BEN DAVIS:
Scott, good afternoon.
TREASURER:
G'day, Ben.
DAVIS:
Congratulations. It is a win for us all, I think. When will workers begin to see more money in their pay packs and how much?
TREASURER:
That starts from 1 July and the way that our first part of the plan works is that over the course of next year, if you're earning up to about $90,000 you will be able to get tax back as an additional tax return on what you do next year and that can be up to $530 for that year. So that's more than a new set of tyres on the car. It all comes in one go…
DAVIS:
So that's a rebate, is it?
TREASURER:
It comes back as an additional return on your tax return.
DAVIS:
Okay.
TREASURER:
So you do your taxes as normal and then on top of that, you get a $530 additional refund on your tax return so that starts the next year and then over the course of the full period of the plan, we get to the point where we abolish that 37 cent tax rate. So 94 per cent of Australians won't face a marginal tax rate higher than 32.5 cents. So, look, it's a plan that goes for some years but people always say to politicians, "you need to think more long-term." And what this plan does is deals with the immediate needs of low and middle income earners right now and then works through by dealing with bracket creep by changing the schedules of how they work and ultimately, reduces a whole tax bracket. So, over someone's entire working life, for most working Australians, they won't be subject to bracket creep because we've got one big large tax bracket and it's only a maximum of 32.5 cents. But the other way we're doing it is we're not putting anybody's taxes up to pay for it. No one's taxes are going up. Under us, people's taxes are coming down.
DAVIS:
Treasurer, on one of those, you say you never look long-term and I applaud you for that – seven years though – we've heard Labor, they've said that if they get power, if they get keys to the Lodge, they will be winding back…
TREASURER:
They'll put taxes up. That's right. And they'll put taxes up for small business as well. They'll reverse the tax cuts we've passed for small and medium sized businesses. Labor's got more than $200 billion of higher taxes – taxes on housing, with negative gearing for example. One in five police officers negatively gear and they're going to turn off that for police officers in the future and nurses and teachers who I know do that, as well. They just want more tax.
DAVIS:
Do you see this as an insurance policy? It's: "keep us in for seven years and you'll see these tax cuts through."
TREASURER:
I see it as a plan that's now been turned into law and I think Australians should have that certainty to know that as each year passes, the more effort they're able to have the opportunity of putting in, the extra shifts they get or hopefully, if people can get a promotion – well, good for them – but sometimes just inflation will take your wage up. Hopefully, we'll see – and I think we will – wages improve over the next few years and you don't want to see that extra wage eaten away in higher tax rates. And so, this gives people that clarity, that certainty, that this is what the tax rates will be under us. Now, I don't think Labor should change them. I think it's amazing that they're going to the next election and say, "vote for us. Vote Labor and we'll put an additional $70 billion tax burden on personal taxes in Australia." That doesn't sound like a particularly flash idea.
DAVIS:
Now, that's what we're going to get. What does Pauline Hanson and One Nation got to get their votes? They were the last ones to hold out on this.
TREASURER:
They're supporting lower taxes. That's what they're doing. Because they think it's the right thing to do. Now, they raise lots of things from time to time and we always look at those but they believe in lower taxes too.
DAVIS:
What did they raise this time?
TREASURER:
A lot of those things have been raised in public. There are apprenticeship schemes that they've talked to us about but we've made no announcements about those things or any decisions on those things but what we're saying…
DAVIS:
Will you?
TREASURER:
They've actually come to the Parliament and voted for them. A question is what was Bill Shorten offering them to vote against it?
DAVIS:
Well…
TREASURER:
I guess you could ask the same question.
DAVIS:
Well, it would be a very good question and it's something I will be putting to Bill Shorten tomorrow when he's here in town – Longman, he'll be campaigning and he has agreed to come on the program. So it's a question I'll be putting to him and it's why I'm putting it to you as well…
TREASURER:
Well, she's voted for lower taxes. That's what she's…
DAVIS:
But she wasn't originally going to.
TREASURER:
She had a number of views on this over time and at the end of the day, she decided to support lower taxes. Good for her.
DAVIS:
And there was nothing in return?
TREASURER:
We'll always work with the crossbench on issues they raise with us and when we make decisions on issues that are raised with us, we'll announce them.
DAVIS:
Treasurer, people earning over $200,000 a year, why should they get tax cuts? Couldn't this money be put into health, education, essential services?
TREASURER:
The people who are earning at that level currently account for 30 per cent of the tax take in Australia. At the end of this plan, they'll account for 36 per cent of the tax take. People who are earning at that level, they're four per cent of taxpayers and they currently pay 30 per cent of the tax in Australia and they work hard like everybody else. The percentage tax cut they will get is actually lower than someone on $50,000 a year. If you earn more money, you obviously pay a lot more tax, that's how it works. Over that seven years, if you're on that level of income, you will have paid $458,809 in tax. Now, we'll provide a 2.5 per cent cut on that under this plan. If you are earning $50,000 today, over that same period you'll pay $56,000 in tax and you will get a 6.3 per cent cut under the plan we have announced today. Obviously if people earn more they are paying a lot more tax. What Labor doesn't tell you is that the percentage reduction in their tax is actually lower than for those on lower incomes. That is why we started with people on lower incomes first, because that is where we think the most immediate need is. I don't buy into this whole thing that somehow we have to punish some people to help others. I don't think that's a very Australian idea at all.
DAVIS:
Treasurer it's a good message to sell coming into super Saturday and these by-elections. Does it make your job winning Longman here in Queensland, does it make it easier?
TREASURER:
We're just getting on with our plan for a stronger economy and that plan for a stronger economy, particularly up there in Longman, has a lot to do with the infrastructure that we're putting in around the Bruce Highway in particular. We've put about $1.5 billion into additional spending to support improved roads on the Bruce highway, there's the Gateway project, there's the Nambour Rail line also, which we're investing in up there. All of these are important infrastructure projects that are congestion busting. I know the roads up there, I'm a Sydney-sider and obviously a big Blues fan, but I do know that people living in that part of Queensland, sit in a parking lot in the morning. We're investing record levels to try and bust that congestion and support families who are just trying to get to work every day or if you're out there in your ute trying to get about to a site, making sure you're spending more time on site than you are sitting in your ute.
DAVIS:
This hurdle is now cleared with personal income tax cuts, what about the corporate tax cuts, where is your support on that? Where are the numbers?
TREASURER:
Well we'll know where that sits at the end of next week, but all I know, there are plenty of people out there who said we wouldn't be able to pass this plan, and we did. We'll apply the same determination and persistence for one simple reason and that's this, we know that if businesses face and have more competitive tax rates and don't have the highest tax rates in the OECD then they are going to do better. They're going to be able to employ more people. Large businesses provide a lot of work to small businesses and small businesses benefit by all businesses having lower taxes.
DAVIS:
Senator Hanson today said she is not budging on her position as far as this is concerned unless you go after the multinationals.
TREASURER:
Well, we'll be able to say to Pauline exactly what we have been doing on multinationals and what more we plan to do. In a couple of weeks' time I'll be releasing a further discussion paper on the whole area of digital taxation, new economy taxes which takes in a lot of those big multinationals. I'll be heading over to the next G20 meeting where that's one of the hot topics on the agenda. We've been leading the debate in that area. We're brought in $7 billion of sales revenue for big multinationals that is now in the tax net that wouldn't have been there without the Liberal Party. We have one of the toughest regimes in the world and we'll continue to make it even tougher and we're happy to listen to what ideas she has on that but on that issue we are at the front of the pack in the world.
DAVIS:
Treasurer I will let you go but one final question – Telstra. We know the job cuts are coming, we just heard, and I don't know how much you heard of my interview with Rupert Evans, from the Communications Sector Union. He said is there anyway of picking up the phone, talking to Telstra and saving some of these jobs.
TREASURER:
This was a very disappointing announcement yesterday and there's a lot of anxiety and stress for families that are affected by that. It happens over a number of years but this news would have been far worse, if our economy wasn't growing at 3.1 per cent. If there wasn't 3600 additional jobs for example that were created in telecommunications…
DAVIS:
Yeah but Treasurer 8000, 9000 they're talking about from the union. But either way this is the biggest corporate cuts in Australian history.
TREASURER:
It's around about 8000 over that period. What I'm saying is last year we had 415,000 jobs created. Now I know it's going to be tough and they've established a $50 million fund to support people transitioning into new jobs, but this is why we're so focused on creating a stronger economy because what this highlights is even big companies like Telstra have got to remain competitive and they'll make decisions, and they can have these impacts so you need a strong economy so when people are affected by this, they will be able to find jobs in other areas. So as I said 3600 jobs alone, in that sector just last year. But then you've got 162,000 jobs created in the services industry. You've got 47,000 created in the construction industry, 63,000 created in the manufacturing industry. So, we're seeking to have jobs created as a Government by having a stronger economy and that will always cushion the blow for people who are affected terribly by this. There's not much that can be done about that but we can do things to ensure that the economy is strong so they can find a new job at another place. Of that 415,000 jobs or thereabouts, one in about five of those jobs are in Queensland by the way, and one in five of those jobs are also for males aged over 55, often the people who are most affected by the changes you're talking about. So the economy we're presiding over, is providing opportunities but it also can't be taken for granted as these issues for Telstra have highlighted. That's why you've got to keep competitive tax rates for business. That's what helps ensure that these things don't happen more often.
DAVIS:
Scott Morrison, appreciate your time this afternoon.