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Wednesday, 25 November 2015
Page: 8945

Goods and Services Tax


Senator GALLAGHER (Australian Capital Territory) (14:00): My question is to Senator Cormann, the Minister representing the Treasurer. I refer to a report by National Shelter released yesterday which shows that more people are paying more out of their weekly income to cover rent—in some cases up to 65 per cent of their income. Won't raising the GST to 15 per cent make it even harder for Australians to save the money they need to achieve their dream of homeownership?


Senator CORMANN (Western AustraliaMinister for Finance and Deputy Leader of the Government in the Senate) (14:00): I think I have seen this movie before. It sounds a bit like a broken record—

Senator Ian Macdonald: You'll be back!

Senator CORMANN: Yes, I thought 'I'll be back' was my line, but Senator Gallagher is back! And it is essentially the same question. And let me tell you something: I have a very high regard for Senator Gallagher's capacity to make a great and fine contribution to Australia in this chamber in the years and decades to come. Hopefully, it will be for a while longer in opposition, but eventually, down the track, I am sure she will make a fine contribution in a future Australian government. Let me give her one very well-intentioned lesson. If you keep asking the same question you will keep getting the same answer, and the answer is that the government does not have any proposal in front of it to make the sort of changes to the GST she is suggesting.

What we are doing as part of our commitment to growth and jobs is engaging in an open and transparent conversation with the Australian people. We are engaging in a good faith conversation with the states and territories on how our tax system can be further improved and how it can be made more growth friendly so that we can strengthen growth and create more jobs.

The premise of the question is entirely false, and what I would suggest to the Labor Party is that this was supposed to be the 'year of great ideas'—remember? And do you know that the three big, great ideas of the Labor Party are three tax increases? They have the tax on people's retirement savings, the tax on business—which will cost jobs according to Treasury—and they have the tax on cigarettes. So the great ideas on the Labor side are more new taxes, but on this side we are thinking very carefully on how we can strengthen growth and create more and better jobs. We would suggest that the Labor Party actually become part of the conversation rather than be part of the problem. (Time expired)




Senator GALLAGHER (Australian Capital Territory) (14:03): Mr President, I ask a supplementary question. Yesterday in the House of Representatives, the Prime Minister admitted that housing affordability was a 'very, very big issue.' Won't raising the GST to 15 per cent make this issue even bigger?


Senator CORMANN (Western AustraliaMinister for Finance and Deputy Leader of the Government in the Senate) (14:03): The Prime Minister is of course 100 per cent correct. Housing affordability is a serious issue, and the way that you improve housing affordability is by increasing the supply of housing. What happens to the affordability of anything in a free market is a function of supply and demand. If you have stronger demand than available supply, prices go up; if you have stronger supply than demand, prices go down, and over time in a market things get back into balance.

The truth is that there are a whole range of things that we, with the states and territories, should be focusing on to improve housing affordability, but the premise of Senator Gallagher's question, as indicated in my primary answer, is false, and we reject it. She is trying to suggest that certain decisions have been made in relation to a process that has not reached a conclusion. So Senator Gallagher or any other Labor senator can keep jumping up and down every day— (Time expired)


Senator GALLAGHER (Australian Capital Territory) (14:04): Mr President, I ask a further supplementary question. Adrian Pisarski from National Shelter, when speaking about rental affordability, said:

Low income households are being hammered beyond belief … Many middle income households are finding it hard to make ends meet. These households then ultimately don’t have disposable income to spend on key life items like health, transport, education and food.

Won't raising the GST continue to hammer low-income households beyond belief?


Senator CORMANN (Western AustraliaMinister for Finance and Deputy Leader of the Government in the Senate) (14:04): We want every Australian, in particular low- and middle-income earners around Australia, to have the best possible opportunity to get ahead and to improve their living standards, and the best thing we can do as a government and as a parliament is to put in place the policy settings that help facilitate stronger growth and that help facilitate an environment where more and better jobs can be created so that more people across Australia have the best possible opportunity to get ahead. That is what we are doing across the whole government of public policy. That is why we are engaged in an ambitious infrastructure investment program. That is why we are engaged in an ambitious free trade agenda. That is what we are looking at how our tax system can be further improved to make it more growth friendly. That is why we got rid of all these bad Labor taxes—all of that lead that Labor put in our saddlebags in their last six years in government. We will not be distracted by Labor's sniping.