By Rachel Clun
Labor has confirmed it will not pursue broader taxes on trusts, abandoning the last remnant of the tax reform agenda it took to the previous federal election as it details more of its plan to strengthen the aged care sector ahead of the May poll.
Shadow treasurer Jim Chalmers said the only tax increase Labor would now pursue would be on multinational companies. The federal government in Tuesday’s budget also revealed plans to improve multinational tax compliance and collect an additional $2.1 billion in revenue over the next four years.
Labor’s shadow treasurer Jim Chalmers with leader Anthony Albanese in Parliament.Credit: SMH
“We don’t have any proposals for tax increases beyond working with other countries to make the multinational tax regime fairer,” Dr Chalmers said in an interview with Sky News on Sunday morning.
“Our priorities are cleaner and cheaper energy, and cheaper and more accessible childcare, dealing with skill shortages, building the digital economy, the care economy and advanced manufacturing.”
On Sunday evening, Labor revealed more detail of its plan to improve aged care, announcing it would cap how much home care users can be charged in administration and management fees, which currently make up about 25 per cent of home care charges according to Grattan Institute research.
“Whether you are in residential care or home care, Australians should have confidence the money they are paying is going where it should – towards their care,” Labor leader Anthony Albanese said.
When pressed on Sunday to confirm that Labor was dropping its 2019 plan to put a 30 per cent tax on distributions from family tax, Dr Chalmers confirmed it was gone.
“We’re not taking that policy to this election,” he said. “There was an agenda at the last election, which we are not proceeding with.”
Also gone from Labor’s tax agenda are policies to curb negative gearing and halve the 50 per cent capital gains tax deduction. Labor took both policies to the 2016 and 2019 elections but dumped them in 2021 as the party geared up for a federal election this year, due to be held in May.
The Greens plan on pressuring Labor to scrap the capital gains concessions and grandfather negative gearing, should Labor win the election.
Greens leader Adam Bandt said both major parties were now in lockstep on tax cuts for wealthy Australians.
“With Labor now joining the Liberals in delivering tax breaks to the wealthy, there will be less in the kitty for schools and hospitals,” he said.
The federal government has been saying a Labor government will deliver higher taxes to Australians. Speaking on ABC’s Insiders on Sunday, Treasurer Josh Frydenberg said Labor was being “flexible” on its tax plans.
“Jim Chalmers, my opponent, [is] saying that he wants to be flexible around tax, he wants to have a budget after the election,” he said.
“Well, the Australian people deserve to know what flexibility on tax for Labor means, not after the election, but before the election.”
Dr Chalmers said Labor’s focus was not on increased taxes.
“We don’t have any proposals for tax increases beyond working with other countries to make the multinational tax regime fairer,” he said.
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