Labor MP Dr Mike Freelander has dismissed concerns the stage three tax cuts were only targeting the rich as he pushed the government to “stick to the plan”.
Treasurer Jim Chalmers prompted questions on Tuesday on whether Labor intended to amend the plan which would see Australians earning between $45,000 and $200,000 all moved onto the same tax bracket.
Dr Chalmers refused to rule out altering the existing plan and said the UK’s decision to dump its own massive tax cuts in the context of global economic uncertainty was a “cautionary tale”.
“We haven’t changed our position. We haven’t altered our position. Obviously any responsible government looks for ways to make the budget as sustainable and responsible as it can,” Dr Chalmers told reporters on Tuesday.
But the Treasurer’s language comes in stark contrast to his strong declaration only a week earlier that the tax cuts would have no bearing on current economic concerns.
Dr Freelander said the government needed to hold the line with proposal which it took to the election.
But the Labor MP for the seat of Macarthur, south west of Sydney, said the Treasurer was “weighing up all different opinions”.
“Jim Chalmers should certainly stick to the plan,” Dr Freelander said.
“We’ve made promises and I think that we need to stick to them.
“We’ve made some promises and people have planned on the promises we’ve made and I think we should stick with them.”
Under the tax plan – which is set to come into force in 2024 – the 37 per cent tax rate will be scrapped all together with those Australians earning between $45,000 and $200,000 moved to the new 30 per cent bracket.
The tax cut has been criticised as predominantly favouring wealthier Australians, but Dr Freelander refuted the claim and said cost of living pressures were affecting people across the country.
“People earning over $120,000 it does sound like a lot, but I know with the pressures with mortgages and the large mortgages … $120,000 or even a bit more than that, these are not rich people, these are people that are working hard to try and put a roof over their heads.
“I think we need to really look at it across the board and the pressures on people, I know there are people earning a lot less and I really think we need to be supporting them as well.
“But I don’t call these people rich.”
When asked if those at the higher end of the tax bracket could be labelled rich, Dr Freelander said: “I would call them well off, but not rich”.
The government is coming under pressure for potentially backflipping on the issue after senior members repeatedly ruled out axing the cuts before and after the election.
Only two days before the May election, Englishheadline Australia Chief Anchor Kieran Gilbert asked then-opposition leader Anthony Albanese if he could assure a Labor government would honour the cuts and not offset them by raising the Medicare or NDIS levies.
“Yes, I can,” Mr Albanese said on May 19.
Less than two weeks after coming to government, Mr Albanese doubled down on Labor’s pledge to push through with the tax cuts.
“We’re committed to delivering what we said we would,” the Prime Minister told Englishheadline Australia.
“I’ve said on the stage three tax cuts that they’ve been legislated, people are entitled to operate on the basis of that certainty.”
Opposition Leader Peter Dutton grilled Labor on potentially abandoning or altering the tax cuts and said there was a “huge divide” within the government on the issue.
“There’s an internal brawl going on within Labor going on at the moment about whether they adopt or drop the stage three tax cuts,” Mr Dutton said on Wednesday.
“Now the Treasurer is trying to find a slippery path out of the tax cuts, they’ve already been legislated, they’re due to come in in 2024.
“And the Treasurer is trying to draw an equivalence with what’s happened in the UK over the last few days, there is no comparison to be drawn.”
The Treasurer previously called the policy the “least affordable, least fair and least likely to be effective” but was moved to support it by Labor leader Anthony Albanese ahead of the election.