PARLIAMENT HOUSE, CANBERRA: Mr TUDGE (Aston) (1.23 pm)—I rise to oppose the Tax Laws Amendment (Temporary Flood Reconstruction Levy) Bill 2011 and the Income Tax Rates Amendment (Temporary Flood Reconstruction Levy) Bill 2011, and I do so as a member of an outer metropolitan seat in Melbourne in which families and members of the community are feeling the increases in the cost of living, with many already in distress.
I say at the outset that, along with my coalition colleagues, I am committed to doing everything necessary to rebuild communities tragically hit by floods and cyclones. There is no debate about the need to rebuild. There is no debate about the need for the Commonwealth to spend significant resources to assist in the process. The issue here is purely how to raise the money necessary for the rebuild. The government believes it should be raised through a tax. We believe it should be raised through making savings. A tax should be a measure of absolute last resort, not a thing that is reached for as the first item. Unfortunately, however, this is the pattern of this government. If they see a problem, they raise a tax.
There are savings to be made in the budget. The shadow Treasurer, Mr Joe Hockey, has outlined more than $2 billion in savings that could be made. An offer has been made to sit down with the government to go through the budget and to find saving measures in a bipartisan fashion. The government itself has admitted that savings can be made. It has said that if the reconstruction bill is higher than forecast then it will find the additional money from savings. This is an admission in and of itself that there are savings to be made. Our argument is that these savings should be made first, as the first measure, not down the track if, all of a sudden, we need to find further money.
The tax in question here is not an insignificant one. It is going to be imposed on every single individual earning more than $50,000. People in my electorate are already feeling cost-of-living pressures, people who are earning not much more than that. This will just add to their burden. I have talked in this parliament in the past about the price rises that are occurring: electricity has risen 42 per cent since 2007, gas prices are up 29 per cent, water is up 46 per cent, interest rates continue to go up. These things are going up faster than wages or the pension.
I have voiced in the parliament before my concern about Labor’s plans for the Murray-Darling, which will increase food and grocery prices. I have voiced my concern about their mining tax, which will have a flow-on effect on every single product that uses those materials, including electricity generation. I have voiced my concern about the National Broadband Network which, according to Optus, will increase the cost of basic telephony charges. I have voiced my concern about the proposed carbon tax, which will increase electricity prices by 25 per cent. And now I want to add my concerns about the floods tax.
People in Aston are very generous people, they have given generously for this cause, but they are feeling the pinch. For example, Danielle Scorer, from Wantirna South in my electorate, is a single mother. She represents the views of many when she says:
I feel as though the government and big companies are taking everything they can. I actually feel like I will never be able to get ahead My financial pressures are mounting with dramatically rising living costs. My gas, electricity and water costs are sky high and I am trying to reduce my bills wherever I can I would like the government to understand that they have got things very wrong if they think someone on $50,000 [per annum] is well enough off to afford their flood levy.
Similarly, Mark Maloney from Ferntree Gully states:
We are a single income house hold. We have three children 3 years and under We have next to no spare income as it is and now we will find ourselves with 450 odd less per year [due to this proposed tax].
It is families like these ones that will be hurt by this levy. It will put extra strain on them at a time when they are already hurting from the rises in electricity and other costs that I have talked about. The Prime Minister says that only those who can afford it will be paying this tax. She implies that it is only for the rich, but of course that is not the case.
The tax will come into play for every single individual earning above $50,000. The average salary in Australia is $65,000. People in our communities who are earning $50,000 are not rich, particularly those who are trying to raise a family. They are paying for petrol. They are paying for toll roads, for child care, for uniforms. These people are not those who can afford it, as the Prime Minister would say.
We also need to be mindful that this new tax is a disincentive to all Australians to donate to disaster relief efforts in the future. As many other speakers before me have pointed out, the government, before suggesting the need for this tax, was calling on Australians to be generous and to donate generously—and indeed they did. But what will occur in the future, the next time the government calls on Australians to donate generously? In the back of their minds they will be thinking, ‘We’ll do that but then the government, a couple of months later, will come in and slug me in any case, so maybe I’ll just wait to see if they’re going to do that.’
The Labor Party consistently raises other levies which the Howard government introduced and which, of course, the coalition supported. We introduced those levies when we were in government and we did, indeed, support them. But when we introduced a levy —say, for the gun buyback—it was at a time when no-one would have argued that there was significant fat in the budget. It was at a time when we were trying to reduce the enormous debt left by the previous Labor government. Aggressive savings had already been made in the budget by the government in previous years. Further, we were not raising other taxes at the same time. People were not feeling the pinch to the same extent that I believe they are today with cost of living pressures.
Today, few people would argue that there is not fat in the budget. Indeed, the government itself says that savings can be made if necessary. Few would argue that the government has not wasted billions upon billions of dollars on pink batt disasters, on Green Loans schemes and on other green schemes. Countless billions of dollars were wasted through the Building the Education Revolution program with overpriced school halls. This new tax, additionally, comes on top of all the other new taxes that the government introduced last year and the proposed new taxes that the government is going to be introducing this year.
The federal government has an obligation to assist with funding for the repair and rebuilding of public infrastructure as well as providing financial assistance to people in need. The coalition stands shoulder to shoulder with the government in the commitment to do so, but we do not need a new tax which will hit those who have already donated, those who draw from their retirement funds to live, those who are flood victims themselves and those who simply cannot afford more taxes.