber and say that I am doing something good that will benefit every single person in my electorate. But today I can say that, and I can say that because of a decision made by our Prime Minister, and I'm really proud of that. A nurse who works at Monash hospital in Clayton will be able to keep more than $1,500 a year in that pay packet of theirs. A teacher living in East Bentleigh and working in one of our incredible local schools is going to be $1,400 a year better off. A truck driver living in Springvale South, who's getting up at the crack of dawn, getting behind the wheel and delivering food and logistics that we need all over our great state, will keep an extra $1,300 to make ends meet. An average family in my electorate will be twice as better off than they would have been under the coalition's tax cuts. That's the power of having a government that actually listens, cares and gets on with the job of making a change that will help the people we represent in this parliament.

We've had a pretty interesting sitting fortnight, and I think you are starting to see emerge two really clear pictures of the approaches that the two main parties of government have towards what's going on in our country right now. For the people who sit on the other side of the chamber, the Liberals and the Nationals, it's all about opposing things that might help the families we represent. It's all about trying to make people work longer for less. What we've seen is the ultimate contortionist operation over there with something that's going to benefit 84 per cent of people. A hundred per cent of taxpayers are going to get a tax cut, and the people who sit opposite me, who pretend to represent their constituents, contorted themselves into knots for weeks before they said that they would come forward and support the legislation. In fact, their instinctive response to this was to say: 'We're going to wind it back. We're going to increase taxes for people in the middle of a cost-of-living crisis.' It's absolutely ridiculous.

Don't forget what we're seeing on industrial relations, where we are making real strides and seeing real wages growth for the first time in a long time for families around this country. Again, the coalition comes in and says that they want to roll back the changes that we're making. One of the first things they're going to do is to roll back those changes. The Liberals want you to work longer for less; we want you to earn more and keep more of what you earn. As we go through the rest of this term in parliament, Mr Speaker, I think you'll see that increasingly played out in the public policy conversation.

Mr Deputy Speaker, I hope you won't mind if, on indulgence, I very briefly address another matter. We have had very serious natural disasters affect Victoria in the last couple of days. In particular, incredibly severe storms have ravaged the south-east of Melbourne overnight. I've been speaking with constituents in my community. There are trees down everywhere. Some of the houses are flattened, cars have been destroyed and, of course, the vast majority of my community is without power right now. My own household has lost power, and I only share that to say we're living that with you. My husband has been sending me pictures of the family eating dinner by candlelight. Their local school is seriously damaged.

I want to say something quickly to kids who lived through this yesterday in their classrooms. I talked to my son, who's in grade 2, and he described what was an absolutely terrifying experience of living through that storm in a classroom environment where the children were really upset and really scared. I just want to say to those children that I'm sorry that you had to go through that experience.

Please know that the federal government will be working closely with the state government to do everything we can to help support and protect our community and to help with what is going to be an absolutely massive clean-up for our south-eastern suburbs.

Finally, I say to our emergency workers, our police, our SES, our firies and our sparkies, who are trying to bring the power back online: we are so grateful for the work that you do. These incidents are really hard, but they bring out the best in Australians. I want to thank my beautiful community and just let you know that I'm here using the voice that you've given me in federal parliament. Thanks, Mr Deputy Speaker.

Mike Freelander (Macarthur, Australian Labor Party) | Link to this | Hansard source

I thank the minister.

Kylea Tink (North Sydney, Independent) | Link to this | Hansard source

As I rise to speak to the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024, I wonder how this moment will be seen in the future. As the member of North Sydney, I stand here in a unique position, representing the electorate that would have seen the largest amount of money delivered to people in a community under the original stage 3 tax cuts legislation. Indeed, it's not an understatement to say that when I was running for this seat many people were eager to understand where I stood on this issue. Did I believe the tax reform proposed under the prior legislation was the right reform? Would I fight to ensure the reform was delivered, and, ultimately, would I hold the government to account, ensuring that they delivered on what they had promised?

At that time, my answers were pretty straightforward. Yes, I believed the tax reform proposed was the right reform. We had already seen two of three phases executed, with each phase designed to address a specific perceived issue within the then tax frame. I'd spoken with Ken Henry, one of the brightest minds of our time in terms of good tax policy, and I was satisfied the removal of the 37c bracket would be good for a huge portion of the community. Yes, I would fight for tax reform. I believe a broad based review of our tax environment is long overdue and we cannot, as a federal governing entity, continue to rely on taxes generated by those who work. To do so is to risk disincentivising people to strive for greater. And, yes, I would hold the government to account should they not maintain their end of the deal. Yet here I am looking at a significant change that I honestly did not think would happen. Why would I? After all, this government and this Prime Minister had given me absolutely no reason to doubt that they would not follow through on what they had repeatedly identified as an unbreakable promise.

To be clear: under the current government's new plan, overall my electorate of North Sydney will see the largest reduction in personal income tax cuts from the modified stage 3 tax cuts compared to the previous proposal. At the same time, however, while the total amount of money flowing into my own community will be significantly reduced, the actual number of people receiving a tax cut will increase. The fact that both of these things can be true—that seven out of 10 individual taxpayers in the North Sydney electorate will now receive a bigger tax cut than they otherwise would have and that the economy of North Sydney will ultimately receive $77 million less than it otherwise would have—is where the quandary of this situation lies for me as North Sydney's federal member of parliament.

Every time I stand to speak in this place and every time I vote, I am conscious of the responsibility of bringing my community's true voice to this place, and this issue has been particularly vexatious for me. I cannot help but feel that it is absolutely imperative that the message I deliver here today is reflective of my community's desires, not just my personal thoughts. That quandary has driven me to actively seek to gather a full and accurate picture of North Sydney's views towards these changes. In this context, the picture I speak of today has been built up in a number of ways. In the first instance, it has involved me actively listening to hundreds of people. I did this at street meetings, through online surveys and through calls for input via the local media columns and via advertising in local papers. I've read hundreds of emails and digested every morsel of information I could gather from community forums, both in person and online.

Whilst I was getting a feeling that I had a clear picture of where the people of North Sydney stood, I was mindful there may be some whom I simply wasn't reaching. So, following the release of the government's proposed new legislation just over a week ago, I commissioned an independent research agency to conduct a representative survey of the North Sydney electorate. The research shows a strong majority of my community—indeed, over two-thirds, or 68 per cent—support the changes to the stage 3 tax cuts, with just 18 per cent opposing them. But, rather than me paraphrasing them, I'd like you to hear from them directly.

From a person living in Hunters Hill I heard this: 'I'm one of the very high income earners in Hunters Hill and I am so supportive of these tax cuts to help struggling families and support such people who work so hard to put bread on their families' tables.' Another, from a different part of my electorate, told me: 'The proposed changes give bigger cuts to those who need them most. It is not about breaking election promises. It's about sensible financial policy.' Yet another said to me: 'I'm concerned that Australia's inequality of income and wealth is getting worse. The proposed changes will go some way to redressing this matter.' But much of the feedback from those who support these changes can be best typified in the following comment, which I received from someone who lives in North Sydney. This person said to me: 'I am a professional businessperson and earn more than $200,000 a year. The stage 3 tax cuts were never sound tax reform. They favoured high-earning professionals and others, to the detriment of those who most need it—teachers and nurses et cetera.'

With all that said, while most of my community support the changes, some do not, and I do not wish to minimise them or allow them to be pushed aside as 'the greedy few'. Rather, many people have very legitimate reasons for being disappointed with this change in government policy, and some feel they've been blindsided, for, while they may be on what is considered a high income in this discussion, they are also frequently the primary or sole income earners in their families, and many are experiencing significant financial stress, either via increasing mortgage rates or through increased cost-of-living pressures. As an example, one person shared the following with me. They said: 'I earn just over $180,000 a year, and that means my husband, who cannot work for health reasons, is not eligible for government support. We have downsized our rental home twice in the last four years to help adjust our outgoings. The bottom line is, despite my perceived high income, as a single-income household, we do have to live to a tight budget, because $90,000 of my gross income goes on super, Medicare and tax. In terms of the anticipated 9K benefits from stage 3 tax cuts, they are simply no more.' Yet another offered to me: 'While I do support these changes, I just want to say I feel let down. I know that, according to the wider world, I'm considered rich. I earn over $200,000 a year, but I'm a single mum with three older children and I'm trying to help them finish their schooling. I rent a house where all four of us live and I'm trying to cover all of our living expenses, from insurance to groceries. Right now, once all of those costs are covered, I live on $16 a day. I understand that there are others in greater need and I want to be a bigger person, but I also do not want to feel bad about the fact that I'm disappointed.'

We cannot pretend that these tax cut changes will have no negative impact, because they will. There are people in my community who were counting on the promised tax cuts to keep up with mortgage repayments, school fees and rising grocery prices. Understandably, they're frustrated that they were told by this Prime Minister for so long that these changes would go ahead unchanged.

Ultimately, though, I think that it's not the broken promise that my community lament but rather the fact that they feel that they were misled along the way, because, to be clear, the majority of my community believe a strong government is one that does change policies to suit the times. In fact, three in five said that they believe it is acceptable for the government to make changes to the stage 3 tax cuts given the changing economic conditions and pressure on the cost of living, compared to less than a third who believe the changes amount to a broken election promise and undermine trust in government. Ultimately, my community believes this change makes sense for the time.

Looking at it through a local lens, the truth is that more people in my community will be better off under the proposed changes. Through an equity lens, nearly 90 per cent of all taxpayers will get either the same or a larger tax cut under the new plan. The changes proposed will promote greater equity and direct more support to those Australians who are doing it toughest. The Medicare levy adjustment will also go some way to providing relief to lower-earning Australians, but my community would encourage the government to consider providing more cost-of-living relief for those who do not necessarily benefit from these tax cuts—those on JobSeeker, age pensions and disability pensions—for the people of North Sydney believe we must take care of the most vulnerable in our community. Through a gender lens, 90 per cent of female taxpayers will receive a bigger tax cut under these changes. In this way, the government argues these tax cuts will directly benefit taxpayers in high-demand but lower-paid jobs with a high percentage of women, including teachers, nurses, aged and disability carers and childcare workers, all of whom will receive some tax refund under this scenario. And, through a fiscal lens, more than 100 economists and tax experts have called for changes to the stage 3 tax cuts, labelling the original tax cuts economically unaffordable and unfair. This included former ACCC chair Allan Fels AO, who said:

The tax cuts—

in their previous form—

would add to our inflationary woes, are fiscally inappropriate in light of major demands on the public purse, and unfair unless linked with wider tax reforms.

Finally, according to Treasury estimates, these changes will increase labour supply by around 930,000 hours, more than double the labour supply benefit from the previous stage 3 tax cuts.

Looking at it in this way, then, it would appear this changed legislation is better for the times we find ourselves in, and I believe that is why the majority of North Sydney people support the changes. They are fairer, more equitable and more fiscally responsible than what was previously proposed, and these are the principles that my community values.

But I also take this moment to put the government on notice. If you want my community to trust you, you need to be more forthcoming with your thinking. You need to treat my community with respect. We do not expect that all the conversations will be easy, but we do expect to be given an opportunity to contribute to them. We do not want to find ourselves stereotyped as those who have more and therefore can afford to pay more. From the outside, it's always easy to imagine that someone has it easier than someone else, but please do not lose sight of the fact that we are people just like all others, working hard to build a better world for our children and their children. We do not want you to lose sight of the fact that we are also fighting hard to maintain a diverse and cohesive community where essential workers can afford to live near where they work and young people can aspire to raise their own families in the communities in which they grew up. Ultimately, we will welcome this change to deliver bigger tax cuts to more Australians, but please know that the lack of transparency from the government in making these changes has impacted people in a very real way.

The debate around stage 3 tax cuts has highlighted just how overdue this country is for a total and holistic review of our entire tax system. It is clear we need to find other revenue streams and opportunities aside from income tax, like taxing multinational companies, windfall profits and carbon emissions. A much bigger conversation about tax needs to happen in this place, and it is imperative that this change stop being positioned as reform. It is not. It is a change from what was previously promised; it is not significant reform. A conversation about tax reform that is based on clear principles, incentivises the things that we want and disincentivises or taxes the things we do not must take place. We must also, though, always be mindful of encouraging and rewarding ambition and hard work, and we ask you to be mindful that, as the only other Independent to hold this seat, Ted Mack, was renowned for saying:

… the very basis of democracy is that a decision taken by the public as a whole will be right more often than decisions taken by an elite group …

We expect to be part of the conversation, and we welcome the opportunity in the future.

Julian Hill (Bruce, Australian Labor Party) | Link to this | Hansard source

The Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 will deliver a tax cut for every Australian taxpayer. That's all 13.6 million taxpayers, not just the select few as under the proposal of those opposite. The 19 per cent rate will be cut to 16 per cent and the 32½ per cent rate cut to 30 per cent. For the 37 per cent rate, the threshold will be raised from $120,000 to $135,000, and for the 45 per cent rate the threshold will be raised from $180,000 to $190,000. It is actually the first increase in the threshold since Labor was last in office. A tax cut for every Australian taxpayer is something every member of parliament should vote for. But we'll wait to see what happens when we get to the vote, given the conflicting, confused, chaotic response of those opposite.

In my electorate 89 per cent of taxpayers will be better off under Labor's tax cuts than under the Liberals' proposals. People in Dandenong, Doveton, Dandenong North, Noble Park North, Noble Park, Eumemmerring, Hallam, Narre Warren, Narre Warren North, Narre Warren South and Endeavour Hills will be better off under Labor's proposals. Every taxpayer will get a tax cut. Eighty-four per cent of Australians nationally—11½ million taxpayers—will be better off under Labor's tax cuts than under the Liberals' proposals. All taxpayers earning up to around $150,000 will be better off under Labor's tax cuts than under the Morrison government's proposals. Nurses, teachers, truckies and care workers get a bigger tax cut under Labor than under those opposite.

It is important, given the significant fiscal impacts of this bill to reflect on why Labor's tax cuts are needed and why this is the package, why this is the right plan, right now. It's part of the government's economic plan to allow Australians to earn more and to keep more of what they earn. Now, there's no magic bullet, of course, to the cost-of-living crisis and the pressures people are under. I represent one of the most disadvantaged parts of the Melbourne metropolitan area in south-east Melbourne. Indeed, I think the biggest—what's a synonym for 'hypocrite', because I can't say that—

Graham Perrett (Moreton, Australian Labor Party) | Link to this | Hansard source

The coalition?

Julian Hill (Bruce, Australian Labor Party) | Link to this | Hansard source

The coalition—indeed! Thank you, Member for Moreton. The biggest frauds opposite are actually the National Party MPs who represent some of the poorest, most disadvantaged electorates in the country. Their voters—their electors—will overwhelmingly be better off under Labor's tax plan than the one they've been advocating. But there is no magic bullet to the cost-of-living pressures people across the country are under. Labor's tax cuts come alongside our cost-of-living relief—cheaper child care, cheaper medicines, energy price relief, the biggest increase to rent assistance in decades, more Medicare bulk-billing, expansion of paid parental leave and a boost in income support payments for the most vulnerable in the community. The tax cuts complement those measures by allowing people to keep more of what they earn.

Cost of living is about money in, money out. Unlike those opposite, the government has an explicit agenda to get wages moving. We've finally had some good data on that. Wages are growing at their fastest rate for 15 years. We've had two consecutive quarters of real wage growth. Of course, the decade of decay and dysfunction and division of those opposite—the Abbott-Turnbull-Morrison horror show—saw real wages in this country go backwards. And they can't blame COVID. Real wages were going backwards even before COVID on their watch. It was part of their deliberate design feature of economic management, as Mathias Cormann, the former finance minister, admitted in a rare moment of honesty on a television interview, where he said, 'Well, of course, low wages are part of our deliberate design feature of what we try and do.'

We have the opposite philosophy. The Labor Party wants to see people earn more and keep more of what they earn, and that's what these tax cuts are about. Importantly, though, they're not inflationary. Without a doubt, inflation is the central economic challenge the country has faced last year and this year. Inflation—when prices rise faster than wages—hurts low- and middle-income earners the most. Anyone with a sense of economic history who is old enough to remember what has happened to other countries around the world, who is old enough to remember the crises in decades past, knows that tackling inflation and getting inflation under control has to be the central focus of any government. If it isn't then we see more interest rate rises. The government has to carefully design tax cuts, carefully design cost-of living-relief, so as not to make the problem worse.

But the right thing to do when your country faces economic circumstances is to change your economic policy settings and that is what we on this side are doing with these redesigned tax cuts. The right thing to do is not to sit around and wring your hands and say, 'People are doing it really tough. That's bad, isn't it? I wonder what will happen?' or 'I don't know; we will give ourselves a $9,000 tax cut—which is what the Liberals' wanted; that was their proposal—while everyone else gets nothing.' That is not on. These tax cuts are good for workers, they are good for families and they are good for the economy.

But it is important to reflect. We have put our case. Overwhelmingly, the feedback from my community and across the country is Australians support Labor's tax cuts. Why all the screeching and shouting from those opposite over the last few weeks? It has been truly bizarre. It has revealed what a confused rabble they really are, if you didn't see it on television over the last couple of weeks on Nemesis. It is absolutely clear from everything they have said that the Liberal and National parties want to vote against tax cuts for low- and middle-income earners.

I will read the quotes. The shadow Treasurer said: 'Of course, we are going to try and stop it. A move away from the stage 3 tax cuts will not be something we can support.' Their Churchillian deputy leader said: 'When this legislation hits the parliament, we will fight it. We will fight it all the way. I am digging in along with my colleagues and our leader, Peter Dutton, to fight this really hard. We will fight this legislation through both the House of Representatives and the Senate. We're not prepared to give up on this.' Well, that lasted a day. Her position was her commitment to rolling back tax cuts. That was absolutely her position. The opposition finally had a policy. It was to raise taxes on 84 per cent of Australians. That was their brilliant genius policy they were going to take to the next election. That lasted a couple of days. Senator Canavan said, 'I don't support the government's change and broken promises on tax.' Then their leader, Mr Dutton, intervened to try and referee the family fight. He said they wouldn't oppose Labor's tax cuts.

It is clear as mud because over last week the shadow Treasurer was interviewed by Natalie Barr. She asked him, 'Do you want more support for the lower end?' The shadow Treasurer said 'No'. David Speers asked him, 'You promised to keep these stage 3 tax cuts, of course, and now you are supporting their changes?' The shadow Treasurer said, 'No, we're not.'

The opposition's position is incoherent, inconsistent and a shambles. This debate has revealed them as frauds. They love to say, 'Tax cuts are in our DNA.' It is part of their brand schtick and propaganda. The only problem with that is these inconvenient things called facts and economic data. The two highest-taxing governments, certainly while I have been alive—50 years—in decades have been: No. 1, John Howard and, No. 2, the Abbott-Turnbull-Morrison governments as a percentage of tax to GDP ratio. That is the accepted measure. On any measure, when you look at it, Labor is a lower taxing party of government, and these tax cuts under Labor are fairer and better for the economy. The last time the top tax threshold was actually raised was under prime ministers Rudd and Gillard.

The first instinct of those opposite is always to oppose tax cuts and cost-of-living relief for low- and middle-income earners whilst trying to give themselves a $9,000 tax cut. It is the fundamental core point of the Liberal Party, isn't it, when you go right back through Australian political history, to protect people who have the most in society, whether that is wealth or income. If anyone is confused by this, watch what they shriek the loudest on. They shriek the loudest when you try and look after low- and middle-income earners and they shriek the loudest when you change laws to try and give workers a better deal; that's what really triggers them.

Another reason why they should support Labor's tax cuts is because they will overwhelmingly benefit women. This is a really important point. Labor's tax cuts will put more money back in the pockets of Australian women. In particular, they're good for the economy because, as the Treasury analysis shows, in cutting the 19 per cent tax rate to 16 per cent they provide a greater incentive for people, particularly part-time workers, who are overwhelmingly women, to pick up an extra few hours or an extra shift. The estimate is that there will be hundreds of thousands more hours worked in the economy because of the tax cuts. They're good for the economy, good for labour force participation, allowing people to keep more of what they earn.

Under Labor's plan, women taxpayers will, on average, receive a tax cut of $1,649 from 1 July. For 90 per cent of Australian women, that's bigger than under the Morrison government's plan. Childcare workers, disability carers and aged-care workers are some of those most likely to benefit, with more than 95 per cent of those taxpayers to receive a bigger tax cut than under the Liberals' plan. The government has done the gender analysis. As I said, it's overwhelmingly women who are in part-time and lower paid professions. A childcare worker in Dandenong, a receptionist in Noble Park North, registered nurses in Doveton, an office clerk in Eumemmerring, an office manager living in Narre Warren, a primary school teacher from Narre Warren North, an aged and disability carer from Berwick, an accounting clerk from Endeavour Hills, a nurse or personal care worker living in Hallam, a check-out operator living in Dandenong North, a general administrator living in Lysterfield South—all of these workers, overwhelmingly women, will be better off under Labor's plan. It's better for the economy and the labour market than the Liberals' plan.

My best advice to those opposite—free advice, take it or leave it, and as I say this I reflect that there are no women on the other side of the chamber; we have at the table the Minister for Early Childhood Education and Minister for Youth, the member for Cowan—is to stop the equivocating and back Labor's tax cuts. They're good for the economy, good for every taxpayer and especially good for women. This is so important, because we know those opposite have a problem with women. Their Senate leader—not some baked, has-been leftover but the Leader of the Opposition in the Senate, one of their big four—went on the television this week and said, 'Looking back, I can see that the absence of women, other than Julie Bishop, in the cabinet at the time, and the commentary around that, was a symptom of problems that were to come to dog us more fundamentally in an electoral sense in years to come, and to this very day.' 'In an electoral sense'—it's actually always about the politics, not about diversity in decision-making or having all views represented at the cabinet table.

Senator Reynolds, who's still there, though she's announced she'll be retiring at the next election—to spend more time with family or spend more time with the lawyers, who knows?—said:

I think it said to all of us that women weren't really valued enough to be selected into the ministry, and in particular into cabinet.

It certainly didn't send the right message.

But perhaps the most astounding thing was that Australia's former top public servant, Martin Parkinson AC, who was the Secretary of the Department of the Prime Minister and Cabinet—

Graham Perrett (Moreton, Australian Labor Party) | Link to this | Hansard source

Very respected.

Julian Hill (Bruce, Australian Labor Party) | Link to this | Hansard source

Incredibly respected, an economist and the most senior public servant in the country, who'd served both sides of politics, went on the television to say that the former Prime Minister—

Ross Vasta (Bonner, Liberal Party) | Link to this | Hansard source

Order! Member for Bruce, could you stay on topic. This is straying way out of the Treasury laws amendment bill. I think you're starting to make commentary—

Julian Hill (Bruce, Australian Labor Party) | Link to this | Hansard source

Well, I'd reflect on some of the comments from those opposite. I'm making the point—I'll bring it back to the topic—that it is incredibly important that those opposite vote for these tax cuts because they're better for Australian women. We know that's difficult for them—and that's the point that I'm making—because they have a problem with women, as their own senior members say. The former head of the Public Service in Australia went on the television and said the former Prime Minister, Scott Morrison, never valued women's perspectives.

The worst thing about all of this, Mr Deputy Speaker, is that it's never about the Australian people, never about good economic policy; it's always about the politics—as member after member from the former Liberal horror show went on television and told the Australian people. The only thing worse, of course, than the former Abbott-Turnbull-Morrison governments are the leftovers, those who are left behind who still hate each other and are an incoherent rabble. As I said, the quotes I read out are directly relevant to the question. Who knows how they'll vote? Their shadow Treasurer and deputy leader are busily saying, 'We don't support tax cuts for low- and middle-income earners; we'll roll them back at the next election,' while the leader tries to say, 'We'll vote for them but we don't support them.' It's an incoherent, inconsistent, nonsense position. I encourage them to get with the program and vote for Labor's tax cuts.

Llew O'Brien (Wide Bay, National Party) | Link to this | Hansard source

I rise to speak on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024. Obviously, in this place we make a lot of big decisions that affect people. Some are smaller than others, but one thing about tax law and taxation is that it strikes at the heart of most people's family budget, and it's something that we need to take extremely seriously. I just don't think that is happening on the other side. I really don't. I think, when it comes to this plan that the Labor Party has effectively cooked up on short notice, it isn't well considered. If you believe the Prime Minister, who's been telling us up until five minutes ago that there was no plan to change the stage 3 tax cuts, it's very hasty in its being brought forward, and it's ill considered. I'll go on to explain what I mean by that.

Of course I'm in favour of income tax cuts. They effectively give people their own money back. When you go for a job, and they tell you what your wage is, they don't tell you the amount after tax; they tell you the amount before tax, because that's your money. You're earning it. When you pay tax, the government takes that off you. Any legislation that comes before this House that looks to give people more of their own money back I'm naturally going to be in favour of. But it's the basis upon which these changes are happening. I certainly won't stand in the way of people getting more of their own money back, but I do think, under the circumstances and in the current economic climate, there is a better way of doing it. I don't think anyone likes paying tax, straight up. A lot of people give their altruistic views on taxation and it being a wonderful thing. I think it's a necessary evil, and I don't think people actually really do like handing over money to the government.

Certainly, taking more income tax off of people is one of this government's key achievements. Indeed, 27 per cent more income tax has been going into the economy under the Albanese government in the last 18 months. A 27 per cent increase in personal income tax under this government is quite extraordinary, really. That's before you start looking at the 10 per cent GST on the goods and services that are absolutely going through the roof with this current cost-of-living and inflation crisis that has been 100 per cent brought about by the policies of the Albanese government. People are paying a 49 per cent excise every time they fuel their car up. That's only going to become worse, with transport costs that will go through the roof under the new policies that have been brought forward by the Labor Party, which will see electric vehicles and hybrids forced into the market and onto people who can't afford what will be a major increase in cost to purchase a vehicle.

People are already paying excise on beer and wine, and tobacco is going through the roof. There are the policies around tobacco, which they're gouging more and more out of. They're not only failing on a health basis, because all we're seeing is illicit tobacco shops popping up all over the place. It's an absolute disgrace what this government is doing in terms of their economic management. Labor talks a big game on middle-income and low-income relief. But we've got to remember it's the coalition who have already delivered $40 billion worth of tax relief to low- and middle-income earners in their three-stage plan, of which the Labor government are certainly changing the third stage, which they initially agreed to and promised the Australian people that they wouldn't change. But $40 billion has already been returned to taxpayers.

Stage 1 provided tax relief to low- and middle-income earners earning up to $90,000 by raising the 32.5 per cent tax rate threshold and introduced a low- and middle-income offset. That was a key piece of policy that was designed to help people in a cost-of-living crisis. It was something that could be implemented at short notice, something that wasn't permanent but could be directed at those who needed it most at the right time, unlike this structural change that is certainly not going to be in the long-term interests of Australian taxpayers and the economy.

Stage 2 increased the 19 per cent rate threshold from $37,000 to $45,000. The 32.5 per cent rate threshold was raised from $90,000 to $120,000, and the low-income tax offset increased from $445 to $700, with low-income earners eligible to receive both tax offsets.

Stage 3 would have simplified and flattened the system by removing the 37 per cent tax bracket completely. That was a very important piece of legislation that would have addressed bracket creep. Those people in the middle-income range, hardworking Australians who are not rich by any stretch of the imagination, are being pushed into that next tax bracket and paying more tax through bracket creep, and that has certainly contributed to that massive increase of 29 per cent income tax that has been taken from hardworking Australians by the Albanese government.

That was the plan—in stage 3, we were getting rid of the 37 per cent tax bracket completely. That 37 per cent tax bracket really needs to be known as Prime Minister Albanese's tax bracket, because he owns that from here on in. That is his tax bracket. When hardworking Middle Australia are paying 37c on the dollar instead of 30c on the dollar, they can say, 'Thank you, Prime Minister Albanese, for making me pay more tax.' It shouldn't come as any surprise, but it is the case.

The low- and middle-income tax offset gave people back $1,500. That was the offset that we put in place in the coalition. The offset was removed by the Albanese Labor government in 2023, and the government now says that it will give these low- and middle-income earners about $800 back instead. We were giving them $1,500 as targeted relief in a cost-of-living crisis, and the Albanese Labor government, which is spruiking that it's making these wonderful changes, is giving back $800 as opposed to our $1,500. That's $15 a week, which won't go very far at all when you think about it.

We are living through a cost-of-living crisis. This government is failing badly when it comes to that. They will tell you that they are implementing all of these policies that are helping with the cost of living, but I ask you simply: Do you feel like you are paying too much for your goods? Under this government, have you felt like you are paying less? I think I know the answer to that, and the answer is a big no. People are paying more under Labor, and that is a fact.

The other aspect to this is the politics around this. Yes, there are some people, as I said before, who will receive more of their money back, and we won't stand in the way of that. But there is a big cohort of people who won't who are not rich. We've heard all of these television gibes throughout the week from the other side, but this is like an old repeat. This class warfare of envy is attacking Middle Australia.

I know frontline emergency service workers who are going to have money taken off them by the Albanese government. I was talking to one the other day. This person is somebody the Albanese government has decided is not worthy of the tax cut that they were going to get. This person goes to the most horrendous domestic violence incidents and puts their life on the line to help others in their community. This person is in a particular tax bracket not necessarily because of aspiration but because of a sense of duty. Particularly in Queensland, where the Labor government has mismanaged things so poorly, there are people working in public services that are very understaffed. They're not taking on overtime because they want extra money. They're doing it because no-one else will. That's what finds them going into these tax brackets that the Albanese government has decided it's okay to take money off. These are people that are serving their community on the front line and they're being labelled as rich and as not feeling cost-of-living pressures. That's absolutely absurd. The government should hang their heads in shame for engaging in that sort of thing.

To add insult to injury, this government is taking money off hardworking Australians and it's blowing it, with government waste like you would not believe. The greatest example, so far, of many is the referendum we had that cost $450 million. The government said, 'We're going to take this money out of your pay packet, hardworking Middle Australia, and we're going to spend money on things like a referendum.' It was an ill-considered referendum which should have been a moment of unity for our nation but did nothing but cause division. The government said, 'We're going to waste that $450 million, but we're going to take it out of your pay packet, hardworking Middle Australia. We're going to bury a billion dollars worth of Taipan choppers instead of using those assets more prudently. We're going to have a Prime Minister that decides he's going to fly around the world in the VIP jet but wants to talk about hardworking Middle Australia, who he's taking money off with these tax changes.' He's blowing money, left, right and centre. It's an absolute disgrace—it really is.

The good news is that after the next election we will, hopefully, have a different government that makes decisions in the interests of both the economy and the taxpayers who add to that economy. We will have a government that makes long-term decisions that will look further into the future to help Australian taxpayers and that will bring about changes that address bracket creep. We will have a government that will stop waste. We will have a government that looks after hardworking middle Australians, who are characterised by this government as rich snobs who don't deserve a tax cut. That government will, hopefully, be a Dutton government, and I will certainly be proud to serve as part of that government.

Amanda Rishworth (Kingston, Australian Labor Party, Minister for Social Services) | Link to this | Hansard source

I'm very pleased to speak in this debate. I was listening to those opposite, and they were very forthright in their objections to these tax changes, which are bigger, better tax cuts for more Australians. So I was a little confused about why they are voting for these tax changes. They had the opportunity to get up, put a stake in the ground and show their opposition to these tax cuts, but, of course, they haven't done that, because, despite their rhetoric and what I think is a lot of hot air, they actually know deep down that these tax cuts are tax cuts for Middle Australia, they are tax cuts that support aspiration and they are tax cuts that give every single Australian a tax cut. If they didn't know or believe that, surely they would vote against these tax cuts, but they are choosing not to. They are putting a stake in the ground and saying, 'We support the government's tax cuts.' It would be nice if these quite contradictory positions were explained a little bit more in this debate, but I'm not going to hold my breath.

I am very pleased to speak in favour of the tax changes put before the parliament, because the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 will provide a tax cut to every Australian taxpayer. Our No. 1 priority as a government is helping Australians with the cost-of-living pressures. From 1 July, the government is delivering a tax cut, as I said, for all taxpayers, which will provide meaningful and immediate cost-of-living relief up and down the income scale without adding to inflation. All 13.6 million taxpayers will receive a tax cut, and 2.9 million more taxpayers will receive a tax cut compared to the previous government's plan. Eleven point five million taxpayers—that's 84 per cent of taxpayers—will now receive a bigger tax cut compared to the previous government's plan. Our tax plan includes increasing the Medicare levy low-income thresholds, meaning that 1.2 million low-income earners will get additional tax relief on top of the tax cuts that the government is legislating.

Of course, the Albanese Labor government's tax cuts are better for workers and families and better for Middle Australia and communities right around Australia. This includes social and community services workers, who deliver a range of programs in my portfolio of Social Services, including services for people with disability, carer support services, initiatives to reduce violence against women and children, and other family and community supports. Our tax cuts mean that a full-time social and community service worker earning $75,000 will receive a tax cut of $1,554. This is double the tax cut that they would have got under the previous government. The rhetoric coming from those opposite would suggest that they disagree with this person getting double the tax cut that was otherwise planned. The rhetoric that we are attacking Middle Australia suggests that this worker on $75,000 should not get double the size of tax cut. Well, we think that this worker, along with all other Australian workers, should be able to keep more of what they earn. A part-time disability support worker earning $40,000 will receive a tax cut of $654, once again keeping more money in their pocket. Under the previous government's plan, this worker would have got no cost-of-living relief. So I am really pleased that, as a result of this government's tax plan, community service workers will be able to take home more of what they earn to help with cost of living. My portfolio and, indeed, many other social services would not be able to deliver these programs without the dedication of workers who touch lives every single day, particularly the lives of vulnerable Australians doing it tough.

Not only are our tax cuts particularly good for Middle Australia but they are also particularly good for women. All 6.5 million women taxpayers will receive a tax cut, benefiting by an average amount of around $1,650. Of course, 90 per cent of female taxpayers will receive a bigger tax benefit than otherwise was planned by the previous government. More than 90 per cent of taxpayers in essential and high-demand occupations, many of which have a high percentage of women, will receive a bigger tax cut. This includes teachers, nurses, aged-care workers, disability carers and childcare workers. Our tax plan will ensure more women keep more of what they earn and will help parents who are returning to work. Increases in take-home pay will also create opportunities for women to take on more hours, and we've seen in the modelling that this will boost labour force participation.

The government's tax cuts complement continuing reforms to address women's economic inequality by closing the gender pay gap, supporting workplace flexibility and security and rebalancing unpaid care work. Of course, I'm here particularly as the member for Kingston, and I am really pleased that the workers in the southern suburbs of Adelaide will get to keep more of what they earn under Labor's tax plan. There are 75,000 taxpayers in my electorate, many in the health area. There are care workers, tradies, technicians and office workers. They will all receive a tax cut, and 90 per cent of these taxpayers will receive a bigger tax cut than they would have received under the previous government's plan. Once again, what the opposition is saying is that those people don't deserve a bigger tax cut. Workers in my electorate, in all those different professions, deserve this tax cut to support them with the cost of living.

Our tax cuts complement the significant other cost-of-living relief measures that the Albanese Labor government has provided, particularly for those Australians on low incomes. In the last budget, the government announced an increase to the working age and student payments, which commenced from 20 September last year. This additional support has been flowing, along with indexation increases of the relevant payments. Since Labor took government just over 18 months ago, the base rate for JobSeeker has increased by 17 per cent in less than two years. The government has also delivered the largest boost to Commonwealth rent assistance in over 30 years to help people on income support, pensioners and low-income families cover the cost of rent. Around one million households are better off up to $36 per fortnight, including indexation and depending on their household type.

Importantly, this has not only provided cost-of-living relief but has helped to moderate rent increases. This is an example of smart government policy that is delivering direct cost-of-living assistance but is not adding to the inflation challenge, and that has been keenly felt. In fact, the opposite is happening, and this measure has moderated rent rises. Whether it is strengthening the safety net, providing electricity bill relief, providing cheaper child care, tripling bulk-billing or providing cheaper medicines, the Albanese Labor government is doing a whole lot to help people with the cost of living.

As we've heard from those opposite, it's pretty clear that those opposite do not want these tax cuts for Middle Australia, just like they didn't want to see an increase to JobSeeker or provide electricity bill relief. What has been pretty stark is that those opposite clearly have no alternative plan. They oppose our bigger, better tax cuts to Middle Australia but are voting for them. It is clear that they absolutely have no plan. It is hard to understand their position on this, because their position has been changing quite a lot. On the first day, they were going to roll them back. On the second day they weren't going to make a decision until they'd seen the legislation. Then I think the shadow Treasurer equated the cuts to Marxism and said they would fight us every step of the way. Now they're voting for them. You could not contort yourself in as many different positions as those opposite have done when it comes to these tax cuts. But that is because this opposition are full of negativity. They're full of negativity. They're full of saying no. They have no plans for the future. There's so much negativity that they've spent how many days arguing against tax cuts that they are actually going to vote for. The Australian people can see this posturing for what it is: the cynical politics that we are seeing from those opposite.

Our government has taken the responsible action. Economic circumstances have changed and, as a result, we've adjusted our policies to meet those economic circumstances. We have been very, very clear that we want to support Australians with the cost of living, and ensuring we have a bigger, better tax cut has been important in that and in ensuring that our policy on tax does not add to inflationary pressures.

This is supported by Treasury advice, which stated the tax system is an effective way of providing cost-of-living relief without putting extra pressure on inflation. That is what the Treasury has said about our tax cut plan. Importantly, our tax plan puts Australians first. It will provide meaningful cost-of-living relief for everyday Australians in a responsible way that doesn't add to inflation.

While we see those opposite contorting themselves—will they, won't they, will they roll it back, won't they?—I look forward to seeing their tax plan, which we hear is going to come one day—one day it's going to come! I look forward to seeing the merits of that, but, based on the quality of this debate, I'm not going to hold my breath. I'm not sure we're going to see something from those opposite that is well thought through and is right for our economy.

This government will get on with doing what's right for the economy, but, most importantly, what's right for the Australian people, what's right for Middle Australia, because they deserve cost-of-living relief, and that's what we're delivering. I commend the bill to the House.

Gavin Pearce (Braddon, Liberal Party, Shadow Assistant Minister for Health, Aged Care and Indigenous Health Services) | Link to this | Hansard source

There has been a lot of focus recently on the Albanese government and their broken promises. This government promised to leave no-one behind—'no Australian behind' they said. Their promise was to hold no-one back. Their promise was to use the great privilege of government in order to make positive differences to the lives of Australians. These were promises that they made to Australians over and over and over again. Now, 18 to 20 months later, there is no doubt at all, absolutely none, that Labor have failed to deliver on their promises. Households and families in my region in the north-west, the west coast and King Island in Tasmania, families from across Tasmania, families from across the nation have never done it tougher.

The coalition successfully guided this nation through the biggest health and economic crisis in living memory. We handed the reins over to the Albanese government in 2022 and the wheels have invariably fallen off the cart. The latest food hunger report from Tasmania is alarming. In the past 12 months—and these are facts—84,000 Tasmanian households have experienced food insecurity. Let's just think about that for a moment. Let's just think about what it's like not having the means, the confidence to provide a simple meal for your family. In the 12-month period just gone, 84,000 households in Tasmania experienced food insecurity. This is 18,000 more households, more families, than in 2022. Imagine what that's like for a moment. The No. 1 reason Tasmanians are struggling to meet their food needs is because of Labor's cost-of-living crisis. Eighty-seven per cent of Tasmanians say that the No. 1 reason for their food insecurity is the cost of living.

We need to be clear about the reason for this bill from the outset. What is the purpose of the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024? It's certainly not a long-term economic plan. It came about just a few weeks ago. That's when a desperate prime minister called every member of his government to Canberra for a special crisis meeting—at great expense to the Australian taxpayer, might I add. This side has been telling this government and the Prime Minister that Australians are going to the wall. They're not doing it well; they're doing it tough. Australians are being left behind. Australians are being held back. We've been telling this government for 18 months, but they've refused to listen. So what was the purpose of the dash to Canberra and the crisis meeting? It wasn't about the cost-of-living crisis. The meeting was about what Labor believed to be a political crisis—the looming by-election in Dunkley, no doubt. They hatched a cunning plan. It was a plan so cunning you could put a tail on it and call it a fox. It involved most vulnerable Australians, giving them a pat on the head and 15 bucks in their pockets. But we'll kick that down the road in about five months time. They won't see anything in their pocket for approximately five months. They're hoping that in that time they'll win that by-election in the seat of Victoria. This government is not about people. It's just about politics, and that's what this bill is all about.

So how much has Labor's cost-of-living crisis cost us? Around 45,000 taxpayers across my electorate of Braddon in the north-west, West Coast and King Island will get a tax cut from 1 July. They will. If you earn around $50,000 you'll get around $15 a week under Labor's plan. If you earn around $73,000 you'll get $14 extra. Labor MPs have been rising in this place, telling us how generous they are and patting Australians on the head and giving every Australian an extra $15. Tell those families who can't feed their families at home and are lining up at welfare outlets in order to get a meal. Tell them what $15 does for them. What they should be doing is standing up and apologising for not meeting their promises to their electorates. This is a government that's giving $15 in order to compensate for the thousands of dollars, and in many cases tens of thousands of dollars, that Australians are worse off because of their economic mismanagement. It's shameful.

As I'm out and about in the electorate, on the ground listening to people, they've been telling me that the No. 1 issue that's holding them back is Labor's cost-of-living crisis. No-one is immune from it. Regardless of your tax bracket and irrespective of whether you are an employee or a business owner, Labor's cost-of-living crisis does not discriminate. It's hitting everybody, and it's hitting harder and harder and getting worse and worse. Parents are now making really tough choices about getting their kids what they need to return to school, because Labor's rising cost of living is biting into everything that they touch.

Under the Albanese government, Australians have seen the largest fall in living standards of any advanced country in the world. There have been 12 interest rate increases under this Labor government. Housing costs have risen. Mortgage payments have risen. Rental costs have gone up. Real wages have gone backwards. In fact, they've gone backwards by six per cent. Labour productivity is in absolute freefall, with a 6.7 per cent reduction in labour productivity since Labor came to government. When Labor talk about how they're growing the economy, the economy is growing only because of a rapid population growth. Almost half a million people have immigrated to this country in the past 12 months. For the past two quarters, the GDP per person has gone backwards, and yet those opposite believe that they should be congratulated. We should blow whistles and throw streamers for giving the most vulnerable $15 a week. It's an absolute joke.

The average household with a $750,000 mortgage is paying an additional $24,000 a year in mortgage repayments. This is a government that promised a $275 reduction in electricity prices, but we've seen electricity prices increase by 18 per cent, the complete antithesis of what they promised. Gas prices have gone up by 28 per cent. Food has gone up by 8.2 per cent. Rent has gone up by 10.4 per cent. The cost of insurance has increased by 17.3 per cent. The price of everything that we touch is going up for hardworking Australians. But Labor thinks it's okay if we give them $15 a week, pat them on the head and tell them how great they are. Well, it's not going to cut it—taking Australians for mugs.

It's important, when discussing Labor's alteration to the stage 3 tax cuts, that we tell the full story. In order to tell that full story, we must consider what the coalition introduced, the full suite of tax cuts, specifically aimed at helping low- and middle-income families. We are the government of lower taxes. Under a coalition government, stage 1, stage 2 and stage 3 tax cuts were legislated. Stages 1 and 2 were specifically targeted at people on low and middle incomes, and stages 1 and 2 were delivered as promised, because we stick to our word. The coalition's economic plan delivered $200 billion worth of targeted tax cuts to low- and middle-income earners.

This bill will reinstate the 37 per cent marginal tax rate, which was eliminated by the coalition in our original stage 3 plan. This means that if you're on an income above $135,000 you will pay more tax sooner in the years ahead, due to wage inflation. This is called bracket creep, and 2.3 million extra taxpayers, or 14 per cent of taxpayers, will face the 37 per cent rate in 2024-25. This will rise to five million, or 26 per cent, in a decade. Labor's decision to reinstate the 37 per cent tax rate is a war on aspirational Australians trying to get ahead. It reaffirms what we all know, that Labor taxes more.

If people work harder, if they take risks, if they invest, if they employ, they should not be unfairly punished or penalised for doing so. In fact, they need to be rewarded and encouraged. They need to be thanked. I believe 100 per cent that we need to be incentivising aspiration, incentivising people to get ahead, to work harder, to earn more and to pay less tax. Labor don't like that. They believe in big, bureaucratic, high-taxing governments, not small, nimble, profitable businesses. In Labor's first 18 months in government, personal income tax has risen by a record 27 per cent. Bracket creep, driven by rampant inflation, is the thief in the night. The reinstatement of the 37 per cent tax bracket is the tax increase that Australians never voted for.

Finally, we won't stand in front of any tax cut for Australians. It's not our way. But I believe that this government should have done something about the cost-of-living crisis, about the real cause, rather than simply giving a pat on the head. I call on this government to be honest and tell Australians why this bill is being introduced right at this present time. Families across the electorate of Braddon—in the north-west, the west coast and King Island—in Tasmania are telling me, about their cost-of-living pressures, that they've never seen anything like it in their lives. This side have been telling Labor, over and over, that our communities are doing it tough. Their response, for 18 months, has been to ignore our pleas and to do nothing. They've kept the money in the bank while our families have gone hungry. For the past 18 months, with money in the bank, the government have turned their back on struggling families. So why now? Politics—that's why. There's a revolt in Labor ranks across the backbenches. They're nervous that they might lose their seats because people in their seats are also feeling the cost-of-living crisis. This government might have promised to leave no-one behind. They might have promised to hold no-one back. But the truth is their promises have gone unfulfilled. Hardworking Australians always go backwards under Labor, and you'll always pay more tax under Labor.

To put politics aside for one moment, I urge all Australians out there to forget about politics for a moment and sit down quietly and consider this. Ask yourself the question: have you felt better in the last two years under Labor, or is your family—like mine, in my electorate—doing it tough?

Tracey Roberts (Pearce, Australian Labor Party) | Link to this | Hansard source

I'm going to enjoy reading this carefully considered, detailed, factual speech. Listening to the previous speech, full of innuendo, scaremongering and real concern about these tax cuts, was just beyond belief. I rise to support the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 and the Treasury Laws Amendment (Cost of Living—Medicare Levy) Bill 2024.

I can tell you that when our Prime Minister, Anthony Albanese, announced the proposed tax cuts there were many happy faces around my community of Pearce. Our constituency is diverse and is one of the fastest growing and largest areas in Australia, with an average of seven babies born a day. We have many young families looking to establish themselves in Pearce, people moving in from other states and territories and from overseas, plus seniors who want to enjoy their retirement years close to their grandchildren and extended families. One of the reasons the electorate of Pearce is such a large and fast-growing area is that it's a beautiful location, with 32 kilometres of coastline, national parks and regional open spaces and thriving market gardens that have earnt us a reputation as the food bowl of the north.

However, we have all been challenged by the rise in the cost of living. Everyone is more cautious about what they are buying and how much they are spending. It is a conversation we are having within our families and friendship groups, and I have found people are happy to stop and chat about it openly. Families are becoming more careful in budgeting and financial planning, tracking income and expenditures and trying to identify areas where they can cut costs or make savings so that their essential needs can be met first. Many have sought social and community support to help them cope, and I would like to thank the many services in Pearce who have stepped in to support those in need.

The Australian Council of Social Service—ACOSS—released a paper titled 'People with the least need more support'. They reported that people on the lowest incomes are bearing the brunt of spiralling prices. ACOSS stated that frontline community services, which were already overstretched, are struggling to keep up with demand. ACOSS recommended a number of actions, including removing the stage 3 tax cuts altogether, as they really benefited only people on the highest incomes, not those under the greatest financial pressure. They were not alone in their criticism of the coalition's stage 3 tax cuts.

So how did we get here? Where do we go forward? Since the tax cuts were legislated five years ago, we have experienced a once-in-100-years pandemic, wars and global conflicts, global inflation spikes and higher interest rates. These events have put people under greater cost-of-living pressure. The Morrison government was piling debt on Australia. In 2022 the Albanese Labor government inherited almost a trillion dollars of debt, which was eye watering to say the least.

Thankfully, I am part of a government that listens to the community and acts. We know the family budget is under pressure and has been for some time. We have introduced measures to help our communities, including cheaper child care, cheaper medicines, electricity bill relief, increased rent assistance, more Medicare bulk billing, fee-free TAFE training, building more affordable homes, expanding paid parental leave and getting wages moving again. The question is: what more could be done to ease the pressure? Something has to change, and it is clear that every taxpayer needs and deserves a meaningful tax cut. Put people before politics—without a doubt, it works for me.

The Albanese Labor government's tax cuts deliver more relief to more people in a way that is fiscally responsible and does not add to inflationary pressures. They are designed to provide bigger tax cuts for Middle Australia to help with cost of living while making our tax system fairer. In my electorate of Pearce, every single taxpayer—I say that again: every single taxpayer—will receive a tax cut under Labor's tax plan, with 85 per cent receiving a bigger tax cut from 1 July.

As I have already stated, my community's diverse, as are others across the nation. Let's look at some figures. All 6.5 million women taxpayers will receive a tax cut, the average being $1,649; 1.5 million young Australian taxpayers aged between 18 and 24 will receive an average tax cut of $1,007; and, for those aged between 25 and 29, the average tax cut will be $1,573. Older Australian taxpayers will receive tax cuts ranging from $1,685 to $1,726. If you look at the tax cuts by occupation, a nurse earning $76,000 will get a tax cut of $1,579, a primary school teacher earning $80,000 will get a tax cut of $1,679, a truckie earning $77,000 will get a tax cut of $1,604, and a police officer earning $110,000 will get a tax cut of $2,429. Our tax cuts are good for Middle Australia, good for women, good for helping with the cost-of-living pressures, good for labour supply and good for the economy.

Labor's tax cuts will make a real difference for 13.6 million taxpayers who will receive a tax cut, 2.9 million more than would have benefited from Scott Morrison's plan from five years ago. They mean that 84 per cent of taxpayers, including 90 per cent of female taxpayers, will now receive a bigger tax cut. Parents, particularly women with young children, will be supported to return to work under the government's changes to their take-home pay. This, on top of the changes we have made to paid parental leave, will further assist women, who for too long have faced long-term consequences for their economic security. Treasury estimates that our changes will increase labour supply, driven by increases in hours worked and participation of women with taxable income between $20,000 and $75,000. Associate Professor Ben Phillips from the Australian National University stated: 'Support now is across the board rather than just at the very top. So that's good in terms of workforce participation, and it's also good in terms of cost of living relief. I think overall it's a fairer package.'

At the time of the 2021 census, there were 177,513 people living in my electorate of Pearce alone. There were nearly 50,000 families and 66,000 dwellings. These figures have changed since that time, with many more people moving in. I stumbled upon that because I was just questioning the numbers, but they are factual. The new tax cuts will make a difference for families in Pearce. For example, for a family on an average household income of around $130,000, with one partner earning $80,000 and the other $50,000, their combined tax cut would be over $2,600, which equates to almost $50 a week and is $1,600 more than they would have received under the old plan. That makes a difference. It makes a difference to families' budgets and to what they can spend their money on. It gives them hope that things are going to be alright within the family. The additional $50 per week will make a difference. It could literally mean more food on the table. It could help with the mortgage or rent, with paying an unpaid bill or with buying a pair of much-needed school shoes. These are things that people hold dear to their hearts. They are meaningful on a day-to-day basis for people working, living and trying to make ends meet.

The government's changes will deliver a better, more progressive tax system, addressing bracket creep by dropping two tax rates, lifting two thresholds and giving everyone a tax cut. This will provide $359 billion in help with the cost of living and will return bracket creep where we can do the most good: in Middle Australia.

From 1 July this year, the government will reduce the 19 per cent tax rate to 16 per cent, reduce the 32.5 per cent tax rate to 30 per cent, increase the threshold for both—with a 37 per cent tax rate applied from $120,000 to $135,000—and increase the threshold above which the 45 per cent tax rate applies from $180,000 to $190,000. As stated previously, all 13.6 million Australian taxpayers will receive a tax cut from 2024-25 onwards. The government's tax cuts will lower average tax rates for all taxpayers. That cannot be emphasised enough. That is a really important statement of fact. As a result of the changes, the average taxpayer will pay $21,635 less of their income in tax over the next decade. Under our proposed changes, taxpayers earning less than $45,000 will now receive a tax cut of more than $1,500 a year, which is around $29 a week—more than double what they would have gotten under the coalition's plan. This will help people in jobs that pay less, and it is important to us and the economy. Whether you are working in retail or as a checkout operator, as a pharmacy sales assistant or as a childcare worker, you are deserving of additional help.

It will also help to support many of the estimated 22,000 grandparents in Australia that are raising grandchildren, mostly due to some family crisis, conflict, mental illness, substance abuse, homelessness, child abuse, neglect or family violence. These grandparents have stepped in, and our tax cuts will help those grandparents who are trying to juggle that important task, with some using their superannuation to do so. Some are still working part time to supplement their income. For the single mum on a lower income doing the best she can to support her children, every tax dollar saved will count. Cassandra Goldie, the Australian Council of Social Services CEO, said of the stage 3 tax cuts:

These tax cuts were always bad policy and so we congratulate the Albanese government for listening to the deep concerns expressed by organisations including ACOSS from the beginning. They have now moved to make these tax cuts fairer to be targeting more of the dollars to people who do need help …

That is Cassandra Goldie, and we thank her for that comment.

While Australia offers a high quality of life, the cost-of-living challenges underscore the need for comprehensive and sustainable solutions to ensure economic stability and prosperity for all residents. The Albanese Labor government is providing meaningful cost-of-living relief in a responsible manner. We are delivering more help for working families and Australians who are under financial pressure by putting cash back into their pockets where they need it most, when they need it most. My community, like many others across the nation, are resourceful, resilient and absolutely deserving of our help. Every taxpayer in Pearce will get a tax cut.

In closing, it is also important to note that Treasury has advised that our tax cuts will not add to inflationary pressures, because they are broadly revenue neutral. The most recent inflation figures show welcome moderation. It is still too high, but it is moderating, and Treasury is clear that our tax plan will not impact their forecast for inflation to return to the target band next year. Our tax cuts are about ensuring more workers in Pearce and around the country can keep more of what they earn, because we know that it'll help take the pressure off people who are, without doubt, doing it tough. I reiterate the importance of listening and putting people before politics. I commend this bill to the House.

Cameron Caldwell (Fadden, Liberal National Party) | Link to this | Hansard source

I rise today to speak on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024, and I do this because I want to make a balanced contribution to the debate in this place that so far has been dominated by Labor's smoke and spin. Quite frankly, the introduction of this bill embodies the deception that's been on display from this Labor government. The bill before the House signifies the disdain that the Prime Minister and the Treasurer have for hardworking Australians. The Labor leadership campaigned on integrity and transparency in 2022, and yet here we are.

The Prime Minister has broken his promise again. The Prime Minister has looked Australians in the eye and knowingly and repeatedly misled them. He promised Australians that they could trust him to keep his promise because, as he said, 'My word is my bond.' If the Prime Minister can mislead Australians so blatantly, how can anyone believe anything he says ever again? This broken promise is about the Prime Minister's political future and not the long-term benefit of Australians.

The government asked Treasury to look at options, including revising stage 3, on 11 December. But, following that, the Prime Minister and the Treasurer stated on at least a dozen occasions that they hadn't changed their position on stage 3, including when the Prime Minister said, 'We're not reconsidering that position.' This is a political response from the government, not a cost-of-living response. It's obvious that the Prime Minister and the Treasurer aren't serious about Australia's long-term economic prosperity. All they care about is politics, not genuine tax reform and not long-term prosperity.

We can see this clearly in the government's words in the last few days. In a trainwreck interview on Monday night the Treasurer confirmed that the government didn't want to wait until after the Dunkley by-election to announce the changes to the stage 3 package. Let's just get this timing straight. The government finished 2023 having lost the Voice referendum that they were so earnestly depending on. There's a by-election coming up, so what do they do? 'Let's quickly come up with a sugar hit.' Now, I know a thing or two about by-elections, and do you know what the difference is between the Fadden by-election and the Dunkley by-election? The Prime Minister made one visit to Fadden and offered no new announcements in July last year. But for Dunkley the polling must be so bad that they've had to throw out a five-year tax plan in order to save the seat.

So, again, this morning the Prime Minister is calling on the coalition to vote against his own bill. He really only cares about the political wedge, the short-term political gain and the tactics. This Albanese Labor government spent all of last year distracted and completely obsessed by its failed $450 million Voice referendum. Meanwhile, Australians are now thousands of dollars worse off as a result of this government's economic mismanagement. Living standards have absolutely collapsed under this government. Net disposable income is down by almost $8,000 annually. The average Australian has seen the money in their pocket simply disappear. And it's really bad for mortgage holders.

While Australians have spent the past 18 months crying out for help, it's apparently only occurred to the Prime Minister and the Treasurer over summer that Australians are in a cost-of-living crisis. The coalition's position, as it always will be, is that we are committed to lower, simpler and fairer taxes. That's why ultimately we're not going to oppose the reduction of the 19c rate down to 16c. But we remain committed to fighting bracket creep and to supporting aspiration, because strong leaders keep their promises, even when it's hard. A future coalition government will deliver lower, simpler and fairer taxes. We will fight bracket creep and enshrine aspiration in our tax system. We'll reward hard work and support a strong economy where every Australian can get ahead. Importantly, we will unite rather than divide Australians over how much money they earn, either side of a tax bracket. Our tax reforms will always be fully costed and ready to implement. Most importantly, we will keep our promises.

So let's just re-examine what's actually in this bill. Labor's bill makes several changes to the already legislated stage 3 tax cuts, with the $18,200 to $45,000 threshold reduced from 19c to 16c. The flat $45,000 to $200,000 threshold that was going to be taxed at 30c is now going to be split in two: $45,000 to $135,000 at 30c and $135,000 to $190,000 at 37c. And now we're going to have the top tax threshold kicking in at $190,000. Additionally, there are increases in the Medicare levy low-income thresholds, in accordance with CPI. While we know that already 1.8 million Australians will be directly worse off as a result of these measures, including almost 10,000 residents in the electorate of Fadden, these numbers will actually swell in coming years. Labor's abject failure to address bracket creep will soon see the numbers affected rise to over four million. In addition, there will be budget blows. All of this is happening when Australians are already doing it tough under an incompetent Labor government.

Since coming to office, this Prime Minister has made wrong decisions, has been completely distracted and now continues to break promises. The Albanese government has failed to make any real headway in tackling inflation or getting interest rates anywhere near heading back down. Meanwhile, in Labor's first 18 months, personal tax receipts have risen by a record 27 per cent. Headline inflation remains more than 1.6 per cent above the midpoint of the RBA's target band. Most concerningly, food, housing, insurance, health and education costs are all growing much faster than the headline inflation rate. Core inflation measures remain higher than the headline rate, and the domestic inflation is a remarkable 5.4 per cent. Out of these tax cuts, an earner on the average $80,000 wage would receive just another $804 more under Labor's new policy, or $15.46 a week. That's less than one per cent of their annual wage and returns just 10c in every dollar of what they've lost due to cost-of-living pressures in Labor's first 18 months in office. Labor's broken promise entrenches bracket creep in our tax system and increases taxes by $28 billion on more than four million Australians.

What we actually have is a growing list of broken promises. Before the election the Prime Minister promised a $275 reduction in energy prices, no changes to super taxes, an increase in real wages, no changes to franking credits, cheaper mortgages and no changes to the stage 3 tax cuts. The Prime Minister has broken every single one of these promises. So what's next? The Prime Minister misled Australians and he's broken his promise. The consequence is that Australians quite simply cannot trust a single word that the Prime Minister now says. Australians cannot have confidence that the Prime Minister won't break more promises, and they're wondering, 'What's next?'

At the same time the Prime Minister promised he wouldn't touch the stage 3 tax cuts, he promised not to change negative gearing and taxes on the family home. But are these just going to be the next broken promises? If the Prime Minister and Treasurer are happy to promise on more than a hundred occasions to keep stage 3 and then just do what they've done here, what is it that they won't touch? The Prime Minister has been asked a number of times and we never get a straight answer. Is negative gearing next? The Prime Minister has failed to give a straight answer when asked very simply to rule out breaking his promise on negative gearing. The Treasurer was asked on 29 January about plans to make changes to negative gearing, and he said Labor wasn't 'considering it'. Funnily enough, that's what they said that about stage 3 tax cuts. The finance minister, on the Today Show, was asked that same question and said, 'We have no plans to do that.' That's what they said about stage 3 tax cuts. Does this government seriously expect Australians are going to believe a single word they say?

I want to come back to the bracket creep issue. The phone calls I've been receiving to my office and the people I know that I bump into in the street tell me that they are actually sick and tired of the way that their salaries are being characterised by this government. Is it really the case that someone earning $110,000, $130,000 or $150,000 is somehow rich and should be the target of this class warfare game that this Labor government continues to play? Last year, if you earned $150,000, you paid more than $40,000 in tax. If you earned $50,000, you paid $6,000. The people that have been calling me are the ones that are earning that $110,000, $120,000, $130,000 or $150,000. It's a pretty common bracket of income at the moment for lots of families on the Gold Coast. When you're earning that sort of money, you probably try to buy a home, and so over the last few years you've been absolutely belted by the interest rate rises. You get less childcare subsidy, so it costs more for parents to get back to work. You probably try to get the kids into private school education, so you're forking out each term for that. You've probably got private health insurance, so out comes another $500 a month on that. And of course you don't have concession cards, and you miss out on every handout that's ever given.

It's these people in Australia that don't feel like they're getting a fair go, and under this tax plan they can't see the fair go coming anywhere in the near future. I'm always happy for lower taxes in lower brackets, but what better way to drive aspiration than to say, 'You know what, it doesn't matter where you land between $45 grand and $200 grand; you'll only have to pay 30c on the dollar'? That gives a pretty broad range that the Treasurer himself has said was a good way to deal with bracket creep. It was one of the options, but he hasn't taken that option. This government is intent on just the sugar hit, the quick political fix, and is losing the opportunity for long-term reform that would lead to Australians being aspirational. What a wasted opportunity to reform the tax system! Again, this will deliver $15 in 137 days time. The problem for this government is that the bitterness of the broken promise will last long after the sugar hit is forgotten.

People around Fadden—in fact, all over Australia—are asking themselves, 'Is life actually better under this Labor government?' Eighteen months ago, things changed. They were supposed to change for the better, but they didn't. Cost-of-living pressures are biting Australian families, and they don't see a way out. What they really need to be cautious about is this: this Labor government has thrown them in a hole and then waited 18 months to try and give them a hand out of that hole. Australians are rightly suspicious of this Prime Minister and of this Labor government.

Maria Vamvakinou (Calwell, Australian Labor Party) | Link to this | Hansard source

Life for people in my electorate has certainly changed for the better since Labor won the election. Therefore, it is with great pleasure that I rise to speak on the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024, because this is a bill that reflects the Albanese Labor government's commitment to not only making life better and fairer for Australians but also addressing the cost of living and providing cost-of-living relief for Australians. Australians across the board are experiencing a cost-of-living crisis, one which is very strongly felt in my own community. My constituents more often are the ones who are doing it the toughest. They're also almost always the first to shoulder the brunt of any challenging economic times, and they often endure those challenges for much longer. That's why I strongly welcome the government's cost-of-living tax cuts.

These tax cuts provide tangible, real cost-of-living relief and support to Australians—again, especially to my constituents—while also providing reward right up and down the income scale so that aspiration is indeed rewarded and not thwarted. Every Australian taxpayer—13.6 million people—will receive a tax cut on 1 July under this government's plan, and 84 per cent of taxpayers will receive a bigger tax cut under our plan than under the previous government's plan. In Calwell, where cost-of-living relief is, as I said, much welcomed in the electorate, every single one of the 72,000 taxpayers will now get a tax cut—a permanent reduction in tax—of an average of $1,300 per annum. Of the 72,000 taxpayers, 64,000 people in my electorate, close to 90 per cent, will receive a bigger tax cut under these measures than they otherwise would have under the previous government's stage 3 tax cut package. This is among the highest proportion of Australians to benefit right across Australia.

This legislation means our government will be delivering a bigger tax cut for more people—welcome news for workers and families benefiting from these changes. It will help take some of the pressure off people who are at this very moment struggling and doing it very tough. It will do so while ensuring that, while more people in our community get a bigger tax cut to help with the cost-of-living pressures, these measures are delivered without adding to inflation and without burdening the budget. The measures will benefit people who, as I said, would have received absolutely no tax cut under the opposition's plans—people in my community who would have been left behind if the opposition had their way. These are culturally and socioeconomically diverse working families already under the pump from the rise in the cost of living, for whom meeting the cost of day-to-day living is an ongoing challenge. This Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024 puts cash back into their pockets when and where they need it most.

Cutting taxes, boosting wages, bringing inflation under control and driving fairer prices for Australian consumers is what this government's economic plan is all about, because tackling cost-of-living pressures, done fairly and delivered responsibly, is Labor's No. 1 priority. In addition, and more importantly, Labor's sensible economic management offers our community greater protection against bracket creep, particularly for low- and middle-income taxpayers, and supports the progressivity of our tax system. Our relief and reform package means more relief for workers and better reform in our economy, and that's what the changes in this legislation are all about.

Calwell reflects modern Australia in all its diversity, and just as Middle Australia is aspirational Australia, so too migrant Australia is aspirational Australia. Focused on building homes, building families and building our economy into the future, my migrant communities carry on the tradition of the great nation-building enterprise of the post Second World War migration program, which has seen this country and this country's economy develop. One of the central things that allows this social and economic reality to play out, which has benefited modern Australia, is the enabling of what we describe as the fair go—a fair go for those who want to live in a society that affords them opportunities and rewards aspiration, a fair go for every worker.

The nurses, the teachers and the tradies, who are some of the most likely to benefit, are also professions and trades that we're experiencing a high shortage of in this country. These are important skills and professions where this needs to be addressed and the skills need to be encouraged and developed domestically in order for us to fulfil the existing and looming work shortages going forward. A nurse earning $76,000 will get a tax cut of $1,579, and 96 per cent will be better off under Labor's plan. And what better way to assist and incentivise to grow our domestic capacity in areas where we have skill shortages? Many young people in my electorate, perhaps inspired by the focus and dedication, importance and value of frontline medical staff during the pandemic, are now considering and taking up careers in nursing. This is an aspiration which we should enable and assist. Making our tax system fairer for these professions will certainly bolster interest and their financial viability and attract young people or even those who may wish to retrain mid-career for another profession.

Our tax package also brings a similar attraction to other professions that will now benefit directly from our tax cuts. In that context, I refer to primary school teachers who will benefit. Teachers who are earning $80,000 a year will get a tax cut of $1,679. Truckies who are earning $77,000 a year will get a tax cut of $1,604 per annum. Police officers earning $110,000 will get a tax cut of $2,429 per annum. A shop assistant can expect a tax cut of up to $414 per annum. There are many people—a very large number of people—in my electorate who work in the IT sector. An IT manager on $160,000 per year, for example, can expect a tax cut of $3,729.

Many of my emerging communities have come here under the Skilled Migration Program and have chosen to make Australia their permanent home. Many international students who have settled permanently in Australia are also trained in the IT sector. They have chosen to build lives—lives for themselves and their families—here in this country, and they are certainly living in my electorate. They, too, make up the face of Middle Australia, which will benefit from this package.

Australian women, on average, will get a tax cut of $1,649 per year. There will be a bigger tax cut under Labor's plan, and this puts more money in women's pockets and, just as important, makes it easier for them to pick up extra hours of work, if they want to, as they will keep more of what they earn. This, alongside Labor's reforms to close the gender pay gap, support workplace flexibility and security, and rebalance unpaid care work, will help to address workforce participation for women. Women from my emerging refugee communities and my emerging migrant communities deserve the dignity of being paid fairly, of being able to keep more of their take-home pay and of having choices so that they can participate in the workforce and contribute to their families and to their own self-development.

Our modern economy must reflect the reality of our modern society, and our series of action packages, together, responds with this reality in mind and in practice. Whether you're on a low income and working part time or on a medium income, whether you're a couple with a single income earner, a dual-income couple who are both working full time or, indeed, a dual-income couple with one full time and one part time, every Australian will be better off under the tax cuts outlined in this important piece of legislation.

Importantly, ours is a government that understands that there is no one silver bullet to tackle the myriad of factors that add to the cost-of-living pressure ordinary Australians are facing. That is why all the measures in the proposed legislation will build on our $23 billion cost-of-living relief package, which includes significant support for lower-income earners, including energy bill relief and increases to income support payments. It's part of our broader plan and economic strategy to provide relief by boosting incomes, reducing costs and putting the budget on a stronger footing.

Those opposite consistently show a disconnect from the challenges faced by Australian workers. This disconnect is reflected in their standing against our measures and the actions that we have taken, whether it be on electricity bill relief, making medicines cheaper, cheaper child care, building more social and affordable homes, fee-free TAFE or getting wages moving again, including for minimum-wage and aged-care workers. They have stood against these measures. That those opposite are standing against these cost-of-living measures should come as no surprise to anyone. They are simply building on the previous government's record of inaction, which did absolutely nothing to arrest the escalating cost of essential goods and utilities.

People in my electorate know and understand the importance of a functioning government. They know that it is critical for government to intervene and put forward policies that reverse negative trends—policies such as increasing the Medicare levy low-income thresholds to ensure that people on lower incomes continue to pay less or are exempt from the Medicare levy. These have tangible, real take-home pay benefits. These are particularly important for the people of my electorate, because, as I said earlier, the cost of living is a huge concern to my constituents. These measures, along with the range of actions this government is taking to help ease cost-of-living pressures, is the core business of the Albanese Labor government, and I am very pleased to commend this bill to the House.

Jenny Ware (Hughes, Liberal Party) | Link to this | Hansard source

'My word is my bond.' So said Prime Minister Anthony Albanese. He looked Australians in the eye and knowingly and repeatedly misled them—about 100 times, in fact. This Prime Minister has committed a breach of trust on a scale not seen since Julia Gillard's infamous 'There will be no carbon tax under a government I lead.' And Australians will not forget this.

There are three things I want to say about the Treasury Laws Amendment (Cost of Living Tax Cuts) Bill 2024. No. 1 is that it is a gross breach of trust with the Australian people. Secondly, it leaves out to dry a great majority of Australians, and they are Australians who are earning an income of between $130,000 and $190,000 a year. While these are income levels that are significantly above the national average Australian income level, many of these people reside in my electorate. Indeed, in order to purchase a home in my electorate they need to be on an income of that level. These are the Australians the Prime Minister and the Labor government, those on the other side, have completely let down with this process. Thirdly, the Prime Minister and Treasurer Chalmers have missed an opportunity to deliver and to continue to deliver real tax reform that was started under the former coalition government.

Turning to broken promises, if the Prime Minister can mislead Australia so blatantly, how can anyone ever believe anything he says ever again? How can we trust that when he says he will make no changes to negative gearing there'll be no changes to the tax treatment of the family home and that he won't jump into bed again with the Greens and look at pursuing some of their tax reform ideas, such as a wealth tax, an inheritance tax? How can Australians ever believe a word the Prime Minister says?

This broken promise about the stage 3 tax cuts is about the Prime Minister's political future. It's not about long-term benefits for Australians. It's not about the long-term benefits of reforming our taxation system and bringing about secure and firm economic management. We're now aware that the government asked Treasury to look at options, including revising stage 3, as early as 11 December last year. But, following that, the Prime Minister and the Treasurer continued to state at least a dozen times that they hadn't changed their position on stage 3. And this was legislation that both Anthony Albanese and Treasurer Jim Chalmers both voted for in the previous parliament. If they are so committed to changing their position, why wouldn't they have simply come to Australians and said, 'We've changed our mind, and this is why.' Instead, 'My word is my bond' continued to be the mantra.

So this is nothing but a political response from the government. It's not a proper cost-of-living response. It's obvious from these changes that the Prime Minister and the Treasurer aren't serious about Australia's long-term economic prosperity. All they care about is politics, not genuine tax reform and long-term prosperity. We can clearly see that when we also know that the Dunkley by-election is coming up, and the Treasurer of course gave that train-wreck interview on Monday night where he confirmed that the government didn't want to wait until after the Dunkley by-election to announce changes. So these changes have been brought in simply to shore up a by-election and not in the long-term interest of the Australian economy. Remarkably, the Prime Minister this morning was calling on the coalition to vote against his own bill—absolutely remarkable: short-term political tactics aimed at wedging those of us on this side rather than looking at genuine economic reform. But Australians are smart. Australians can see right through this sort of politicking. Meanwhile, there are thousands of Australians who will now be worse off without the 37c tax rate disappearing from our taxation system. That will be not just in the short term and not just after 1 July but into the future, as we see more and more Australians impacted by bracket creep.

Again, this is reflective of this government's economic mismanagement, and we've seen this in the cut to Australians' living standards by at least 8.6 per cent. That's $8,000 a year that Australians used to have that they now don't have—$160 a week. If you have a mortgage, it's even worse. Average mortgage holders in Australia are now paying $24,000 to $30,000 more a year than they were under the coalition government. That's at least $500 per week in take-home pay. This is not sustainable for these people. The average renter is now paying $100 more per week than they were paying under the coalition government. These increases in housing costs are all attributable to economic mismanagement. It's a failure by the Prime Minister and the Treasurer to rein in inflation which has led to 12 consecutive interest rate rises. This is what is really impacting Australians with their housing costs.

On this side, we have heard Australians in our electorates crying out for help with cost of living for 18 months, yet it only seemed to occur to the Prime Minister and the Treasurer over summer that Australians are in a cost-of-living crisis. We've now got the Dunkley by-election coming up so, suddenly, they are masquerading that they are delivering real tax reform. The coalition will be supporting these laws, and that's on the basis that we are committed to lower, simpler and fairer taxes. That's why we won't oppose the reduction in the 19c tax rate to 16c, for example. It's why in the first place we brought in a suite of tax reforms. We brought in stage 1 and stage 2, which showed our commitment to reducing income tax for Australians on low and middle incomes. Stage 3 was intended then to address those Australians on higher incomes. Many of these Australians are earning between $130,000 and $190,000. While that is an income that is significantly above the average Australian wage of $85,000 per year, these people have been forgotten by this government. Many of these people, in my electorate, for example, need an income of that amount to be able to pay their rent or their mortgage in that electorate. That is the same for many who live in our cities throughout Australia, whether that be in Sydney, Melbourne or Brisbane.

As we move into the election, the coalition will demonstrate that it is still committed to real tax reform and to real, proper economic management. We'll be going to the election with a tax reform package in keeping with these stage 3 tax reforms and more. That's because they were good reforms. They removed the 37c tax bracket, demonstrating our commitment to fighting bracket creep and enshrining aspiration for Australians. As a matter of fact, these reforms were so good that those on that side voted for them when they came in. Our package, therefore, will deliver lower, simpler and fairer taxes. We will fight bracket creep and enshrine aspiration into our tax system. We will reward hard work and support a strong economy where every Australian can get ahead. We will unite Australians through a tax policy, rather than pitting Australians against each other and trying to bring in the cultural wars and the income wars of the class wars of the past. Our package will be delivered while providing for Australia's future security and guaranteeing the essential services that Australians rely upon. Before we go to the election, the package will be fully costed and ready to implement when we are elected. Most importantly, we will keep our promises. Our word will be our bond. When we turn to the provisions of the bill, we see that it makes several changes to the already legislated stage 3 tax cuts, but, in particular, it has not removed the 37c tax rate, which was vital for us to look at addressing long-term bracket creep and to ensure—

Sharon Claydon (Newcastle, Australian Labor Party) | Link to this | Hansard source

The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour. As the member's speech was interrupted they will be granted leave to continue when the debate is resumed.