Income tax relief delayed as Opposition refuses to back Malcolm Turnbull’s package
“SNOB,” “sycophant” and “suck up” are among the insults Malcolm Turnbull and Bill Shorten hurled at each other today as the income tax cut row turned vicious.
Money
Don't miss out on the headlines from Money. Followed categories will be added to My News.
“SNOB,” “sycophant” and “suck up” are among the insults Malcolm Turnbull and Bill Shorten hurled at each other in Parliament today as debate over income tax cuts turned vicious.
The leaders of Australia’s two political parties both fired up in a slanging match in Question Time after Labor opted to oppose the final two stages of the government’s $144 billion personal income tax plan.
“You are an unmitigated snob,” the Labor leader shouted at the Prime Minister, telling him to “sit down” after Mr Turnbull answered a question about whether an aged care worker should aspire to be a wealthy banker if they wanted a bigger tax cut.
Mr Turnbull had said an aged care worker was entitled to “aspire to get a better job” and was “entitled to get a promotion, and earn more”.
The Prime Minister’s fired back with a heated rant calling Mr Shorten “grovelling” and a “sycophant”.
“Sit down, that is what he’s saying to every Australian who wants to get ahead,” Mr Turnbull said.
“Sit down, he says. He says I am a snob.
“Honestly, that is what he said. This is the man who sucked up and grovelled to Dick Pratt like there was no tomorrow.
“He took three trips overseas, he drank the champagne, he sucked up to the big end of town. He sold out the workers and you know what, Mr Speaker?
“I had seen a lot of wealthy people in my days, and ... I have never seen anybody more sycophantic in the presence of a billionaire than a Labor politician, and none more so than this sycophant, ... this man who abandoned workers while he tucked his knees under the table and sucked up to Dick Pratt right up until it was no longer useful for him to do it. No integrity, no consistency, no loyalty.”
The pair had earlier clashed over Labor’s position on tax cuts, with Mr Turnbull accusing Labor MPs of being a “privileged elite” who “want to keep workers in their place”.
He accused the party of holding back workers who aspired to higher paying jobs by blocking tax cuts for wealthier Australians.
“We believe that every Australian is entitled to aspire to have great ambitions, and high hopes to seek to do their best, to seek to get the best job, the biggest business, to realise their dreams - that is what we stand for. It is what Labor used to stand for, but no more,” he said.
“This privileged elite opposite, they want to keep the workers in their place.”
Deputy Labor leader Tanya Plibersek was kicked out of Question Time after arguing with Speaker Tony Smith over Mr Turnbull referring to her remarks about being “mystified” by the government’s use of the word “aspiration”.
The tax cuts for low and middle income Australians are likely to be delayed as federal Labor stares down the government in a high stakes game of chicken over its “irresponsible” $144 billion personal income tax plan.
"Get a better job". This Prime Minister's message to working and middle class people. Disgraceful. #auspol pic.twitter.com/xMwQbcukvF
— Bill Shorten (@billshortenmp) June 19, 2018
Mr Shorten confirmed this morning Labor will back only stage one of the tax cuts, which will either force the government to split the bill or delay tax relief for millions of Australians if it refuses.
Mr Shorten dubbed stage two and three of the government’s package a “tax trick” and an “irresponsible plan from an irresponsible government”.
“No responsible opposition would vote for it,” he told reporters at Parliament House.
“Our commitment to the Australian people is this: we will vote for tax cuts for you right now and if Mr Turnbull insists in playing silly political games over the next two weeks, our commitment to 10 million working Australians is when we are elected we will provide tax cuts for you which will actually be nearly double what the government is offering in this fortnight.”
Treasurer Scott Morrison is adamant the government will take an all or nothing approach to its tax plan, passing all three stages or none.
The brinkmanship comes in the lead up to five by-elections across the country.
Stage two of the tax plan would initially lock in the tax relief for low and middle income earners and lift the threshold for the 32.5 per cent tax bracket from $87,000 to $90,000 and then to $120,000.
Stage three would then abolish the 37 per cent tax bracket in the later years.
Mr Shorten said if Prime Minister Malcolm Turnbull thought stage two and three were “so fantastic”, he should put them to the Australian people at an election.
“We say to the government that if you want to talk about promises in more than two election cycle’s time, take these radical proposals to the people of Australia and see what they think about them,” he said.
“What we also say to the Turnbull Government is that you should not hold hostage tax relief for tradies and teachers so that you can give the top end of town tax cuts in seven years’ time.”
Shadow Treasurer Chris Bowen said 70 per cent of Australians would be better off under Labor’s plan.
He dubbed stage three “expensive”, “unfunded” and “unfair”, pointing to modelling which showed they would likely cost $10 billion a year.
Labor would also oppose stage two because under the government’s plan, the tax offset for low and middle income workers was only temporary in the first stage and Labor intended to implement a permanent, larger tax offset for those workers if elected.
Opposition MPs unanimously voted for the position at the party’s caucus in Parliament House this morning.
Mr Bowen reassured Australians the position would be unlikely to delay their tax relief, saying the bill could voted on at any time over the next year before they were due to receive a rebate from July 1, 2019.
And if the tax cuts did not pass under the current government, he said an incoming Labor government would retrospectively make the changes and refund Australian workers with the missed rebate at the end of that financial year.
Earlier, deputy Labor leader Tanya Plibersek called the cost of stage three of the tax cuts “highly irresponsible”.
“We are very, very critical of stage three of the tax cuts — $42 billion, all of it, goes to the top 20 per cent of earners,” she told Sky News.
“You’d get a surgeon who’s earning five times as much as a nurse gets a tax cut that’s 16 times larger.
“Someone earning a million bucks a year gets a $7000 tax cut, the average retail worker gets a $10 a week tax cut but he or she is also facing up to a $77 a week cut in their penalty rates, so we think stage three is unfair and we’ve said that all along.”
Labor has promised to support the first phase, which would deliver up to $530 back for low and middle income earners, and then to increase the relief to $928 for those workers if it wins government.
The government could still pass its tax package through Parliament without Labor if it can secure the support of eight out of ten crossbench senators.
Centre Alliance senator Rex Patrick yesterday confirmed he would support the bill in full, securing two votes.
Crossbenchers Cory Bernardi, Fraser Anning, Brian Burston, David Leyonhjelm and Derryn Hinch will also back the plan in full.
One Nation leader Pauline Hanson, who now controls only two votes in the senate, has indicated she will only support the first two phases of the plan.
Independent Senator Tim Storer only supports the first tranche of cuts and is also urging the government to split the bill.
Next week, the Senate will resume debate on the remainder of the government’s 10-year business tax plan, which will reduce the corporate tax rate from 30 per cent to 25 per cent.
The government fell two votes short just before Easter to get the plan passed and since then One Nation senator Pauline Hanson has reneged on an agreement to support it.
— with AAP