Senate debates

Wednesday, 14 November 2018

Statements by Senators

Australian Labor Party

12:45 pm

Photo of Eric AbetzEric Abetz (Tasmania, Liberal Party) Share this | | Hansard source

Labor's ugly and opportunistic politics of division need to be outed. In recent times, we've seen Labor promote the politics of envy, jealousy and resentment of one Australian against their fellow Australian. It is the politics of division, the politics of class warfare and the politics of denigrating the virtues of hard work, self-reliance and delayed gratification. Virtues which have built our nation are being demonised by Labor in favour of the disingenuous and dishonest socialist dogma of an alleged equity, which in actual practice sees all people ultimately become equally poor. As Margaret Thatcher said, socialism always fails because they 'run out of other people's money'.

To partially pay for Labor's extravagant policies, they are intent on ripping off hardworking Australians who have worked hard, seeking to be self-reliant and not be a burden on their fellow Australians. Today, I will deal with just two of Labor's five unfair tax policies conceived in the womb of envy. First is Labor's policy on negative gearing. Now, seriously, this is 'policy stupid' on steroids. To justify Labor's tax grab, they use all the rhetoric of division but no common sense. Negative gearing allows mortgage payments to be deducted against rental income by property owners. The practical impact of removing this deduction will, in fact, hit the poorest the hardest. Why is that? Because all the reports have indicated that, if you remove negative gearing, the household owner will make up for it by increasing rent, so it is the renters within our community who will actually pay the burden of Labor's tax grab. As we might think, it is mainly the renters within the community who are, in fact, on the lowest incomes. In my home state of Tasmania, it has been determined to be about $500 per annum extra that people renting their houses will need to pay to their landlords, courtesy of Labor's attempted tax grab.

Labor have portrayed this as somehow being an unfair concession to the rich. That's the rhetoric, but, as I always want to do in these debates and in considering these matters, I ask: what are the facts? The facts are that in my home state of Tasmania, for example, in the electorate of Lyons, there are 3,000 negative gearers. In the electorate of Braddon, where the Liberal Party has just endorsed Gavin Pearce—an exceptionally good candidate—there are 3,400 negative gearers. In the electorate of Bass, there are 3½ thousand negative gearers. And so the list goes on. Labor, having realised the stupidity of their policy, have sought to say that they will somehow grandfather it. Let's remember the actual numbers within the Australian community, because those who use negative gearing are neither rich nor the owners of multiple investment properties. Rather—and these are very stunning statistics—they are made up of 58,000 teachers, 41,000 nurses, 52,000 retail workers, 19,000 police and emergency personnel, and tradies and small business people who put aside a bit of money each month to save for their future. About two-thirds of those who negative gear have a taxable income under $80,000 per annum. So much for Labor's dishonest portrayal that these are, allegedly, the rich people within the community. And 71 per cent have only one property, and 72 per cent use it for a tax deduction of less than $10,000 per year.

There are approximately 1.3 million of our fellow Australians who negatively gear, and according to the Labor Party they are the filthy rich, who need to have their tax burden increased. No, they are 1.3 million of our fellow Australians who are willing to delay and defer income today for a better future for themselves tomorrow so they won't be reliant on their fellow Australians through the welfare system. They want to work hard and they want to save to ensure that they can be self-reliant and not a burden on their fellow Australians. These are virtues that we in the Liberal Party embrace; these are virtues that we in the Liberal Party want to ensure are continued.

Just briefly, the Australian Labor Party in fact got rid of negative gearing once. That worked out exceptionally well, didn't it? Within two years they had to reinstate it. Mr Swan, whilst he was Treasurer, told Melbourne radio, 'It would be economically disastrous to do anything on negative gearing.' Mr Swan was right then, and that statement remains right today. It is a matter of regret that the Australian Labor Party do not see that it is still the case today.

Secondly, in the brief bit of time remaining to me, I turn to Labor's attempt to double-tax our pensioners and our self-funded retirees. Here we have another cohort of the Australian community that are not rich. In fact, it's 870,000 of our fellow Australians who will be impacted by Labor's tax grab, which seeks to double-tax them. With the dividend imputation that Labor wants to remove we have a situation where franking credits used by the shareholder are allowed to be offset against their tax obligation. In other words, it would be a tax refund. And who are the people who currently benefit from this? They are overwhelmingly low-income earners within the Australian community.

As I said, 870,000 of our fellow Australians will be worse off under Labor's proposed changes. More than half of all the people impacted by Labor's policy have a taxable income below $18,200. Hello, Mr Shorten? Hello, Labor Party? This is not a cohort of the filthy rich, as Labor would seek to portray them. Indeed, 96 per cent of all people who will be impacted have a taxable income below $87,000—hardly the filthy rich! And yet these are the people that the Australian Labor Party would seek to target, be it those who are currently employed or be they teachers, nurses or retail workers who want to save for the future and put a nest egg aside. As the Liberal Party and as the Liberal government, we say to them, 'If you want to have a go, we'll give you a fair go.' Labor's approach is, 'If you want to have a go, we'll tax you to ensure that you cannot get ahead.' We do support the aspirational, those who believe in the virtues of self-reliance, working hard and deferring lifestyle today until tomorrow to ensure that they can be self-reliant and not a burden on their fellow Australians.

I say to my fellow Australians as we approach the next election: be exceptionally careful with what the Australian Labor Party will need to do to fund their extravagant policies. The funding of their extravagant policies will come out of your pockets, especially those of you who seek to look after yourselves. The Liberals will always give a fair go to those who seek to have a go.