Treasurer won’t tinker with tax cut plan

Marnie Banger
(Australian Associated Press)


Treasurer Josh Frydenberg says he’s not toying with the idea of bringing forward the later stages of his government’s planned tax cuts to help keep the economy humming.

Instead, he insists the coalition will deliver exactly what it put to the nation before people went to the polls on May 18.

“We set out to the Australian people what our plan is on the tax cuts and we’ll be putting it to parliament as a package, as endorsed by the Australian people at the election,” Mr Frydenberg has told reporters on Wednesday.

The government is ramping up pressure on Labor to back the legislation, which will come before parliament next month.

Mr Frydenberg says it will take just days for the Australian Tax Office to make the changes implicit in the first stage of the tax plan, through which low and middle income will get to keep up to $1080 more of their pay.

The extra money would even reach those earning up to $126,000 who have already done their tax return for 2018/19 before the laws passed.

“Let’s hope the Labor Party has learnt that lesson from this election, that you can’t stand in the way of aspiration and shouldn’t stand in the way of lower taxes for millions of Australians,” Mr Frydenberg says.

The opposition supports the first part of the government’s tax plans, which will provide more tax relief for low and middle-income earners.

But it’s unsure about the later stage of the government’s package, which will flatten the tax rates schedule by mid-2024.

The coalition has ruled out breaking up the legislation, insisting the long-term structural changes are pivotal.

The tax cuts should have a clear run in the lower house, where Prime Minister Scott Morrison is set to govern with 77 seats in the 151-seat parliament.

But the government risks facing resistance in the Senate, where it will need the support of crossbenchers or Labor to pass laws.

But with Senate vote counting continuing, the 76-seat upper house to start on July 1 is likely to comprise 35 coalition MPs, 26 Labor, nine Greens, two One Nation, two Centre Alliance, one Australian Conservative MP and Jacqui Lambie from Tasmania.

Shadow treasurer Jim Chalmers says Labor is still waiting on information from the coalition on how much of the later tax cuts will flow to the higher income earners.

“If they were serious about this, they would provide that information so that we can come to a final, considered view,” he told reporters in Brisbane.

The Centre Alliance party is leaving no stone unturned as it mulls whether to back the plan.

Centre Alliance Senator Rex Patrick says he and upper house colleague Stirling Griff would like nothing more than to give hard-working Australians a tax break.

But given the coalition government’s tax package will cost $158 billion in coming decades, their decision won’t be made lightly.

“I met yesterday with the Reserve Bank governor, I met with Treasury officials yesterday, and indeed had a lengthy conversation with (competition watchdog chairman) Rod Sims,” Senator Patrick told ABC’s Radio National on Wednesday.

“We are going through due diligence to make sure that whatever way we cast our vote, it is done on merit and on proper analysis.”


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Categories: Tax