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Speech: Liberals' Tax Plan is a $158bn Mistake

Speeches in Parliament
Mehreen Faruqi 4 Jul 2019

I rise to speak on the government's disastrous $158 billion tax bill that is being rushed through parliament. This is a $158 billion mistake. This is a terribly irresponsible choice that the people of Australia will be forced to wear the consequences of for decades to come. How can this government look the 700,000 people barely surviving on Newstart in the eye and say: 'You know what? We can't afford to increase Newstart. We can't afford to support you, but you won't believe what we can afford to do for the very rich.' Shame on you. I actually half expected you lot over there to be wearing monocles and top hats today, like some British aristocrats. Three million Australians are living in poverty, yet your first order of business is about helping the richest people pay less tax. That is what is at the core of stage 3 of this bill. This giant bribe will turbocharge growing inequality and deliver rivers of gold to society's most well-off, who need it the very least. That's the reality. The majority of the benefits of the Liberal-National plan will go to the top 20 per cent of income earners, including millionaires and billionaires, while the bottom 20 per cent receives just three per cent of the benefits. Let that sink in.

Inequality is rising. We face terrible wage stagnation for working Australians. We know that fewer and fewer Australians are employed in secure, full-time work and that young people face enormous underemployment. Homelessness and poverty are on the rise. Poverty is increasingly feminised, and women face a huge gender pay gap. We know that wages won't rise, jobs won't appear out of thin air and inequality won't reduce without the government planning and investing for it. A climate emergency looms large in the landscape of growing inequality. As the crisis worsens, its health and financial costs will drive a wedge between those who can afford to adapt to the destruction of our world and those who are left to bear the brunt of a total climate meltdown. What would the government do when faced with these twin challenges of inequality and the climate crisis? They would lock the country into a $158 billion giveaway that will only accelerate inequality and leave us without the revenue that we need to build a society that can beat climate change.

While they're at it, they would dismantle our progressive tax system. Why the heck is Labor ditching progressive taxation? Make no mistake, these handouts to the wealthy are nothing short of an existential attack on the principal foundations of our progressive tax system. If the Liberals have their way, our tax system will become less progressive than it has been at any time since the 1950s. They would have us in the absurd situation where someone earning $200,000, nearly four times the median wage, pays tax at the same rate as someone earning less than the median wage. How is this fair?

Tax systems might not be the most exciting thing to talk about, but we can never forget that progressive taxation is the linchpin of an egalitarian society. There's no greater leveller than a truly progressive redistribution of wealth to ensure that vulnerable people are cared for and that we all share in the profits of our labour. At the World Economic Forum meeting at the start of the year, historian Rutger Bregman put it clearly when he said that ending inequality and poverty was quite simple. This is what he said:

Taxes, taxes, taxes. All the rest is bullshit in my opinion. An effective, progressive system of taxation is the building block of a society that wants to be built on collective good and is not built on individual greed.

A progressive tax system recognises that wealth is more often an accident of luck and class than a measure of effort or ingenuity. It places our obligations to each other and society and the betterment of our world at the centre of government. This legislation spells the sad, sorry end of that system.

Debate over taxes goes right to the heart of how governments should serve the people. By choosing to pursue vast handouts to the rich, the government has abdicated its responsibility of life making. That is its responsibility: to give citizens the support, the services and the safety net they need to live a good idea. If we were to accept the idea, as Labor seems to have done, that we should take any opportunity to minimise the life-making work of government and instead give handouts to the most wealthy, then we have already conceded far too much ground to the Liberals' small-government trickle-down crap.

The tragedy of this legislation is not just that the majority of the $158 billion will benefit the most wealthy but that future governments will be unable to use those funds to provide services and infrastructure that benefits everyone. Instead of giving funding to our schools, hospitals, the NDIS and aged care and instead of caring for students, the sick, people with disabilities and the elderly, which is what we need right now, the government is giving tax cuts to millionaires.

We urgently need to lift wages, reverse cuts to penalty rates, fund domestic violence services and raise Newstart and youth allowance. These things are decades overdue, but the government is giving tax cuts to millionaires. We cannot allow the government to forestall the investment and transformation we need to restructure Australia for the 21st century. We could see TAFE and university free for all, fully fund our public schools and make child care free for all families. We could incorporate dental into Medicare and save social housing from the doldrums of underinvestment. We could work to guarantee secure work and a living wage for all Australians. But the government is giving tax cuts to millionaires.

I have to say I am deeply disappointed in the approach Labor have taken to these tax bills. They rightly called the third stage of this plan economically irresponsible and a joke, but then went right ahead and voted for it in the other place and perhaps will do the same here. We need bold, united opposition to the Liberals' giant tax bribe, but instead Labor have been cowed by electoral fear. If they have begun their work in this term of parliament as they intend to continue, then there is much cause for despair. The Greens are fighting the government tooth and nail on this, and I sincerely wish Labor would join us instead of meekly joining the Liberals in taking a wrecking ball to our progressive taxation system and our future. I'm not sure what deals are being done behind the scenes with the crossbench to let this through, but I do know that it stinks. It is exactly this kind of horsetrading and deal doing that Australians hate. Where is the debate of ideas? Where are the principles here? Will you so easily lock Australians out of better education, better health care, better social security? If you go through with this tonight, this affects not only us but many generations to come.

Time and time again Australians say that they want better services. A poll just last week showed that a strong majority, 78 per cent, said maintaining government investments in health and education was the most important thing and it was more important than legislating a tax cut for those on incomes of $200,000. Three-quarters of the sample said people earning more than $150,000 should pay a higher rate of tax than workers earning just $40,000. Yet here we are. This bill is part of the bigger plan to break down our concept of a society where we all look out for each other and instead stoke the idea that people should get what they can and to hell with everyone else. Well, that's great if you're born into money, go to the right schools, are the right colour and have a name that isn't passed over automatically when people are looking at resumes. Please think of these people when you vote on this terrible bill today.

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