20th Jun 2018, 6:48 PM – Senate Treasury Laws Amendment (Personal Income Tax Plan) Bill 2018 - in Committee - Senator Storer's amendments

The majority voted against amendments (3) to (8), (10) and (12) to (15) on sheet 8441, which was introduced by Senator Tim Storer (Independent). This means they failed.

Senator Storer explained that:

Given our substantial debt challenge—$341 billion net debt in 2017-18, and growing—it is irresponsible to proceed with the full income tax plan proposed by the government at this point in time. The measures commencing in 2022 and 2024 lock in over $120 billion in reductions in revenue out to 2028-29. By Treasury's own admission, uncertainties generally tend to increase as the forecast horizon lengthens; therefore, there are larger error bands around estimates three, four or more years ahead. The geopolitical and economic uncertainties noted by Treasury in budget estimates in May demand the government prepare by focusing on debt and deficit reduction as well as maintaining essential services. We are in a substantially weaker budgetary position now than we were in 2007 in the lead-up to the GFC. There's no need to rush these changes that commence in 2022 and 2024. They are well beyond the scope of the forward estimates and the next election. There will be ample time between now and then for parliament to re-examine the appropriateness of these measures and decide whether to proceed with the additional elements of the government's plan.

History tells us that tax cuts, once legislated, are very difficult to wind back; therefore, we cannot rely on an assumption that these cuts could be repealed or amended if unforeseen economic developments materialised. In the context of a recent uplift in government revenue, the measures set to commence from 1 July 2018 are affordable. Given rising cost-of-living pressures and wage stagnation, the new low- and middle-income tax offset is particularly warranted and should be locked in to provide lasting targeted support to low- and middle-income earners beyond the forward estimates. With that extension, information received from the Parliamentary Budget Office indicates that the amended plan I am putting forward would cost $46.75 billion compared with the $143.95 billion for steps 1, 2 and 3 of the government's plan as it stands, and $102.35 billion for steps 1 and 2. The amended proposal I am putting forward of $46.75 billion generates savings that would help us return to surplus sooner, pay down debt quicker and free up money to spend on critical social and infrastructure programs, and I hope that it meets with the approval of the chamber.