Labor trumps Coalition’s tax cuts
LABOR has upped the tax cut contest by pledging to "almost double" the Government's reductions if it wins office.
A Labor government would dump Coalition plans for big cuts to corporate taxes and concentrate instead on the levies hitting 10 million workers.
And the Opposition Leader argued Labor's scheme would be fairer - a more "progressive" tax system - in which a cleaner would not pay the same rate as a CEO.
This referred to Coalition plans for the same tax rate of 32.5 per cent apply to middle income earners up to those earning $200,000 a year.
The Labor plan is to:
* Introduce the Working Australians Tax Refund at a cost of $5.8 billion over the next four years;
* Support the government's tax plan in 2018-19 and commence the refund from the 2019-20 tax year;
Mr Shorten said the refund would provide a greater tax benefit to 10 million Australians, with over four million getting the full $928 benefit per year - an additional $398 per year.
This would be in addition to the Coalition's increased tax benefit through a more generous Low- and Middle-Income Tax Offset in Tuesday's Budget.
"We can afford to cut your taxes, without cutting services, because unlike the Liberals, we're not wasting $80 billion on a discredited giveaway to the top end of town," Opposition Leader Bill Shorten said in his formal reply to Tuesday's Budget in Parliament.
And rejecting the corporate tax reductions would also allow reductions in government debt.
He said: "We will support the government's tax cut this year.
"And in our first budget, we will deliver a bigger and in our first Budget, we will deliver a bigger and better tax cut."
He signalled a key element of the election campaign Labor will early next year by saying: "Under Labor, you will pay less income tax - because I think you are more important than multinationals, banks and big business."
The Opposition Leader said in the first term of a Labor government a teacher earning $65,000 a year would be $2780 better off gaining an $928 more in tax relief than under the Coalition's plan.
Mr Shorten also used the case of a married couple with one in the Australian Defence Force earning $90,000 and the other working in aged care on $50,000. He said they would be $5565 better off under Labor.
"Labor can afford to do more to help you and your family because we're not giving $80 billion to big business and the big four banks," Mr Shorten told Parliament.
"And because we've already made the hard choices for Budget repair."
This was a reference to existing Labor policy limiting negative gearing, tightening rules on income splitting in some trusts, and ending "unsustainable tax credits for people who pay no income tax" through dividend imputation.