Prime Minister Anthony Albanese has affirmed that his stage 3 tax cuts won’t stoke inflation, ahead of a fierce round of negotiations over Labor’s contentious changes.
Spruiking his new tax policy ahead of parliament’s return next week, Mr Albanese stood firm behind his decision to slash tax cuts for high-income earners to redistribute them to lower and middle-income workers, despite previously vowing not to touch the policy.
He said that his overhaul to the tax cuts won’t force the RBA to delay raising interest rates and said new figures showing a drop in inflation meant things were moving “in the right direction.”
“It is welcome and encouraging progress in the challenge of dealing with inflation, but that work continues because we know that people are still under pressure and we need to not be complacent about it,” Mr Albanese said on Wednesday.
“We need to continue to work as we have with our three point plan having the surplus, making sure we deal with cost of living pressures without putting pressure on inflation and dealing with supply chain issues as well.”
In response to weeks of heavy fire from critics, including from Liberal Leader Peter Dutton who last week said that Mr Albanese had “completely and utterly destroyed his credibility with the Australian public” after changing his mind on the cuts, Mr Albanese challenged his rival to suggest an alternative plan.
Mr Dutton has so far refused to commit to a position on the tax cuts, but told reporters on Tuesday that he would reveal the Coalition’s stance in due course.
“The truth is that there has been no criticism of any substance of our package by either the Coalition who’ve engaged in personal abuse,” the Prime Minister said.
If the Coalition opposes Labor’s tax cuts overhaul, the government will need to win over the Greens as well as two Senate crossbenchers to drive its bill through parliament.
Mr Albanese refused to answer if he would consider an increase to Jobseeker or other welfare payments in exchange for the Greens’ support for the changes.
This came after Greens leader Adam Bandt revealed this week that he would potentially back Labor’s package in exchange for concessions including a lift to welfare payments, as well as adding dental to Medicare.
“It gets you to talk about them and that’s fair enough – that’s politics,” Mr Albanese said.
“Our proposal stands on its merits and at the end of the day the minor parties as well as the Coalition have to decide if our package is better than the package that was previously there.”
The prime minister also indicated he would focus on taking his new tax bill to parliament instead of supporting a push for wide-ranging tax changes, as put forward by independent MPs including Allegra Spender.
“I have a lot of time for Allegra Spender. But of changes that we’ve put forward, she’s yet to support the PRRT changes that we’ve advanced and the changes to superannuation,” Mr Albanese said.
“What we’re focused on is what we will take to the parliament in the coming weeks.”
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