Looking at the speakers' list today for this debate on the Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018, you would have thought that the government had given up on this tax plan weeks after it was introduced. We've seen the same kooky IPA robots get up in this place and talk about trickle-down economics.
Mr Falinski interjecting—
Mr DICK: I'll take the interjection from the member for Mackellar. He's insulted about being described as an IPA supporter. I would take offence too. But I want to start straightaway by acknowledging what has already been placed on record by my Labor colleagues who spoke before me. As we have heard from speakers today, including the member for Fenner in his address to the parliament half an hour ago, Labor will support the government's proposed changes, which are to take effect on 1 July 2018, to lower taxes for millions of Australians by introducing the low- and middle-income tax offset, a non-refundable tax offset of up to $530 per year for taxpayers earning up to $125,333, and increasing the top threshold of the 32.5 per cent personal income tax bracket from $87,000 to $90,000.
We said right from the start that we would support these measures, and we were up-front with the Australian people on budget night about that. The Leader of the Opposition, in his outstanding budget reply speech, made that crystal clear. I want to say tonight that, contrary to popular belief in some circles, the Australian Labor Party is the party of lower taxes. In fact, when it comes to the overall tax-to-GDP ratio, the facts are startling, and I do hope those opposite are listening. The seven highest-taxing Australian governments since 1980 have been Liberal-National coalition governments—not the lowest; the highest. According to the Treasurer's own budget papers, by the time 2021 rolls around, the LNP coalition government will lay claim to having the top 10 all-time highest-taxing governments. That's not a party or a government of lower taxes, nor, certainly, is it a government of jobs and growth.
In complete contrast, the top 10 lowest-taxing governments since 1980 have all been Australian Labor Party governments. Let me repeat that. By 2021-22, the top 10 highest-taxing budgets will all have been from Liberal-National governments, while the top 10 lowest-taxing budgets will have been courtesy of the Australian Labor Party. That's why when it comes to providing real tax relief to low- and middle-income Australians we will go further than the Treasurer and those opposite. I was proud to see that a Shorten Labor government will not only match the raising of the $87,000 tax threshold to $90,000 but will deliver bigger, better and fairer tax cuts for 10 million working Australians.
Mr Falinski interjecting—
Mr DICK: I understand that the member for Mackellar is not interested in real relief for working Australians. His concern while he serves in this parliament is about looking after the top end of town—the millionaires and billionaires of this country. I have a different perspective when I come into this place and the communities that I represent. My priorities are the hardworking men and women of Australia who have helped build this country—people who have gone out and set up businesses, people who have been teachers or nurses, people who have provided the essential services that our country has been built on.
I understand that for members like the member for Mackellar that is not their priority. From listening to the speeches tonight from speaker after speaker, they are interested in one thing: the so-called voodoo economics of trickle-down US-style economics. That has not been proven to be successful in any country in the world. But we're supposed to take their word for it that the Trump-style policies that this government has will somehow benefit the hardworking men and women of my community. Well, they can say all they want. They can get up and go on about it. I would suggest that the member for Mackellar and other members here tonight take a walk in their supermarkets, go down to their shops, talk to shopkeepers, talk to patrons buying a coffee and say: 'Do you feel you're better off under this government? Do you feel that banks and the millionaires of this country are not getting a fair go?' I'll tell you what the answer will be. It will not be that we need trickle-down economics. It will not be that the billionaires and millionaires of this country are doing it tough.
Nonetheless, I am pleased to see that everyone earning less than $125,000 a year will receive a bigger tax cut under a Shorten Labor government compared to the Liberal-National government and be better off by $398 a year compared to the Liberals. With Labor's tax refund a teacher on $65,000 will receive a tax cut of $928 a year and a couple earning $90,000 and $50,000 respectively will receive a tax cut of around $1,855 a year. This is achievable because the Labor Party has made tough calls but they've made the right calls. This includes dividend imputation reforms, negative gearing reforms and not going forward with the $80 billion handout that those opposite, like the member for Mackellar, are obsessed with. They have a laser-like focus on making sure the corporations and banks in this country get a tax break before the working men and women in my community get a tax break.
Mr Falinski interjecting—
Mr DICK: We know that your priority is looking after the special interests of this country—making sure the ultra-wealthy are looked after.
Mr Falinski interjecting—
Mr DICK: We know that's your policy. That is what you want to fight an election on. The member for Mackellar is welcome to come to the communities in Springfield, Springfield Lakes, Redbank and Redbank Plains—suburbs he would never think to visit or even know where they are. If he had a minute to visit the great communities in south-east Queensland that you and I both represent, Mr Deputy Speaker, he'd have a dose of reality given to him. I don't have a lot of millionaires in my community. I say good luck to someone making a million bucks.
Mr Falinski interjecting—
Mr DICK: If the member for Mackellar believes they deserve a $16,500 tax cut, he's welcome to come to my community and explain that—because I can let them know what this government's priorities are. The government wants to be trusted with this bill; but we've heard no reason why it should not should be separated, why it has to be done in full. It will cost over $13 billion over the forward estimates and, according to the government, $140 billion over the medium term—which has received very little scrutiny. The truth is that they cannot be trusted with the Australian economy. Since coming to power, under their watch, net debt has doubled. They don't really talk about that a lot anymore. We don't hear about net debt. We don't hear about debt anymore. So, thanks to this government—thanks to the Prime Minister, the Treasurer, members of the cabinet and members of the backbench—the net debt in this country has doubled to more than $350 billion. Gross debt has now crashed through half a trillion dollars. That's right—half a trillion dollars on their watch, for the first time in history.
Time and time again, we heard about the dangers of debt and deficit—the debt truck driving around the country. Well, the wheels have fallen off that debt truck. It's parked behind someone's house, never to be seen again. It's locked up for good. Now that the debt has crashed through half a trillion dollars, we know that both types of debt are growing faster under this government than under any previous Labor government, which had a global financial crisis to contend with. And this year's deficit, in 2017-18, is six-and-a-half-times bigger than the Liberals predicted in their first horrific budget of 2014. All of this was confirmed through a recent OECD report which stated that the Australian government has added more to their debt over the past five years than almost any advanced company. So not only have we gone through the debt charts and delivered the highest amount of debt in Australia's history but we're now leading the globe in terms of how high our debt is. Throw in the fact that we now know that, by 2022, the top 10 taxing governments will all be LNP governments, and the evidence could not be any clearer that their economic credentials are an absolute shambles. This must be the reason why they're now holding low- and middle-income Australians in some sort of hostage scenario as they try to ram through this $140 billion tax package. Australians deserve better than this.
I now speak to the amendments moved to the bill by the shadow Treasurer that reflect Labor's current position on the government's legislation—namely, removing all elements of the bill that commence on 1 July 2022 and 1 July 2024. Australians deserve full certainty on tax, which is why the government should split the bill, and then the tax cuts scheduled to start on 1 July 2018 can pass without delay. We, as representatives in this place, are often asked by our constituents why we can't show more bipartisanship. Well, here is the evidence on the table, right here, right now. Both sides of parliament can work together to deliver immediate tax relief. If the government split the bill, we could vote for the 1 July 2018 changes only. The Leader of the Opposition and the shadow Treasurer have made it clear that it will receive our full support and this could past instantly. The offer is there and remains on the table for both sides of politics to work together to achieve this for the Australian people. But, like most times when offers of good faith are made, I won't be holding my breath. We know those opposite will always show their true colours when they're playing their political point-scoring games. They're looking after a certain element of the community, the top end of town. We see that in question time after question time, whether it is the Prime Minister or the Treasurer: they're unable, unwilling or deliberately hiding specific details of the plan, including the year-by-year cost beyond the forward estimates. Either the Treasurer doesn't know the answer or is refusing to provide that information. Yet they want the community in Australia, when they haven't released any true details of the overall $140 billion tax package, to just give them a blank cheque. This is a sign of a government that is desperate and, I believe, out of touch with the community.
I'm pleased that our senators have asked Treasury for more detailed financial information—the year-by-year breakdown of the tranches and the individual components of those tranches—so we, the Australian parliament and the community as a whole, can have better information about what the government is proposing. We've also asked for a breakdown by gender, as electorate based information, to ensure we have the best possible information before us, but of course that information has not been provided by the government. Rather than keeping the Australian people in the dark, we need to know what this will mean in the long term. We've already seen analysis by the Australia Institute that the bottom 30 per cent of income earners will receive only seven per cent of the tax cut, which includes the bottom 10 per cent of income earners receiving a mere 1.5 per cent of the tax cut. A simple way to look at it is to say that someone on $40,000 per year will get a tax cut of $445 while someone on $200,000 per year will get a tax cut of $7,255. Sure, those opposite are going to say, 'Well, that's because the person on the bigger salary pays more tax,' but consider this: while someone on $200,000 earns five times what someone on $40,000 earns, their tax cut will be a whopping 16 times bigger. Senior economists have gone further and said that these figures show how inequitable this tax plan is:
Even groups like the IMF and World Bank are warning of the detrimental effects of inequality, including hampering economic growth.
At a time when Australia is suffering record low wages growth and historically high inequality the government has proposed a radical plan to increase inequality.
That's why I was pleased to see that this bill has been referred to a Senate inquiry which will report back on 18 June. I'm hopeful that the inquiry will be used to garner further information from experts on the package. In particular, I believe the inquiry should assess the fairness of the three stages of the package together, with the fiscal risks associated with each stage of the tax cuts, given stage two and three will occur in several years time without an understanding of the prevailing economic conditions. But, considering this government now has a deficit 6½ times bigger than what was predict in their first budget in 2014—that's only four short years ago—how on earth can they be trusted to implement an unscrutinised $140 billion tax plan six years into the future?
If the Turnbull government wants to be judged on the fairness of its so-called package, the government should provide the distributional analysis in the year the full package is in place. 2022 is a long way away; 2024 is further away. For this government to say they're certain they can deliver those taxes in 2024 when they're barely able to hold the government together from week to week is just a joke.
I believe the government's budget fails the fairness test, it fails the families test, it fails the infrastructure test, it fails the health and hospital test and it fails the education test. We need to make sure a tax package delivers for all Australians, not just the wealthy few.
The DEPUTY SPEAKER ( Mr Coleman ): I thank the honourable member for Oxley. I'm led to believe the south-east corner is a very spectacular part of the country.
