Bill Shorten will offer workers a $1500 wage gain from a tax plan designed to help employers expand, as he intensifies his pitch to voters on the economy in the final fortnight of the election campaign.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
The Opposition Leader will outline an economic plan that could also create thousands of jobs from a $3.4 billion policy to give companies stronger incentives to expand and hire new staff.
As the election race tightens, Mr Shorten will also pledge $500 million to fix waiting times at hospital emergency departments while accusing Prime Minister Scott Morrison of starving the health sector of federal funds.
Global companies such as Facebook will also face a crackdown by tax authorities in a Labor policy to curb the use of licensing agreements to shift profits offshore.
The economic message will be at the heart of Mr Shorten's speech to the Labor campaign launch in Brisbane on Sunday, expected to be attended by former prime ministers Paul Keating, Kevin Rudd and Julia Gillard.
Mr Shorten will declare that Australian doctors and nurses "deserve the best resources in the world" and must receive more commonwealth funding.
"This is what people pay their taxes to Canberra for. I don't want to give it to multinationals in bigger loopholes, I want to build better hospitals and cut waiting times," he says in a draft of his remarks.
"This is what our hard decisions have been about, delivering better services to every Australian."
Mr Morrison will redouble his promise on tax relief today by issuing his agenda for Parliament if he retains power at the May 18 election, starting with laws to cut personal income taxes by $15 8billion over a decade. "It is your money and you should get to keep more of what you earn," he said in a statement.
While Mr Morrison has insisted he offers better economic management than Mr Shorten, the Labor campaign launch will draw on a new report that estimates the party's tax incentives for business could create up to 77,000 jobs.
The report by the McKell Foundation examines an existing Labor policy, the Australian Investment Guarantee, which would allow businesses to claim an immediate tax deduction for 20 per cent of the value of any new eligible asset worth more than $20,000.
Mr Shorten and the Labor treasury spokesman, Chris Bowen, will ramp up their attack on the Coalition's economic credentials by claiming a better economic gain than the sweeping company tax cuts put forward by Mr Morrison until they were dumped last year.
Labor and the Coalition both support a lower company tax rate for businesses with turnover of up to $50 million a year, but Labor offers the Australian Investment Guarantee as well.
"The ALP's Australian Investment Guarantee provides greater incentives for new private sector investment than the Coalition's policy," the McKell Institute says.
Using a forecasting method from the Tax Foundation in the US, the report estimates the Labor policy would increase employment by 50,000 to 77,000 over time. This could take place within a few years of the start of the policy. The report also relies on US studies on the impact of tax incentives on wages, calculating this could add 2.4 per cent to Australian wages.
"Annualised average weekly earnings for all employees in Australia are around $63,700," the report says. "A 2.4 per cent increase in average weekly earnings for all employees in Australia equates to $1529 per annum."
Mr Shorten will use his speech to explain the benefits to essential services from Labor decisions to increase tax revenue.
This is intended to defuse criticism of policies to raise $56 billion over a decade by tightening the rules on franking credits from shares, $30 billion from tightening rules on concessions and about $32 billion from changes to negative gearing on property investments. The Australian Investment Guarantee is estimated to sacrifice $3.4 billion in tax revenue over four years and about $10 billion over a decade as a result of its incentives.
The McKell Institute describes itself as a ''progressive'' think tank and is close to Labor.
"The McKell modelling is the latest endorsement that our investment guarantee will effectively boost investment and jobs," Mr Bowen said. "Importantly, this modelling demonstrates that the investment guarantee will drive rapid job creating investment."
SMH/The Age
