SON 2017: Putting fairness into tax system

“If we want to fund our investments in the future and repair the budget…I believe we need to address some of the structural problems in our tax system, beginning with an examination of unaffordable concession,” he said.

“There are…tax concessions which have mutated far beyond their original purpose.

“Delivering a fairer tax system is a short-term priority for lifting living standards, it’s also a medium-term challenge, making the structural changes for a stronger budget.

“There are two unsustainably generous tax concessions.

“We want to put fairness back in the mix which is why we’re taking action on negative gearing and the capital gains discount.

“If you aren’t prepared to make the tough calls to make a fairer tax system, then you simply end up raising taxes on the people who can’t afford to opt out.

“We will support the 0.5 per cent Medicare levy, for the top two brackets. Australians earning over $87,000.

“We don’t say that people who earn over $87,000 are wealthy, but what we do believe is when the bulk of the Australian people haven’t had a wage rise, when their energy bills are going up and then their kids are struggling to get a house deposit, we do not believe this is the right time to increase the income taxes of millions of Australians. It is effectively a cut in their income.”

Mr Shorten also discussed the cuts to penalty rates.

“The cut to penalty rates to workers in retail, hospitality, pharmacy and fast food, did not trade their Sunday rates for a better base rate of pay or better set of conditions,” he said.

“It doesn’t improve our competitiveness, our productivity or our economy.

“Instead what we have are stagnating living standards for working and middle class Australians.

“How do we maintain the great Australian safety net?

“We’ve been very fortunate in our mineral resources and the investment that’s gone into it, and…our terms of trade are very good. But that is the luck that the world gives us because they demand our commodities.

“Our challenge is what is the luck we make ourselves?

“To be an innovation nation, we need to be an education nation.

“It’s the investment in people…education and skills and training.”

State of the Nation: catch up here

Click here to see all the highlights from State of the Nation 2017