Transcript: ABC Shepparton Breakfast - 20/2/23

20 February 2024


SUBJECTS: Cost of Living; Taxation; Regional and Rural Victoria

NIC HEALEY: Now, changing tack just a little bit. The Stage 3 tax cuts, they were, I think arguably, the most controversial of that tax reform run. And as they were initially proposed, they were set to see people with larger salaries getting more money in the pay packet. I remember one example was an executive earning around 200, 000 a year would have been about 12, 000 better off. 

Now you might recall you and I were chatting about some of the number crunching that showed that more of those benefits were going to go to metro areas. There just weren't enough people earning that sort of money in regional areas to see the money flow our way. In fact, the electorate of Nicholls, where I am right now, was actually listed in the bottom 10 of places around the country who would see the benefit from that Stage 3 tax cut. 

Now the recent changes to those cuts have genuinely changed that equation. Jana Stewart is the Federal Labor Senator for Victoria. Jana, good morning to you.  

SENATOR JANA STEWART: Good morning, and good morning to all of your listeners.  

HEALEY: Now, you've noted quite recently that in the Goulburn Valley specifically, 85 percent of taxpayers, or about 56, 000 Victorians, are going to get a bigger tax cut under these new look Stage 3 tax cuts.  

Where's that modelling coming from? Where are those numbers coming from?  

STEWART: So that modelling is coming out of Treasury and I just really want to go back to the points that you've made earlier. The Goulburn Valley is set to be one of the electorates to benefit the most out of the changes to the Stage 3 tax cut with 85 percent of taxpayers receiving a bigger tax cut compared to Morrison's plan. 56, 000 people in the Goulburn Valley who are better off.  

And I think that is an incredible thing for the Goulburn Valley. And in real terms, that means a schoolteacher at your local secondary college will be better off. A nurse who works at Shep Hospital will be better off. Your V/line driver is better off under these plans. This is a plan for low and middle Australia, who are arguably feeling the cost of living pinch the most. This is absolutely sensible, responsible and That means that, money will be in the pockets of Australians who are feeling the pinch the most. 

HEALEY: But that money does have to come from somewhere. One of the original criticisms of the Stage 3 plan was that it was going to be a 20 billion hit to the budget. That hasn't changed with the remodelling. Is that fiscally responsible? Should that money be better used by the government?  

STEWART: Our advice from Treasury is that it is fiscally responsible. 

The changes that we've made don't add to inflationary pressures. I think that's really important. We don't need Australians to have a further increase to cost of living right now when they're doing it really tough. So the change we've made absolutely within the bounds and don't add to that inflationary pressure. 

I think the other really important thing is that when Australians are just tough. We aren't trying to save money as a government out of that. We're trying to make sure that the money is going to where it's needed most. So people are keeping more of what they earn when the prices of things are going up. 

They can put food on the table and keep a roof over their head. We think that's really important.  

HEALEY: Important enough to, the government's copped quite a hit over essentially changing their promises around this.  

STEWART: We think that this is the sensible and responsible thing to do. Under Morrison's plan, your local barista who might serve you your coffee every morning was going to get a big fat zero. 

Absolutely those people who are serving us our coffee in the mornings or on lower incomes are feeling the cost of living. The other really important thing to know is that these changes, Morrison's changes, were legislated five years ago. You know what we've had in the last five years, and this is, this will be no surprise to people of the Gourlburn Valley. 

We've had a once in a 100-year pandemic. We've had natural disasters and severe weather events. We've had an increase to inflation. We've had wars and conflicts internationally that have added to some supply challenges into Australia, which has increased the cost of goods. 

These are all things that need to be factored in. We aren't living in a world that was five years ago. We are living in today. And what we know is that one of the things that Australians say is the number one priority for them. Is cost of living and the advice that we've got from Treasury is the best way to ease cost of living is with these tax changes because we want people to keep more of what they earn. 

People work hard and are doing it tough. And so these are absolutely the responsible and simple thing to do. 

HEALEY: Jana Stewart, really appreciate your time this morning and thank you. Jana is the Federal Labor Senator.