Australian Liberals' Family Tax Break Scheme Slammed

by Mary Swire, Tax-News.com, Hong Kong

30 October 2001

The argy-bargy over taxation between the two main Australian political parties is continuing unabated in the run-up to the general election, and at the weekend, opposition leader Kim Beazley slammed John Howard's proposed family tax break as 'regressive', saying that it would benefit those who need it least.

Under the Liberal government's new plan, women having their first baby will be able to claim back up to $2,500 a year of tax paid in the year before their baby was born. The Prime Minister has stood by the proposals, claiming that they are a 'socially positive initiative'. The Women's Electoral Lobby, however, has stated that it is unhappy with the planned legislation, and that the government should consider improving maternity leave arrangements instead.

Labor, unsurprisingly, has also been scathing about the new plans, arguing that they will only benefit around 10% of the Australian population, including some of the country's most well-off citizens. 'What we have here is a proposition for a small number of Australian families and even for them there's less to this package than meets the eye,' Mr Beazley explained at the weekend.

'John Howard's proposal only applies to one child. It doesn't apply to families who have children now unless they have an additional child. It only applies to its full extent if women in the families stay out of the workforce for five years,' he continued.

The Labor leader promised that if his party is successful in the forthcoming general election, the planned GST rollback will provide tax relief for all Australian families, not the select few affected by John Howard's planned measures.

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