Opposition Yet to Show Hand on Tax Cut Support, But Calls for ‘Lower Taxes’ for Australians

If the opposition decides against backing Labor’s tax plan, the move will be another key policy difference between the 2 major parties.

Leader of the Opposition Peter Dutton speaks to media in Melbourne, Australia on Dec. 12, 2023. AAP Image/Joel Carrett

Opposition Leader Peter Dutton has indicated the Liberal-National Coalition will back lower taxes for Australians amid Labor’s changes to the country’s tax structure.

The Albanese government is planning to introduce legislation into parliament next week providing tax cuts for low and middle-income earners. However, the Labor proposal reneges on an election promise to abolish the 37 percent tax rate for those earning between $120,000 and $180,000 a year.

The Coalition is yet to see the proposed details and will meet as a team early next week to formalise a position.

While the Coalition is yet to show its hand, Mr. Dutton said on the Today Show that “the Liberal Party has always been the party of lower taxes, and that’s going to continue.”

The federal government 2024 tax plan involves lowering the 19 percent tax rate to 16 percent for incomes between $18,200 and $45,000.

In addition, it reduces the 32.5 percent tax rate to 30 percent for incomes between $45,000 and $135,000 and lifts the 37 percent tax rate threshold to $135,000.

A 45 percent tax rate threshold would be increased from $180,000 to $190,000 under the plan.

When asked if the Coalition would “take away money” from the electorate, Mr. Dutton said, “We are not going to, I’ve been very clear about that.”

“We’ll announce our position in due course, but we think there’s a massive black hole in what the government’s doing at the moment.

“We don’t understand how they can be arguing that they’ll take an extra $28 billion over the next few years. It’s not 1.8 million taxpayers who are worse off, it’s actually 4 million taxpayers over the course of the next decade, just with people’s inflation and with wage increases that you get each year at work, people quickly move through the tax brackets, and it’s really hitting them between the eyes.”

Albanese Touts Tax Cuts

Prime Minister Anthony Albanese, speaking to reporters on Feb. 2, said, “We have a plan that we will put to the Parliament of every Australian taxpayer getting a tax cut.”

“We’ve targeted this fairly and squarely at middle Australia, but as well, we’ve made sure that everyone gets a tax cut so that those people earning under $45,000 a year are not left behind,” Mr. Albanese said.

Treasurer Jim Chalmers said Labor’s “cost of living tax cut” for middle Australia is “all about supporting the hard work of people who make our economy and our country strong.”

“This is all about supporting people who work hard so that they can provide for their loved ones and get ahead. This is good for workers and families and communities right around Australia, and it’s also good for the economy,” Mr. Chalmers said.

“It’s not just about [the electorates of] Forde, or Farrer, or Dickson, or Dunkley; this is about supporting the workers and their families and communities right around Australia by making sure on the 1st of July every taxpayer gets a tax cut, but 84 percent of Australian taxpayers will get a bigger tax cut because of what the prime minister announced last week.”

In response, Shadow Treasurer Angus Taylor said the Coalition has not seen the legislation yet, but that it would “support lower, simpler, fairer taxes.”

“It’s very clear that Australians’ standard of living has collapsed under this government. 18 months and they’re far poorer than they were 18 months ago.

“We‘ll go through our processes. Labor clearly spent a long time working on this broken promise. And we’ll make sure we get our response absolutely right, but the principles are very clear.”