Stage-three tax cuts irresponsible, says Labor
Labor has signalled it will resist moves to bring forward top-end income tax cuts in Tuesday’s federal budget, branding the $95bn ‘stage-three’ cuts as irresponsible and unfair.
Labor has signalled it will resist government moves to bring forward top-end income tax cuts in Tuesday’s federal budget, branding the $95bn “stage-three” cuts as irresponsible and unfair.
Opposition Treasury spokesman Jim Chalmers said the party was keeping its options open, but would not rule out opposing the cuts for higher-earners, or going to the election with a pledge to repeal them.
The budget is expected to fast-track the government’s already legislated stage-two tax cuts, due to commence in 2022, and possibly the final stage-three cuts, which were scheduled to kick in from 2024.
“We’ve said throughout that stage three is the least affordable, it’s the least responsible, it’s the least fair, and it’s the least likely to get a good return in the economy because higher income earners are less likely to spend in the economy and it’s that spending power that we need in our shops and in our small businesses around Australia,” Mr Chalmers told the ABC’s Insiders program.
“It won’t surprise people to learn that remains our view about stage three, especially if it comes at the cost of other more important initiatives and more cost-effective initiatives like social housing, and in other parts of the economy which need help.
“We’ll finalise our approach when we actually see the package of tax cuts.”
Labor was last year forced to wave through the stage-three cuts for higher-income earners after the government refused to split them from stage-one and stage-two cuts applying to lower-income earners.
The stage-three cuts would remove the 37c in the dollar tax bracket and lower the 32.5c rate to 30c, lifting the threshold for the top 45 per cent rate to incomes above $200,000. The changes would leave 94 per cent of taxpayers paying a marginal rate of no more than 30c.
Mr Chalmers welcomed a new 50 per cent wage subsidy to support businesses to employ 100,000 new apprentices and trainees.
“Labor welcomes any support for apprentices, trainees, young people in particular, and any efforts to undo the mess made of training by the Liberals over the last seven years or so,” he said.
“We can’t afford a lost generation of workers sacrificed to this recession and unable to get ahead in the recovery.”
Under the new measure, employers will be eligible for 50 per cent of the wages for a new or recommencing apprentice or trainee, up to $7000 a quarter, to September 30, 2021.
Mr Chalmers said Labor’s budget response would be “carefully calibrated to the economic conditions … It will prioritise jobs above all else but also supporting communities and supporting people doing it tough during this recession.”
Labor has called for a ramping up of infrastructure spending in the budget — which the government is set to deliver.
Anthony Albanese told the National Press Club last week that Labor would invest in roads, railways and social housing to get people into work and build the economic infrastructure of the future.
“We’ve got to get this nation back to work. And fast,” the Opposition Leader said.
“To do that, we must generate the economic activity that will create new jobs quickly while also boosting our productivity.”
More Coverage
Youth mental health a worry for families
Concerned about a young loved one’s mental health? You’re not alone, and starting a conversation about it with them is challenging. Here’s some advice on what do.
Restaurateur charged over Nazi sign at protest
High-profile restaurateur Alan Yazbek has been revealed as the protester arrested after allegedly holding up a swastika sign at a pro-Palestine rally.