Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

I thank Senator Ketter for that question. Of course, if he had quoted my full quote, he would have seen that the comments made by the Treasurer and me were entirely consistent. What I said in the interview on Radio National was that bracket creep is a problem, it is a drag on growth, and that we would do as much is possible to address it and as much as we can sensibly afford, which I would have thought was an entirely reasonable boundary to set. Indeed, it is a very responsible boundary to set in relation to any policy proposals that will come forward down the track.

The second point I would make is that it is self-evident that the stronger the wages growth and the higher the wages growth across the community the faster people move through individual income tax brackets; and the lower the rate of inflation or the lower the rate of wages growth the more slowly people move through individual income tax brackets.

So the key point is this, and the government are of course of one mind in relation to this: bracket creep is a problem, bracket creep is a drag on growth, bracket creep is something that the government are committed to addressing, and we will address it to the best of our ability. We will do the best possible job to address bracket creep by pursuing personal income tax cuts in a way that is sensibly affordable.

Labor should have a close look at their policy, which is to spend more, borrow too much and then tax more. They are always chasing increased levels of expenditure with more new taxes. Our focus is on strengthening growth and creating more jobs, and part of that focus is to ensure that our tax system is as growth friendly as possible and as efficient as possible, and that we address bracket creep in the best way possible and in a way that is sensibly affordable. (Time expired)