Louise Pratt (WA, Australian Labor Party) Share this | Hansard source

So the government has sound economic plans for both now and the future. But this responsible and sound economic plan is being put at risk by those opposite playing politics and engaging in one-upmanship. Take, for example, the luxury car tax package of bills. Those opposite want to reduce government revenue by more than $6 billion by opposing our budget measures. They want to stop the government investing in Australia’s future. Why? To protect their rapidly declining economic reputation perhaps?

Let us not forget a few things here. This is a not a new tax being introduced. We are simply attempting to change the rate of an existing tax. We are not attempting to tax people who cannot afford it, unlike those opposite in refusing to accept our changes on the Medicare levy. The luxury car tax rate is progressive. It is a tax rate planned to make the tax system fairer. It is not a tax that is going to have a significant impact on working families. Rather than as some people have alleged, it is not going to affect people with disabilities. The tax law already provides exemptions from the luxury car tax for people with a disability so that they can purchase vehicles with the kinds of adaptations that they require. It is scaremongering on the part of those opposite to assert that this measure will hurt working families.

Of the 20 top-selling cars in Australia, less than four per cent of those sold are subject to the luxury car tax and for the lower end the increase is in the order of hundreds, not thousands, of dollars. We do not think it unreasonable that people who have done well in recent years, particularly from government decisions in terms of tax cuts, should pay just a little bit more for a luxury car. If everyone in this country pays their fair share, and we plug the gaps in the system, we can reduce the overall tax burden imposed on working families while maintaining a strong economic surplus and investing in the future productivity of our nation.

So I urge the Senate to reject this motion out of hand. The motion is nothing more than political grandstanding on the part of those opposite. I think this, combined with attempts by the Liberals to hack into the budget surplus, is thoroughly reprehensible because this is all happening at a time when we are facing a difficult global economic situation. Rather than condemning them, we should be congratulating the Rudd government. We should be congratulating them for strengthening the Australian economy through their modernisation strategies; for creating a modern economy so that the inflation challenge brought about by years of blinkered economic mismanagement can be addressed; for creating a modern economy that can withstand international economic turbulence now and into the future; and for delivering now for working families, taking the financial pressure off those most in need. The government have clear strategies for building a strong economy. We are here to fight inflation and to deliver now for working families under financial pressure. I think, for all of those things, the Rudd government should be congratulated.