Pauline Hanson has revealed the Morrison government hasn’t even approached her about negotiating the $158 billion tax cut package, raising fresh questions about the Prime Minister’s timeline for July 1 tax cuts.
Ten million Australian workers could face delays on the promised $1080 tax return bonus unless the brinkmanship in the Senate can be resolved. That’s because the PM Scott Morrison argues the reforms are “a package” that cannot be split.
But Finance Minister Mathias Cormann is continuing talks with the Centre Alliance about a gas export mechanism, despite claims he won’t do deals with the cross bench.
The One Nation leader – who has a history of talking tough before rolling over – said on Monday she would not back Mr Morrison’s tax cuts, raising the option of more infrastructure spending instead.
“I haven’t been approached by Mathias Cormann – there has been no negotiations that have gone on,” she told the Today show.
“I haven’t spoken to the Prime Minister and my office had a meeting with the Treasury last Friday to discuss the tax cuts.
“The feedback that I have got is that they can do it one of two ways – we can either go with the tax cuts or we can go with infrastructure projects, which will do exactly the same. At the end of the day, we are going to end up with infrastructure that will deliver up cheaper electricity, security and also the water security that we need as well for the country.”
— Pauline Hanson 🇦🇺 (@PaulineHansonOz) June 17, 2019
Senator Hanson’s vote remains vital unless Labor agrees to back the entire package, a prospect that currently seems unlikely.
While the Coalition has improved its position in the Senate, it still needs about three votes to pass the legislation, assuming it has 36 votes when Australian Conservative Cory Bernardi votes with the Liberals.
Those three votes can either include the two Centre Alliance senators and Jacqui Lambie or the One Nation Senators with Centre Alliance or Senator Lambie.
Last week, Centre Alliance’s Senator Rex Patrick told The New Daily he wanted the Morrison government to consider gas export limits to ensure the tax cuts did not get swallowed up by rising energy prices.
The first round of the government’s tax cuts – $1080 for taxpayers earning up to $126,000 – is due from July 1 but needs to pass the parliament for it to come into effect. Parliament does not resume until July 2.
The other two phases are scheduled for 2022 and 2024.
These new measures include increasing the top threshold of the 19 per cent tax bracket from $41,000 to $45,000 and increasing the low-income tax offset from $645 to $700.
The New Daily revealed on June 4 that Labor’s shadow cabinet had discussed backing the second stage of the government’s tax cuts to lock in the benefits for low- and middle-income earners.
But it will block an “offensive” flat tax rate of 30 cents in the dollar for the majority of workers.
The tax cut in 2024 is designed to slash the 32.5 cent tax rate to 30 cents for 94 per cent of taxpayers, including workers earning six figures.
It has not yet been considered by the ALP caucus. But shadow finance spokesman Jim Chalmers has written to the Treasurer.
“To assist Labor and the cross bench, I request the total cost to the budget in each year of each of the components of the 2018 and 2019 packages, and the total cost to the budget of any tax relief for those in the highest income tax bracket of over $180,000,” Dr Chalmers wrote.
“As you know, Labor stands ready to urgently pass the first tranche of tax cuts to address the weakness in the economy on your watch.”
The Australia Institute claims the bulk of the tax cuts for higher income earners will also go to men because they earn more than women.