Independent MP Allegra Spender has addressed the National Press Club, speaking about her views on the Albanese government’s changes to the Stage 3 tax cuts and her push for broader tax reform.
Spender, the member for the wealthiest electorate in Australia – Wentworth in Sydney’s eastern suburbs – said her community was split on their support for the recent changes to tax cuts. She noted that the majority of people in Wentworth would benefit from the changes and there was broad support, however there were some people who were going to lose out.
“If you look at the stats, 66 per cent of Wentworth will benefit from these changes,” Spender said. “I know everyone has a view on Wentworth but it is much more diverse than most of the country would expect. In broad terms, most people are saying this is a good thing.”
She went on to say that “we are also the electorate with the biggest proportion of people who are going to lose out.” Of these people, she says, some have told her that they were counting on the original tax cut, while others have told her they are happy to see people on lower incomes getting more support.
Before coming to a set position, Spender said she thought it was fair to consult widely with the community.
“I’d say there is this sense of the split,” she said. “And I do think based on the results we’ve had so far, there is a majority of support out there for this change.”
“There’s actually a really significant group of people who would have benefited, who are also saying, you know what, we want to help other people. This is a really hard time right now.”
However, Spender did point out that many people on higher incomes had contacted her saying they had been counting on receiving the larger tax cut.
“They believed that the changes were going to happen. They put it into their budgets. They were planning to spend it on their mortgages and renting and you know, they do feel completely let down,” she said.
“They all recognise they’re not the only people having a hard time in Australia. And many, many people are doing it tougher.”
“Renting a unit in Bondi costs $900 a week, so you have to earn more than 150 grand to avoid rental stress. This is why my community is saying ‘look, we want real tax reform, not only temporary relief’.”
The Stage 3 tax cuts, which were originally legislated by the Morrison government in 2019, have been changed by the Albanese government to offer broader cost of living support to those of low and middle incomes. They are due to come into effect in July.
Broader tax reform
Spender, who appeared at the National Press Club alongside Richard Denniss, Executive Director of the Australia Institute, also discussed the need for broader tax reform in Australia. She said she will put a number of ideas forward to the community and the parliament for discussion, rather than finalised policy. She will be releasing a green paper on the topic mid-year.
Some of the options Spender spoke about included reducing taxes on labour income, looking at changes to super tax concessions, stamp duty and land taxes, the GST, company tax thresholds, payroll taxes and fuel taxes.
Spender said she was concerned about Australia’s over-reliance on income tax and her green paper would be focused on four objectives: intergenerational equity and housing affordability, productivity, real action on climate change and building an institutional framework for further tax reform.
“I’m going to present these options to the community. These options will not be finalised policy. No doubt they won’t be perfect,” she said.
“And I’m sure I’m going to be having robust conversations with my community with a broad range of stakeholders and with parliament once they’re released. They will naturally evolve as I try to build consensus. And I look forward to the scare campaigns that no doubt my opponents will dream up.”
Spender said she would like to see both major parties come to the table and discuss the possibilities on tax.
“This is the challenge that I put to the major parties. I challenge major parties to deny that we have long term problems. They know that this is true and they feel it and we feel it in the community,” she said.
“I challenge them to pretend that tax isn’t one of the issues isn’t one of the solutions to the major problems this country faces and I challenge them to be part of the solution. Rather than wedging each other from the side.
“The challenge for the major parties now is to find the courage to work towards building a better Australia. That’s what I’m going to do. That’s what my community expects and that’s what the rest of the parliament needs to do.”