News National Government tax cuts deal to pass Parliament with Jacqui Lambie, Centre Alliance support

Government tax cuts deal to pass Parliament with Jacqui Lambie, Centre Alliance support

jacqui lambie tax cuts
Tasmanian senator Jacqui Lambie isn't convinced about the motivations behind the proposal. Photo: Getty
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The biggest tax cuts in Australian history are on track to become law within 24 hours, with the government securing the votes of Centre Alliance and Tasmania’s Jacqui Lambie.

The crossbench senators confirmed Thursday morning the “good faith” handshake deal will involve passing the tax cuts without amendment.

“Yes, I will be supporting the tax cuts,” Lambie told ABC Radio National.

The deal means Australia will have a top tax rate of 30 cents in the dollar for 94 per cent of workers from 2024.

Labor is yet to make a formal decision on Stage 3 of the tax cuts but is under mounting pressure to wave the tax cuts through. The support of the crossbench senators including Australian conservatives Cory Bernardi means their position is now redundant. 

The government was asked to wipe a $157 million Tasmanian debt to the Commonwealth for social housing in return for the support of Senator Lambie.

The New Daily understands the Morrison government will not forgive the entire debt because of the precedent it will set for others states, but is happy to provide an alternative that delivers a similar result and tackles homelessness and affordable housing in the state.

“We are always happy to engage with senators in relation to issues of concern to them and their constituents,” Finance Minister Mathias Cormann said.

“We call on Labor and all other non-government senators to act in the national interest by supporting our income tax reforms in full.”

Just weeks ago, Senator Cormann claimed he would not trade with the crossbench to secure the tax cuts.

That principle appeared short lived, with the government also crunching a deal with Centre Alliance to put downward pressure on gas prices.

Centre Alliance Senators Rex Patrick and Stirling Griff, Senator Lambie and Australian Conservatives’ Cory Bernardi are expected to deliver the votes the government requires.

Senator Lambie outlined her terms for backing the full tax package on Wednesday, demanding the federal government tackle homelessness in Tasmania.

“I was elected by the people of Australia. I work for them and it is to them that I answer,” she said.

She said it was time for the government to act on Tasmanian debt and to help those who would not benefit from tax cuts.

“People in Tassie are doing it tough and for them $1000 in their back pocket now will give them some immediate relief,” Senator Lambie said.

“But there are thousands of Tasmanians who are on the pension, Newstart and don’t earn enough money to pay tax – and they don’t see any benefit from a tax cut.

“Tasmanian families are sleeping in cars, parks and tents – all in the dead of winter. Three thousand Tasmanians are on the housing waiting list.”

She said Tasmania owed the federal government $157 million in social housing debt.

“Tasmania is paying 50 cents in every dollar of our state housing budget back to the federal government in interest and debt repayments. That means we are building half as many homes, helping half as many people. This at a time when the Tasmanian treasurer is spruiking Tasmania’s ‘golden age’,” she said.

“The state Liberal government keeps talking a big game but they haven’t achieved anything in debt relief. At this rate we’ll be paying this debt for another 23 years.

“This time last year Tasmanian families were living in tents in the [Hobart] Showgrounds. It’s a year later and the situation has only got worse. They need help now, not in 2042.”

Senator Lambie said only wielding the balance of power in the Senate would bring real debt relief for Tasmania.

“That’s what I am here to fight for,” she said.

“There is no way in good conscience I can vote for substantial tax cuts without making sure that the people who so desperately need a roof over their heads aren’t left to go without.”

Senator Lambie has not yet clinched a deal but is trusting the Coalition to deliver on her demand.

“I still need some more time so that we can iron it out properly,” she said.

Stage 3 of the government’s proposed tax cuts would reduce the 32.5 per cent tax rate to 30 cents. In combination with a previously legislated plan to abolish the 37 cent rate, it would deliver a top tax rate of 30 per cent for 94 per cent of workers.

The full tax plan passed the House of Representatives on Tuesday, with Labor voting for it but reserving the right to amend it in the Senate.

The Senate will consider it on Thursday – with the government promising that senators will sit until the package is passed.

Earlier on Wednesday, Senator Lambie repeated her call, first issued to The New Daily, for a clause in the legislation to ensure the future tax cuts would not be paid in 2024 if they are not affordable.

“They are five or six years away. We don’t know where the economy is going,” she said.

“I’m watching it play out. You know what politics is like … [it] changes more than you change your undies.”

Just weeks ago, Senator Lambie delivered a warning to the Morrison government that it had not always treated her with respect.

“You know what, Scott Morrison? If I am lucky and I hold that balance of power, I hope to God you and your people treat me a hell of a lot better than what they did in the three-and-a-half years I was up here,” she said.

“Otherwise, mate, if I’m part of that balance of power, we’re going to have a lot of difficulty getting things through unless it’s going to cost you a lot of money – which is great for Tasmania because I’ll be able to deliver. You know what? Drop the attitude.”

-with agencies

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