Because Duncan’s our mate

Labor’s fairness debate requires facts and a fair go for all.

In the 2008 US presidential election, Joe the Plumber was thrust into the limelight because he wanted to buy a small business and was worried his realisation of “the American dream” would expose him to higher taxes under Barack Obama’s plan. Here and now, Duncan the Q&A guest is in the limelight because although he pays no net tax and relies on taxpayers for income, housing, education and other support, he begrudges a tiny tax cut for those on $80,000 or more a year. For his resentment, Duncan Storrar is lauded by Labor, Greens and the ABC.

Mr Storrar is not the issue — we all wish him and his family the best — but his case goes to the fulcrum of the so-called fairness debate that Bill Shorten is determined to put at the centre of the election campaign. By lionising Mr Storrar, Mr Shorten endorses his view that he should receive a larger hand-out from the budget. On Q&A Mr Storrar asked for an increase in the tax-free threshold. This was tripled from $6000 to $18,200 less than four years ago as part of the carbon tax compensation package. The Coalition abolished the carbon tax but kept the compensation, so Australians still have to earn at least $18,200 before they pay a cent of income tax. In reality, thanks to family tax benefits and other payments, almost half of all households pay no net tax. Yet, to take up Mr Storrar’s argument, some would begrudge a tax threshold change to stop someone on average earnings being bumped up from a 32.5 per cent tax rate to the second highest rate of 37 per cent. Only people who pay tax can benefit from such changes — the people who are paying for the income, benefits and services of those who don’t or can’t pay. Begrudging efforts to provide tax relief, especially when it is aimed at boosting economic growth and employment opportunities, seems a little unfair.

Mr Shorten must explain how taking more from tax contributors (at an effective top rate of 49 per cent) to give more to others helps fairness. And putting fairness aside, unless more are encouraged to become contributors, this envy-driven emphasis on wealth redistribution over wealth creation can only become financially unsustainable.