The Coalition has hit back at Labor claims that families would pay higher income tax and lose payments worth thousands of dollars a year under an Abbott government, saying the ''reality is the opposite'' and that it would also fund tax cuts.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
On Monday, Prime Minister Julia Gillard and Treasurer Wayne Swan revealed government analysis that suggests western Sydney families would be up to $2300 worse off a year, assuming the opposition cut the Schoolkids Bonus, abolished carbon tax assistance and lowered the tax-free threshold.
Shadow treasurer Joe Hockey dismissed the analysis based on Australian Bureau of Statistics data. In a statement, Mr Hockey argued that families would be better off under the Coalition, because it would end ''Labor's waste'' and scrap the carbon tax.
''The Coalition will also fund a tax cut without the carbon tax because we understand that many Australians are doing it tough,'' he said.
Mr Hockey also said that the government had ''done nothing like'' triple the tax-free threshold, which Labor lifted from $6000 to $18,200. ''The effective tax-free threshold for 2011-12 was $16,000 due to the impact of the low income tax offset [LITO],'' he said. ''When you combine changes to the LITO with the other changes being made as part of the compensation package for the carbon tax, much of the benefit is clawed back.''
Opposition Leader Tony Abbott said that the Coalition would not necessarily remove tax breaks. ''No, don't assume that. We'll fund them out of savings to unnecessary and wasteful government spending. We won't fund them through a carbon tax,'' he told Channel Nine.
Mr Abbott said the Coalition would provide funded tax cuts and pension increases, but repeated his commitment to cut the Schoolkids Bonus, which he calls a ''cash splash''.
Labor MP Andrew Leigh, who was an economics professor before he was elected to the seat of Fraser, said he could not see how Mr Abbott could make the numbers ''add up'' on the carbon price.
''Once he's given that massive big tax cut to polluters, he's going to have to take the cost of that back from pensioners. Otherwise the economics just aren't there,'' he said.
Dr Leigh said the Consumer Price Index, which was the best available measure of the cost of living, had been lower under Labor than during the Howard government.
