Anthony Albanese says Australians can still trust him after his shake up to the stage 3 tax cuts as the Opposition ramps up its attack on the Prime Minister’s credibility.
The Prime Minister defended the change – which redistributes planned tax cuts to higher income earners to fund bigger cuts to those earning under $150,000 – as a necessary response to cost of living pressures, even though he had previously vowed not to change the planned cuts.
“We know that particularly low and middle income earners are under real financial pressure. And so when you have that evidence before you, you have to listen to people,” he told Queensland radio 4RO.
“Australians can trust me to be prepared to make difficult decisions, not the easy decisions.”
As recently as two weeks ago, Mr Albanese said he was “committed” to the stage 3 tax cuts as legislated by the then-Morrison government in 2019.
The Prime Minister justified his backflip due to the changes in “economic circumstances”, arguing the decision was only made at cabinet last Tuesday.
But the Opposition is sceptical and have claimed the broken promise was made due concerns about Labor’s chances in the upcoming Dunkley by-election in Melbourne – which it holds by 6.3 per cent.
“I think it’s obvious when you look at the design of the stage three tax cut broken promise, what he’s replaced it with, it’s squarely designed to try and shore up their numbers in Dunkley,” Peter Dutton told reporters in Perth.
Education Minister Jason Clare, who was on the ground with Labor’s candidate Jodie Belyea in Dunkley on Tuesday, said 87 per cent of taxpayers in the seat would benefit from the tax cut.
Under the reworked stage 3, the lowest tax bracket would be reduced from 19 per cent to 16 per cent for earnings under $45,000 and the 37 per cent tax rate for those earning between $135,000 and $190,000 would be retained.
The 45 per cent tax bracket will now kick in for those earning over $190,000, down from the planned $200,000.
Shadow cabinet will meet in Perth on Tuesday to discuss how the Coalition will respond to the reworked tax plan. But Mr Dutton held his cards close to the chest when asked where he expected his frontbench to land on the issue.
“We will have an announcement in due course,” he said.
It’s expected the Opposition will move amendments when Labor puts the changes to parliament. Should they fail, the Coalition can either vote against it on principle or wave it through in order to neutralise the government’s wedge.
Mr Albanese accused his opponents of being “all over the shop” when it comes to the cost of living.
“The Coalition talks a lot about cost of living pressures, but they vote against all of (our policies). They voted against cheaper medicines. They voted against cheaper child care. They voted against our energy price relief plan,” he said.
Earlier, Mr Dutton sought to tie the broken promise directly to Mr Albanese’s credibility. He questioned whether voters could trust Mr Albanese’s word that he would not to revisit shelved policies on negative gearing and franking questions.
In a speech to the Chamber of Minerals and Energy, the Opposition Leader said the stage 3 rewrite would “asphyxiate aspiration, crush confidence and obliterate opportunity”.
“I think Australians will also be asking, what’s the next broken promise?” Mr Dutton said.
Treasurer Jim Chalmers shot down speculation of any further changes on Monday but when asked in an interview a day later, Mr Albanese changed the subject to talk about “free TAFE”.