Federal tax cuts: Turnbull and Shorten go head to head
AUSTRALIANS could face the first “roll back” election in almost two decades after Labor vowed to reverse tax cuts for workers on more than $95,000 if the Turnbull Government wins support for its package.
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AUSTRALIANS could face the first “roll back” election in almost two decades after Labor vowed to reverse tax cuts for workers on more than $95,000 if the Turnbull Government wins support for its package.
An emboldened Bill Shorten set up a political battle over income tax at next month’s Super Saturday by-elections and the next federal poll, with the Labor leader assuring 10 million Australians they’d be better off under his plan.
The government was on Tuesday nigth just one Senate vote off passing its $144 billion three-stage, seven-year tax cut package — hoping to gain support from Pauline Hanson’s One Nation.
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Fired-up Prime Minister Malcolm Turnbull told the Herald Sun: “Bill Shorten will go to an election promising to increase taxes on all Australians. Labor wants to impose a tax hit on teachers, police officers and nurses who aspire to a promotion and a pay rise.”
But Mr Shorten has dared the government to blink and put forward only the first stage of its policy, saying if it wanted the entire plan now then it should “put it to the people”.
“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,” Mr Shorten said.
He declared the government’s tax plan “irresponsible” and said Labor would only vote for the first stage of the cuts, worth $22 billion and due to take effect next month.
The first stage delivers an end-of-financial-year rebate worth $530 to 10 million workers from July 1, and lifts the top threshold of the 32.5 per cent tax bracket from $87,000 to $90,000.
The government is resisting calls from Labor and some crossbenchers to implement just the first stage.
Mr Shorten said stages two and three — flattening tax rates and shifting brackets in 2022 and in 2024 — were unaffordable and off in the “never-never”. He said Labor would repeal both if it won office and implement its own tax plan.
Under Labor’s policy, the tax rebates to the same 10 million will be 75 per cent higher than those paid by the Coalition, with people earning between $48,000 and $90,000 getting up to $928 a year.
Labor’s package would deliver smaller payments than the Coalition for those earning up to $125,000.
WHO STANDS WHERE ON PERSONAL INCOME TAX CUTS
Turnbull Government requires 39 votes to push through stages 1, 2 and 3.
STAGE 1:
From July 1, 2018, 10 million Australians will receive an end-of-year rebate bonus and about 4.4 million will gain the full $530. The government will provide a tax cut of up to $135 a year to about 3 million people by increasing the top threshold of the 32.5 per cent tax bracket from $87,000 to $90,000.
STAGE 2:
In 2021-2022, top end of 19 per cent tax lifted from $37,000 to $41,000 and low income tax offset increased from $445 to $645 from July 1, 2022.
From July 2022, the top threshold of the 32.5 per cent tax bracket will be increased from $90,000 to $120,000, providing a tax cut of up to $1350 a year.
STAGE 3:
From July 1, 2024, the top threshold of the 32.5 per cent tax bracket increases from $120,000 to $200,000, removing the 37 per cent tax bracket completely.
YES TO ALL STAGES:
31: Liberal/Nationals
7: Derryn Hinch, Brian Burston, David Leyonhjelm, Fraser Anning, Centre Alliance
UNDECIDED ALL STAGES:
Pauline Hanson’s One Nation
YES TO STAGE 1, NO TO STAGE 2 & 3:
26: Labor
NO TO ALL STAGES:
9: Greens
1: Tim Storer
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