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Tuesday, 23 October 1984
Page: 2200

Senator COATES —I ask the Minister Assisting the Prime Minister on the Status of Women whether she has seen Nicholson's cartoon in today's Age which illustrates a relatively poor working family with four children. The husband is saying: 'My wife has to work to make ends meet'. Also illustrated is an obviously rich family with the breadwinner saying: 'My wife will have to stay at home to make ends split'. What would be the impact on women, especially those in low income families, of any proposals to introduce income splitting for employees for tax purposes?

Senator RYAN —Insofar as it is possible to make any comment on the proposal, it is clear that this proposal, like all of the tax proposals coming from the Opposition, would mainly favour high income wage earners who had a stay-at-home spouse. The Treasurer, Mr Keating, yesterday drew attention to the fact that, should such a proposal be implemented, he or any of us on a high income with a stay-at-home spouse would benefit much more than a person on a low income with a stay-at-home spouse.

Senator Grimes —Mr Howard agreed with him.

Senator RYAN —As Senator Grimes has pointed out, Mr Howard agreed with Mr Keating's analysis, as he would have to, because all the proposals of this ilk that come from the Opposition are framed in terms which favour the high income earners in our community. We are interested in a review of the taxation system which our Leader, Senator Button, has described yet again to the Opposition, in order to create a more just and equitable system, in order to create systems of taxation which do not discriminate against low income earners and low income families, whether they be two income or single income families or whether they be families with no wage at all. There is a very large number of such families at this stage-families which have to live on the dependent parent's rebate and whose circumstances are completely ignored by a proposal such as this.

The Opposition's proposals ignore current trends in the Australian work force. For example, the Australian Bureau of Statistics survey on Australian families in 1982 found that 65 per cent of married women with dependent children were in the labour force or wanted a job; that 54 per cent of married women with children four years of age or under were in the labour force or wanted a job; that 72 per cent of married women with children aged five to 14 years were in the labour force or wanted a job. In the face of this clear statement of what Australian women want, the Liberal Party's proposal, which would provide a disincentive for women, particularly those with the opportunity to earn only a low income, to participate in the labour force, is really quite incomprehensible .

Under the income splitting proposal a married woman who considers entering the work force would have to take into account the additional tax incurred by her husband as a result of a decision to enter the work force. That disincentive may be offset in some ways for those with young children by the proposal, still very vague, for a child care rebate. The increase in the disincentive for married women to enter the paid work force would impact most on low income families because in those families women tend to make a larger contribution to the combined income of the family. The proposal offers nothing to single women and women in couples without dependent children. As with all the Opposition's tax policies, their direction is to favour those on higher incomes.

Senator Chaney —Will the Minister please table the document from which she has quoted?

Senator RYAN —Happily.