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Wednesday, 21 April 1999
Page: 4011


Senator COOK —My question is directed to Senator Alston, the Acting Leader of the Government in the Senate. Can the minister confirm that, in response to a question from Senator Conroy during yesterday's question time, he stated that `no . . . single group will be worse off' under the government's tax package? Can he also confirm that he added, `In fact, they will be better off'? How then does the minister explain his comments later in question time that `81 per cent of people are better off'? Can the minister confirm that, according to his own calculation, this means that the remaining 19 per cent of the Australian population will not be better off? Given the repeated claims by both the minister and the Prime Minister that no-one will be worse off, can the minister advise what methodology he employed to conclude that for close to four million Australians the economic impact of this massive and complicated tax package will be precisely nil?


Senator ALSTON (Communications, Information Technology and the Arts) —We have had quite a long time debating the relative merits of tax cuts.


Senator Conroy —Have you read your brief this time? Stick to your brief.


Senator ALSTON —We went right through an election campaign with plenty of material on the table.


Senator Conroy —You stuffed up twice yesterday.


The PRESIDENT —Order! Senator, it is totally outside the standing orders to start interjecting the minute the minister speaks on something that is not even related to the question. I regard your conduct as completely in breach of the standing orders.


Senator ALSTON —Thank you, Madam President. Since that famous day, I think more than six months has elapsed. During that time we have had every man and his dog crawling over every detail of our tax proposals. It is simply astounding and beyond belief that Senator Cook would not be aware of the very significant taxation cuts that we were offering to the Australian electorate and that we hope to put into legislation in the near future.

What we have said repeatedly is that all Australians earning less than $50,000 will pay 30 cents in the dollar or less tax. In other words, 81 per cent of Australian taxpayers will have a top effective marginal tax rate of 30 per cent—game, set and match. If you are not aware of that statistic, then you obviously did not listen to any of the debate during the election campaign. You have paid no attention to the assessments that have been made since that time.

That figure is one that we think very much resonated with the Australian community. They very much understood the benefits of taxation cuts. They did not for a moment like the nitpicking that you offered them because, in terms of tax cuts, you offered them absolutely nothing. All you wanted to do was punish them with capital gains tax changes and the like. They understood well and truly, even if Senator Cook does not, that by reducing the effective marginal tax rate for 81 per cent of the population you have a huge gain for ordinary Australians.


Senator COOK —Madam President, I ask a supplementary question. Thank you for your bluster, Minister, but would you answer the question I put to you? On your own calculation, 19 per cent of Australians—that is, 14 million people—would not be better off. The question was: what methodology did you use to calculate that figure? Could you just answer that part of the question, please?


Senator ALSTON (Communications, Information Technology and the Arts) —It really is extraordinary. The statement I have made, and it has been made repeatedly by every senior member of the government, is that as a result of our tax cuts 81 per cent of the population will be on a 30 per cent marginal tax rate.


Senator Robert Ray —That's not what you said yesterday.


Senator ALSTON —That is exactly what I was talking about yesterday, and you know it. We have had all this nonsense all week with you trying to pretend that somehow you can identify a few little people here and there who might conceivably be worse off. We have gone through all that. I have quoted from Mr Costello's very fine article in the Australian Financial Review . You know what we have said ad nauseam about that. Never in my wildest dreams or anyone else's wildest dreams have we suggested that somehow 19 per cent of people might be worse off as a result of a new tax system. It is a preposterous proposal. We have never even thought of it. Why would we? The whole idea of the new system was to ensure that people were not worse off, that we did look after those on low incomes. (Time expired)