The federal government has got it wrong on tax changes, Cathy McGowan says.
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The Indi MP, fellow independent Andrew Wilkie and Greens MP Adam Bandt were the only ones to vote against the government’s personal income tax plan when it was debated in parliament this week.
“The government’s proposed tax changes need to be fair and balanced. I don’t believe they have got it right,” Ms McGowan said.
She said she supported stage 1 of the plan, which included a low and middle income tax offset in the form of a $200 benefit for taxpayers earning $37,000 or less per year. Those earning up to $90,000 would be eligible for a benefit of up to $530.
But the controversial stage 3 of the plan involved changes to tax brackets which would result in someone earning $41,000 per year paying the same tax rate as someone on $200,000.
“Stage three is the most unfair,” Ms McGowan said.
“While I support tax cuts for low and middle income earners, if it is a trade-off between cuts for high income earners and provision of more services then the choice is clear.
“The tax system needs to be fair and progressive.”
She said her survey of Indi residents since the budget showed they were concerned about the tax system.
Mr Wilkie went a step further on Twitter, calling it a “a dishonest & self-serving con job” to give MPs a $7225 per year tax cut.
Labor voted with the government to allow tax cuts for low and middle income earners to pass the House of Representatives, but senators will lobby for changes to stage 3 before the plan passes.