24 August 2015
Transcript - #2015177, 2015

Doorstop interview, Sydney

JOURNALIST:

Treasurer, how can you afford tax cuts when you already have other spending cut measures that aren’t getting through?

TREASURER:

Well, as we illustrated in our last Budget where we delivered $5 billion of tax cuts for small business, if you’re careful with money, if you make very careful decisions about other tax initiatives, then you can get the balance right and deliver tax cuts – particularly for those on lower and middle incomes.

JOURNALIST:

Are cuts in themselves enough – income tax cuts enough – what else do you need to do?

TREASURER:

Well, we’ve got to look at the entire taxation system. We’ve received over 850 submissions to our taxation discussion paper. We’re working with the states on the details of a potential package that involves reform at both a federal and state level, so that we can have a tax system ready for the 21st Century.

JOURNALIST:

Have you thought about thresholds at all? Like you were saying $77,000 it goes up to [inaudible] - have you thoughts about where these thresholds could start kicking in?

TREASURER:

Yes we have. Clearly, to have about just over two times average earnings kicking you into the top tax rate is at the odd end of the line in international comparisons. So what we want to do is get the balance right and unquestionably bracket creep is holding people back from getting ahead in Australia. If it’s doing so now, it’s going to do on a much larger scale, harm to the Australian economy into the future.

JOURNALIST:

So will there be cuts to personal income tax in the next Budget? If not then, when?

TREASURER:

Well you will see our proposal – we’ve always said we will have discussions with the states, we will have a discussion paper with the community and will take any major taxation reform proposals to the Australian people at the next election.

JOURNALIST:

How likely is the GST to be on the table? Is that one of the things you’re considering?

TREASURER:

We are actively considering a range of different taxes and it is about putting in place a taxation system that is delivering more jobs and greater opportunity for everyday Australians. Look, tax reform cannot be solely about raising revenue, which is the wish of the states. From our perspective, tax reform has to build a stronger economy with greater prosperity and more jobs.

JOURNALIST:

Very quickly on the market – are you concerned about recent falls and how do you think our market is reacting?

TREASURER:

Look, next week I’ll be travelling to Turkey for the G20 where I’ll meet Finance Ministers and Central Bank Governors from around the world. It will be a very important meeting because we’ll get a better indication of the pending decision of the US Federal Reserve to increase interest rates in the United States. Obviously there are concerns that there will be quite a bit of capital flow dislocation as a result of that decision. So the more transparency we can get from the US Federal Reserve and Janet Yellen in particular, the more it will help to address some of the volatility in the global stock markets.

JOURNALIST:

Treasurer, [inaudible]

TREASURER:

Very good question about start-ups, you’ll hear more about it in the not too distant future. Thanks very much.