Last week I hosted Labor’s Shadow Member for Finance, Jim Chalmers, to address our local business community on the recent Budget, and Labor’s alternative approach.
Jim presentation was well received – highlighting a number of points of agreement between Labor and the Coalition, but also some important differences.
Labor fully supports the tax changes for low and middle income earners that would come in on July 1. We support the extension of the $20,000 instant asset write-off for small business, and tax cuts for small businesses. We support the crackdown on the black economy and multinational tax avoidance, and, to some degree, the changes on superannuation. And we support new listings on the Pharmaceutical Benefits Scheme (PBS).
Labor wants to see the economy grow, and more jobs created. And we would prefer not to be spending billions of taxpayer dollars servicing the interest bill on the Government’s record debt, which has doubled over the past five years despite positive global conditions.
Labor does not believe the policy settings in Scott Morrison’s Budget serve the objectives of growth, job creation and reducing debt.
We are not paying down debt fast enough, not going about it the right way, and not making the most of our opportunities.
We have $40 billion of new receipts in the Budget as a consequence of the global economy picking up after the GFC.
But we don’t know how long those positive conditions will last. Some of the assumptions in the budget are a bit rosy, given flat wages and international uncertainty. So Labor is approaching the forecasts with caution.
We also have record net debt, twice what this Government inherited, and gross debt over half a trillion dollars.
We do not look favourably upon tax cuts for higher income earners that are seven years in the future.
We do not agree with company tax cuts for big business - especially to the big banks, given the evidence that has been heard by the Royal Commission.
But, as Jim pointed out, we oppose the tax cuts not on ideological reasons, but on fiscal and economic reasons. We cannot afford them, and we can do better.
Labor priorities are about targeting tax relief at low income earners and genuinely small and medium enterprises.
That’s why we would introduce the Australian Investment Guarantee, to give tax relief to companies investing onshore.
We want to give people tax relief so they have the power to spend in retail.
We want to give skilled businesses the workers they need, so we will waive upfront fees to 100,000 TAFE students. It is a priority of Labor to reverse the hollowing out of TAFE that has occurred under this Government.
We will get more from those policies than from delivering tax cuts to the wealthiest Australians and overseas multinationals, and the hollowing out of our human capital.
Labor’s goal is to be the most responsible and ready Opposition – to go through the front door of Parliament with good policies having listened to communities. We are making difficult decisions and getting them right.
We will balance the Budget in the same year as the Government and have bigger surpluses after that.
As Labor has always said, we are about a fairer approach.
This Budget won’t make Australia fairer, more productive, or more resilient.
This was published in Central Coast Business Access in May 2018.