Coalition Family Tax Revolt Wayne Swan - Shadow Minister for Family and Community Services

Doorstop Interview

Transcript - Brisbane - 11 December 2003

SWAN: Alan Cadman and his back bench colleagues have today blown the whistle on their own Government – the highest taxing Government in our history. Parents don't work extra overtime, mum doesn't go back to work to earn a bit of extra income, to give John Howard and Peter Costello sixty cents or more of each additional dollar they earn. There are over one million families in this country, many who earn $30,000 to $80,000 odd a year, who lose over 60 cents in each additional dollar they earn after tax and the withdrawal of family benefits. What Mr Cadman has done today is highlight the financial pressure Howard Government policies are putting on families. It is about time those families on modest incomes received some priority and it is about time the Prime Minister and Treasurer fessed up to this problem instead of ignoring it. Austrian families deserve relief – families who are working hard to make our economy strong do deserve some tax relief. They are families on modest incomes who are paying more tax, paying more for services and are being financially squeezed.

JOURNALIST: Peter Costello sys the idea is dead in the water, he says the tax free threshold for families is already $12,000?

SWAN: Well the problem with Mr Costello is he won't admit evidence from the Prime Minister's own department showing one million Australian families are now paying over 60 cents in each additional dollar they earn on overtime. These families don't sacrifice family time; they don't work harder to give Mr Howard and Peter Costello 60 cents in each additional dollar they earn – money they earn to feed clothe and educate their children.

JOURNALIST: Is the threshold currently at $12,000 as the Treasurer claims?

SWAN: The Treasurer is engaging in semantics. The practical result of the Coalition's tax and social security system is that more than one million families are paying more than 60 cents in each additional dollar they earn after tax and the withdrawal of social security benefits. This must be a priority for reform. It is not a priority for reform for the Howard Government. It is taxing people more and making them pay more for services like education and health and is also taking away family payments.

The healthy budget surplus is being built on the backs of hardworking Australian families who are paying more tax than is fair. That is the problem. It is about time the Treasurer admitted it. Alan Cadman has said so today. It is about time we had some action. What are we looking at here, is this the beginning of the Cadman challenge?

JOURNALIST: So you don't believe this plan will fly?

SWAN: Well Treasurer Costello has denied in Parliament there is problem at all, despite evidence from the Prime Minister's department, and a raft of economic think tanks.

JOURNALIST: Where do you stand on increasing the tax thresholds?

SWAN: That is a question of reform. The Government won't admit at this stage that there is a problem. Labor's policy is clear. First things first. The first thing we must do is fix up our health and education systems. Second we need to provide relief to low and middle income families who are paying very high effective marginal tax rates on overtime and additional income. That will be Labor's priority. How we go about achieving that will be announced when we announce our tax policy.

JOURNALIST: Mr Latham has said that he supports change at the top end; do you support him in that?

SWAN: Mark Latham has said first things first. First of all we must fix health and education….

JOURNALIST: But he hasn't ruled out a change at the top end has he?

SWAN: Look the priorities are these, and Mark outlined them as recently as yesterday. First we have to fix up health and education. Secondly we need to provide relief to low and middle income earners who are paying more than 60 cents in every additional dollar they earn. These are the people who make the economy strong and they deserve some relief. Beyond this we will see what we can do. It is not good enough for the Prime Minister and Treasurer to deny it is a problem. Mr Cadman today has signalled the attitude of the Coalition backbench. What we want to see now from the Government is less talk and more action. Struggling Australian families on modest incomes who are making the economy strong do deserve some relief and they must be a priority.

Ends. E & OE - PROOF ONLY