ABC NEWS RADIO
MONDAY, 1 JULY 2019
Subject: Tax cuts.
SANDY ALOISI: Let's speak now to Labor MP Andrew Leigh, who joins us from Parliament House in Canberra. Mr Leigh, good morning. Thank you for your time.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Pleasure, Sandy. Great to be with you.
ALOISI: The Prime Minister says Labor's threats to block the package are an act of belligerent arrogance. Will you accept the election mandate and backed the Government's plans in full?
LEIGH: Our proposal is to ensure that more Australians get bigger tax cuts sooner. That's what the economy needs and that's what Australians need. It’s the 1st of July today and that’s a day that marks 700,000 Australians beginning to lose penalty rates under a Morrison Government. Some will lose up to $2,000. We know that the economy is having all sorts of problems. Forecasts out today show that twenty leading Australian economists universally disbelieve the government's household spending forecasts. You've got gold prices at record highs, bond prices at record lows, and you’ve got unemployment higher than it should be. The Australian economy needs stimulus now. Australians need tax cuts now, not off in 2024.
ALOISI: So will you back the tax cuts in full, all three tranches?
LEIGH: Our focus is on getting our amendments through, which will ensure that every Australian gets a tax cut in this term of parliament. We're really concerned about the prospects for the Australian economy and about the fragility of the world economy. Whether it's Brexit or a trade war, whether it's for concerns about the US possibly going into a further slump or the concerns around the fragility of the Australian economy, we need to make sure that we've got that stimulus for the Australian economy right now. And that if the economy does turn worse, that we haven't locked in very expensive tax cuts for five years hence -
ALOISI: So does that mean-
LEIGH: That we’ve actually got the fiscal firepower-
ALOISI: I'm sorry to interrupt you, but I don't think you quite answered my question. Does that mean that the ALP will not back the third tranche of this tax package?
LEIGH: Our focus right now is on deferring that third tranche and bringing forward the second tranche, making sure everyone gets a tax cut immediately. That's the economically responsible thing to do. The reason the government has tied the stage three tax cuts to the other two is because they know that they wouldn't pass the Parliament on their own. The Coalition aren’t putting in place responsible economic decisions for the way the economy is now. Hope isn't a plan. The government is currently focused on trying to lock in place very expensive tax cuts, a significant share of which goes to the 3 per cent of Australian taxpayers who earn more than $180,000.
ALOISI: So the government has said that unless the Labor Party votes for the entire three tranches of this tax plan, then nobody will get a tax cut. What would you say to Australian people who say we want a tax cut right now?
LEIGH: There's only one party that believes you should have had a tax cut today and that's Labor. We were ready to vote for the tax cuts back in April that flowed immediately from the 1st of July. Scott Morrison arrogantly said he didn't need legislation. Turns out he did. And today marks his first broken promise, because Australians aren't getting this stage one tax cut that was passed today. Stage two, we'll bring it forward. When it comes to stage three, we believe it should be deferred. It's not the not the economically responsible time to be putting this in place. Sandy, tax cuts have opportunity costs. The more that we lock in on tax cuts, the less we can do on schools, on hospitals, on raising Newstart or investing in infrastructure. All of those things are important priorities, all of those become harder when you lock in very expensive tax cuts in the future.
ALOISI: And I'm sorry to have interrupted you, but just quickly-
LEIGH: Not in the least.
ALOISI: Labor will back parts one and two, but not three. Am I clear?
LEIGH: Labor will back part one, will move to bring forward stage two - so people actually get a tax cut in this term of Parliament, rather than the next term of Parliament - and stage three we believe should be deferred for consideration further down the track. That's the economically responsible thing to do when we're just not sure what the Australian economy is going to do. Maybe things will be fine. Maybe these 20 top economists today are entirely wrong and the government's heroic household spending forecasts are right. But they’re the forecasts on which the government has premised it's expensive 2024 tax cuts. And if those forecasts don't bear up, we need to be able to respond quickly to save jobs as Labor did during the global financial crisis, not be locked into expensive spending that ties the hands of policymakers and means that a whole lot of people lose their jobs in the downturn.
ALOISI: Andrew Leigh, I thank you for your time.
LEIGH: Absolute pleasure.
Authorised by Noah Carroll ALP Canberra.