Ms GAMBARO (2:21 PM) —My question is addressed to the Treasurer. Would the Treasurer advise the House how yesterday's budget further reduces the tax burden on Australian businesses and families?

Mr COSTELLO (Treasurer) —I thank the member for Petrie for her question. The government's income tax cuts mean that a worker on average wages, who under Labor's tax system used to pay a top marginal tax rate of 43 cents in the dollar, now pays a top marginal tax rate of only 30 cents in the dollar. That is a reduction from 43c to 30c. I do not know why, but the Labor Party, for some reason, believe that average workers should pay 43 cents in the dollar tax on every additional dollar that they earn. We do not. We think that people who are going out there and working hard ought to get the rewards of their effort. Isn't that a great thing for average workers? They can go from $20,000 to $50,000 and never face a marginal tax rate above 30 per cent.

The tax reform that was also announced last night for self-funded retirees of age pension age and for age pensioners cuts their tax bills and means that individuals need not pay tax or the Medicare levy until they get to $20,000. I want to put this in context. Before this government was elected, if you were a self-funded retiree, your tax-free threshold was $5,400; you started paying tax after $5,400. As a result of the measures which were announced last night, if you are a single income self-funded retiree of age pension age, you start paying tax above $20,000. I do not know why the Labor Party had it in for self-funded retirees in the way that it did. The Labor Party had a mind-set against people who used to fund their own retirement. The Labor Party—because of its socialist origin, no doubt—resented those people who had funded their own retirement and wanted to tax them and to penalise them. It resented people who were earning average wages. But in last night's budget we increased the tax-free threshold for senior Australians, both age pensioners and those of age pension age. We cut the company tax rate from 34 per cent to 30 per cent and we abolished financial institutions duty. You now no longer need to pay tax when you put money into a bank account or pay a mortgage or a credit card. We abolished stamp duty on listed shares. We are refunding excess imputation credits. We introduced new capital gains tax concessions for listed investment companies and we are bringing about the new small business taxation system.

I was speaking to one of our friends in the media last night, who said to me, `This tax cut for self-funded retirees applies back to 1 July last year; that's a bit tricky, isn't it?' I said, `Tricky is not when you backdate tax cuts; tricky is when you put tax cuts into l-a-w.' The difference between Labor and the coalition is that Labor believes in tax cuts which are l-a-w. This government believes in tax cuts which are n-o-w—now—paid from 1 July and eligible to self-funded retirees as soon as they put in their tax return.