Opposition Leader Peter Dutton says Labor’s tax cuts are a hoax. Photo: Michelle Kroll.
The Coalition has voted against the budget’s tax cuts, which the government introduced with legislation to parliament Wednesday morning (26 March) in a bid to force the Opposition’s hand.
Introducing the tax cuts bill immediately after delivering the budget was an unusual move on Labor’s part – a tactic revealing just how poised Prime Minister Anthony Albanese is to call the election.
Opposing tax cuts is also unexpected from the Coalition.
But Peter Dutton described the extra tax cuts of up to $268 in the first year and $536 the next as a “hoax” and promised a better offer in his budget reply speech on Thursday night.
Labor’s bill cuts the 16 per cent tax rate to 15 per cent next year and 14 per cent after that, and will cost the budget $17.1 billion over four years.
The Opposition Leader has gone against usual conventions and dismissed the proposed cuts.
“What’s obvious here is that a 70 cent a day tax cut in 15 months’ time is just not going to help families today who are really suffering,” Mr Dutton said.
“Labor’s created not just an economic crisis, not just a housing crisis, but a crisis of confidence, and there are a lot of people across the country who are working harder than ever before and they just know that this government’s budget has made it even harder for them to pay their bills.
“There’s nothing structural around the energy system, of trying to address grocery price problems that people are experiencing every day in their own budgets, and that’s the missed opportunity of this budget.”
Nevertheless, Labor’s tax cut bill passed in the House of Representatives (91 to 55) and is expected to pass in the Senate by the end of business Wednesday evening.
A guillotine motion forces a final vote in the Senate at 10 pm, and the government has already received almost all of the support it needs from the crossbench.
Should it pass both Houses, it would mean Mr Dutton would have to legislate to undo the tax cuts if the Coalition wins the election.
Shadow treasurer Angus Taylor described the budget as being one for “the next five weeks, not the next five years”.
He defended the Opposition’s decision to oppose the tax cuts.
“This is a budget for an election, not one for our country’s future prosperity,” Mr Taylor said.
“At a time when living standards have suffered the biggest collapse on record and when the security environment is the most dangerous since the Second World War, Labor’s budget has failed to deal with the economic and national security challenges our country faces.
“Labor’s cruel hoax tax changes in 2026-27 fail to restore the standard of living you have lost after three years of Labor.
“The Coalition will not support these tax changes that do nothing to address the collapse in living standards under Labor.”
Treasurer Jim Chalmers says the election will be about the economy, and that’s what he wants. Photo: Michelle Kroll.
It all allowed Treasurer Jim Chalmers to use his National Press Club post-budget address on Wednesday in the Great Hall of Parliament House to point out that Mr Dutton had “backed in” Mr Taylor in a “dramatic break” from the Coalition’s approach.
“Today they voted for higher taxes on Australian workers,” Dr Chalmers said.
The Treasurer outlined his view that the imminent federal election will be fought on the economy.
The election will be a referendum on Medicare, he said, and a “simple choice” between Labor’s tax cuts and cost-of-living assistance and Mr Dutton.
“Above all else, it will be an election about the economy and that’s exactly what I want,” Dr Chalmers said.
With the budget delivered and the Treasurer’s press club speech done and dusted, the next thing for Labor to set an election date.
In the meantime, all eyes will be on Mr Dutton on Thursday and what he will promise during his budget reply speech.
“We’ll make a very significant announcement on Thursday night,” the Opposition Leader promised.
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