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Wednesday, 20 June 2018
Page: 3388


Senator O'NEILL (New South Wales) (10:27): I too rise to put my remarks on the record with regard to this very important proposed piece of legislation, the Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018. This bill has the potential to have a significant and profoundly negative impact on Australians, as it is constructed by this government.

I find that we hear once more—in the throes of the drama and intensity of these last two weeks of sitting before we go to another break—the government saying: 'This has got to be done now. This has got to get sorted now. On 1 July, the whole world's going to fall apart unless we get this resolved.' The pressure, right now, as I am making this contribution to the debate, is being applied to the crossbench, some of whom—or their advisers—I hope might be listening to my contribution. I want to point out how important it is that everyone understands that the Treasurer himself has conceded that the legislation does not need to be in place by 1 July for the tax relief that's being discussed to be received by the end of next financial year. That's the reality. This pressure cooker that's being created is an artifice. In this hastily constructed pressure cooker, we shouldn't be making decisions that would affect people six or seven years hence with such negative consequences, in my view, for our economy and, more profoundly, for our community.

We're being faced with a choice by this government, with its litany of failures in service provision, between continuing along the path that it has set of taking away more and more services from Australians and throwing money, a little bit of money, at those who need it most and extraordinary sums at people on $200,000, who are not clamouring at the doors of this place saying: 'Give me $7,000. I can't survive without it.' That is not the challenge that is facing us in this parliament. The challenge is people clamouring at our doors, day in, day out, asking for the funding of basic services. There are over 100,000 Australians right now who are seeking aged-care packages. They're desperate for some help in their home so they can stay there. They're desperately in need. I see Senator Brown has joined us in the chamber here. People are trying to get decent services for disability needs. People are speaking to me in my role as the assistant shadow minister for mental health, despairing about suicide in their community and being unable to access services.

That's the landscape: the service deprivation that has been imposed upon this nation by this government over five years of ripping money out of the services that Australians should have a right to expect. And having done that now, its grand plan, in addition to having abandoned any sense of fiscal responsibility and budgetary constraint, is to try and buy off Australians by throwing some tax money at them in an entirely inappropriate and unfair way. That's why Labor will oppose the way in which this government wants to advance tax reform in this country.

Budgetary decisions are all about choices, and Labor is going to choose services for all and tax cuts for those who need it most. It contrasts profoundly with the government's proposal of giving tax cuts of a shape and form that six years from now—when kids in year 7 have finished high school—in 2024 will deliver a tax structure where 80 per cent of the benefit will flow to the top 20 per cent of wage earners in this country. If I only repeated that fact over and over and over in my contribution, if only that single fact could seep into the conversation about this proposed tax reform by the government, Australians would understand what a dog they're being sold and how cruel and unfair this government's proposal is. The bottom 60 per cent of all workers will get no tax benefit at all by 2024, if this government's bill passes as it is. That's the shape and form of what we're discussing here and why the debate that we're having is so important.

This government's Personal Income Tax Plan demonstrates exactly how out of touch this government is. We as the Labor Party do not support someone on $200,000, which is the standard pay for most of the people who work in this parliament, paying the same tax rate as someone on $40,000. That is plainly unfair. We've seen this over and over in the course of this Liberal-National Party government with the prioritising of the top end of town over ordinary Australians; the prioritising in terms of tax where the cost is not just a lack of income benefit to low- and middle-income earners but the ongoing removal of services and the ongoing cuts to services absolutely across the horizon, if it gets this piece of legislation through.

I want to have a little bit of a look at a distributional analysis. If we look at the impact of this government's decisions, we can see that it has failed to provide any form of a distribution analysis of its Personal Income Tax Plan. But Labor and interest groups have, and it's very clear that stages 2 and 3 of the proposed tax reform by this government absolutely and totally fail the fairness test. Let's be absolutely clear here: stages 2 and 3 of the government's tax plan will flatten out Australia's personal income tax system, and that structural change to the personal income tax system is eroding its progressivity. This is a fundamental principle of our tax system, and it's based on the premise that, if you earn a small amount of income, pretty well everything that you earn goes to keeping a roof over your head, providing food, providing shelter and providing for the basics, but as you go up the tax scale, with those things accommodated, there is an increase in your capacity to contribute to the general wellbeing of the community and to pay a bit more tax so that we have decent hospitals and schools that are properly funded, where parents can send their children through the gates of any school in the country and know that there'll be readers for the kindergarten kids to read from and paper and resources for teachers to creatively engage with young people in high school. We trust that our tax dollars, invested on a slightly higher scale by those with a bigger income, benefit our entire community.

I can tell you from this morning, when I was at the Kids' Cancer Project breakfast, that no-one in that room thinks there's adequate funding going into the prevention and treatment of cancer for young people. They were there asking the government, the opposition and anybody who would listen to hear their pleas for further investment in proper research capacity. The reality that we face right at this moment in our country is a choice between Labor and a Liberal government who have no commitment to decency, to fairness or to equity. The attempt to force this inequitable piece of legislation through the chamber should be abandoned.