The Unshackled Waves Ep. 165 Taxathon
The last parliamentary sitting fortnight has been dominated by tax policy. After a one week break from the review show, we return with a taxathon special with the Unshackled’s Political Editor Michael Smyth.
The Turnbull government managed last week to pass its three-stage seven-year income tax package through the Senate that it announced in the May budget in an all or nothing vote in the Senate. Stage one gives a $530 a year tax cut to low-and-middle-income earners. Stage two which begins in 2022-23 brings the tax rate of those earning $90-120,000 to 32.5c and stage three from 2024 onwards sees all those earning 41,000 and $200,000 a year pay 32.5c. Many have questioned the point of legislating so far into the future as we don’t know who will be in government. Labor has said it will repeal stage two and three income tax cuts.
The government was less successful with its company tax cuts package as last Thursday Finance Mathias Cormann announcing the cuts were being shelved until after the Super Saturday by-elections. Cormann at his press conference lashed out at Bill Shorten declaring the by-elections would be a referendum on the parties’ competing economic visions and also at One Nation as Pauline Hanson previously backflipped on her support. Bill Shorten though had a bad week as he said he would repeal tax cuts for businesses between $10-$50 million without consulting with his Shadow Cabinet. This had the business community freaked out and Ross Hart the Labor member for Bass had a trainwreck radio interview refusing to back the repeal of the cuts. Shorten succumbed to pressure and backflipped on Friday, saying he regretted taking the position.
Shorten’s gaffe is a sign the pressure he is under in the lead up to Super Saturday as Labor is behind in Longman and Braddon. Labor’s ad campaign is blatant class warfare and its robocalls attacking Pauline Hanson have backfired with it no longer received One Nation preferences in Logman. Anthony Albanese who won a vote of the Labor membership in 2013 has started sniping by stating his rejection of Shorten’s war on business.
The only major non-tax development was Coalition disunity over the National Energy Guarantee. Tony Abbott and his supporters plus the Nationals have threatened to cross the floor unless there is new investment in coal. The Energy Minister Josh Frydenberg is taking the policy to state Premiers for agreement, even if Coalition MPs do cross the floor it could pass with Labor support. It could be the 2009 emissions trading scheme negotiations all over again, however, things are different this time with most Liberal MPs viewing Abbott viewed as wreaker and this new policy not as extreme as the one Labor would want.
Personal income tax cuts worth billions set to pass with One Nation, Centre Alliance support – ABC News
Labor vows to repeal $120bn in income tax cuts if elected – AFR
Labor MP’s trainwreck interview – The Morning Bulletin
Bill Shorten backflips on tax rise – Sydney Morning Herald
Mathias Cormann Loses Temper Over Company Tax Cuts Failure
Anthony Albanese fuels talk of vying for top job – The Daily Telegraph
‘We have a duty to speak up’: Tony Abbott takes dead aim at Malcolm Turnbull – 2GB