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Wednesday, 24 August 1983
Page: 163

Mr MOORE —My question is addressed to the Treasurer. Following the beat-up of expectations about the Budget and the delivery of something quite different--

Government members interjecting-

Mr MOORE —There must be a few guilty men around.

Mr SPEAKER —Order! Honourable members will restrain themselves. The honourable member for Ryan should continue with his question.

Mr MOORE —I ask the Treasurer whether he agrees with the comments of Mr Risstrom that he, the Treasurer, does not realise that the combined effect of the May mini-Budget and last night's statement is a staggering increase of 16 per cent in tax for a person who earns $15,000 a year.

Mr KEATING —No, I do not agree with the comments. The net increase in pay-as-you- earn tax of 6.7 per cent reflects the general increase projected for average weekly earnings, and PAYE receipts would be higher, of course, other than for the tax cuts which were issued last year. But Mr Risstrom is including in his calculation the Government's changes to the health levy arrangements-Medicare- which are, of course, in substitution for the private health insurance premiums normally paid by taxpayers but which will now be paid under Medicare arrangements for a universal health insurance cover.

One of the elements of Mr Risstrom's figuring was to apply part of that cost to the deduction for home mortgage interest. As I acknowledge, in May the Government quite reasonably changed, as a structural measure and as a priority measure, the provision which allowed home mortgage interest payments by middle and higher income earners on existing mortgages on property to be claimed as a tax deduction and refocused that money on first home ownership assistance to give the opportunity to obtain a home to people who previously did not have a home and to make it easier for Australians to have a home. We do not resile from or apologise for that change. The original scheme was one of the grab-bag measures which the previous Government thought it would introduce to ingratiate itself with the electorate. It should never have been introduced in the first place; it had no basis in equity and should not have been there. I do not agree with Mr Risstrom's calculation, and the Budget figuring stands for everyone to see.