Ged Kearney backs Labor tax plan despite Batman backlash

Scott Morrison says Labor policy is “incompetent’’ as Batman candidate Ged Kearney stands by the plan despite voter backlash.

Federal Opposition Leader Bill Shorten, right, and Labor's candidate for Batman, Ged Kearney. Picture: AAP.

Scott Morrison says Bill Shorten’s proposed $59 billion dividend imputation crackdown was turning into a “circus” as he held the line on the government’s claim it would hit people on low incomes.

The Treasurer leapt on the Opposition Leader’s denial pensioners would be compensated for the impact of the policy, declaring the policy was conceived through the “incompetence” of opposition treasury spokesman Chris Bowen who did not realise its full impact.

“This is how they would run the country if they were elected: incompetence on tax policy, not knowing where the impacts would be and then a complete circus as they chase their tail because they didn’t think the mess through,” Mr Morrison said in Sydney today.

“I mean it was obvious to everyone that a tax refund for dividends was always going to be used by people on lower incomes, on lower tax rates. That’s what it was for. Who did they think it was going to hit?

“It’s hitting pensioners, 230,000 of them, who hold their Commonwealth Bank shares or Qantas shares or any number of these shares that they may have picked up when these big companies were privatised.

“They hold it there because it gives them a cash dividend and a tax refund they use for their daily costs of living and Bill Shorten has come with a cruel and brutal slug on them.”

Kearney facing tax backlash in Batman

Batman star candidate Ged Kearney has stood by party leader Bill Shorten to defend the ALP’s latest tax plan, even as she faces a backlash over its potential to hit the poorest people in her electorate.

A defiant Bill Shorten doubled down on the controversial proposal to scrap dividend imputation credits for share owning pensioners, arguing that the current settings overwhelming favoured wealthy retirees.

“We think it’s unsustainable to continue handing away $6 billion and soon to be $8bn disproportionately to people who are wealthy in retirement,” he said.

Mr Shorten did not explicitly respond when asked if the opposition would rule out attaching a means test to dividend imputation changes.

“What we’re not saying is that we’re increasing taxes,” he said, while adding “We will have more to say about pensioners between now and the election.

“What we want is tax relief for middle and low income earners.”

He also dismissed reports that the opposition could consider providing a supplement to low income earners and pensioners adversely affected by the new tax changes as “inaccurate”.

Ms Kearney assured angry pensioners at a town hall on Wednesday night there was “still time” to review proposed changes to dividend imputation credits, and the impact on low income earners.

But on Thursday morning she fell in behind leader Bill Shorten to say the ALP would continue to look at how the changes affected all voters across the board, while suggesting that support for pensioners and low income earners would likely be delivered in other ways.

When asked if she was satisfied with the plan, even though it stood to adversely impact retirees and over-65s which make up almost one-fifth of her electorate, she said:

“I am totally confident and totally satisfied that Labor is the party to look after low income people included retirees and pensioners.

“What I was getting at last time is that there still is time to review how this impacts everybody right across the spectrum and I think Bill’s covered off on the response to that quite well.”

The announcement comes as Labor fights to retain the inner Melbourne electorate of Batman, which goes to the polls in a by-election on Saturday with the Greens tipped by bookies to have a narrow lead.

Ms Kearney refused to say explicitly if the timing of the changes had impacted her chances at winning at Saturday’s by-election.

Bill Shorten with Ged Kearney. Picture: AAP.

She admitted that the proposed changes had sparked a strong response in her electorate, and that she was still fighting to win more support.

“Well, there’s a lot of discussion about it, but I still think it’s going to be a very tight competition and a tight contest no matter what, but I’ve still got a couple of days to get out there and get every single vote that I possibly can.”

Home Affairs Minister Peter Dutton said Mr Shorten was after money so he could carry out a “tax and spend” agenda.

“One of the great maxims in politics is look not on what someone says but what they do and Kevin Rudd intro new taxes and wrecked the budget and the economy when he got into government, at least Bill Shorten is being honest enough to say that he is preparing to do the same from opposition and that is the only positive thing I can say about it,” Mr Dutton told Sydney radio station 2GB.

Minister for Home Affairs Peter Dutton. Picture: AAP.

“You don’t raise $59 billion in tax, which is what he is proposing, unless you are impacting on millions of Australians and as it turns out, because they have botched the design of this it is going to impact particularly on self-funded retirees and pensioners, in particularly part pensioners.”

Mr Dutton said plan would be as bad as its negative gearing proposal which would “completely destroy the housing market in some parts of the country”.

“When you add all this up it shows that they don’t think it through but all they are after is money because they tax and spend,” he said.