Australia news live: Chalmers says Coalition have ‘no more excuses’ to delay tax cuts decision as legislation revealed | Australia news

Josh Butler

Sticking with analysis on stage-three from the Grattan Institute:

Coates and Moloney predicted “the biggest loser from the revised tax plan may end up being the federal budget” – pointing to the commonwealth’s reduced spending power.

These tax cuts will make it harder for this government, and future governments, to meet community demands for more spending in areas such as healthcare, aged care, disability care, and defence.

The commitment of both major parties to big income tax cuts now, means there will be less money in future to ‘buy’ more worthwhile reforms.

The Greens leader, Adam Bandt, claimed yesterday that Labor’s changes hadn’t done enough to fix the “unfairness” in the original stage-three plan.

If Labor’s spending $300bn, why do they need to give tax cuts to politicians and billionaires when low- and middle-income earners are still doing it tough?

Bandt flagged plans to “fight for more” for low-income earners. He last week indicated the party may put a rise to the tax-free threshold, a rise in the jobseeker welfare payment, or adding dental into the Medicare system, on the negotiating table – even as Albanese claimed the government wasn’t keen to horse-trade.

The government requires the support of the Coalition or the Greens to pass the tax cuts changes through the Senate.

Josh Butler

There are calls to urgently increase jobseeker payments and rent assistance for those missing out under the federal government’s overhaul announced in late January.

Analysis from the Grattan Institute found that about a third of households – such as the unemployed, those with a disability and retirees – don’t pay tax and therefore miss out on the benefits.

“What’s missing from the government’s package is relief for those genuinely struggling the most, and who don’t benefit from these tax cuts,” said Brendan Coates, Grattan’s economic policy program director, and Joey Moloney in the paper.

Many of these Australians are among those doing it toughest.

The government should “urgently” expand cost of living relief to those households, the authors said, suggesting further boosts to commonwealth rent assistance of $1,000 a year and a $55 weekly rise to jobseeker.

Those combined increases would cost around $4.7bn a year, Grattan said, less than a quarter of the $20bn yearly cost of the tax cuts.

Josh Butler

Labor’s stage-three cut changes leave behind vulnerable, analysis warns

Labor’s changes to the stage-three tax cuts still leave behind vulnerable people including the unemployed, people with a disability and retirees, new Grattan Institute analysis warns.

The federal treasurer, Jim Chalmers, says his amended tax cuts will better address bracket creep for middle-income earners compared with the Morrison-era plan currently legislated.

But the “biggest loser” under Labor’s stage-three cuts could be budget and crucial services like health and defence, the Grattan Institute forecasts, with the $20bn annual price tag making it harder for the government to meet community demand.

According to Chalmers’ figures, the average worker on $73,000 a year would pay a 21% average tax rate under the current Coalition-legislated plan in 2024-25, but 19.9% under Labor’s plan. Out to 2027-28, that worker would pay 22.4% under current settings, but 21.5% under Labor’s plan.

The Grattan Institute’s analysis said bracket creep would gradually erode the value of the tax changes, noting Labor’s plan to keep the 37% tax bracket – which would be abolished under the current plan – would see average tax rates rise faster for those earning between $135,000 and $190,000.

Grattan’s figures suggested “the vast bulk of Australian taxpayers benefit” from the changes, especially middle-income earners, with average income earners to pay $8,040 less tax over the next decade. However, those earning above $150,000 – an income higher than 90% of taxpayers – would pay about $23,000 more over the decade.

Grattan estimated 83% of taxpayers would pay the same or less tax over the next decade under Labor’s changes, compared with the Coalition stage-three plan.

Good morning

Emily Wind

And happy Monday – welcome back to a new week on the Australia news live blog. I’m Emily Wind and I’ll bring you our rolling coverage today.

Parliament will return for the year tomorrow, and the revised stage-three tax cuts will surely be the main focus. Treasurer Jim Chalmers told ABC News Breakfast this morning the Coalition has “no more excuses” to delay the changes.

He was asked whether the government was willing to negotiate on the changes with the Coalition or Greens to get the changes through the Senate, and said:

No more excuses, no more stumbling around and stuffing around. It’s time for the Coalition, in particular, but also the other crossbench members, to come to a position. The detail is out there. The legislation is out there. There are no more excuses.

Meanwhile the latest Newspoll was released overnight, and as AAP reports, voters support the government’s decision to change the stage-three tax cuts, but Labor’s lead over the Coalition remains unchanged.

Meanwhile, the Albanese government unveiled its long-awaited plan for fuel-efficiency standards at the weekend, due to be introduced to parliament in the first half of this year and take effect from January 2025.

You can read all the details from Henry Belot bellow:

We’ll bring you more on these stories – and more – shortly. If you see something that needs attention on the blog, you can get in touch via X, @emilywindwrites, or send me an email: [email protected].

Let’s get into it.