2 July 2019
Transcript - #2019091, 2019

Interview with Tom Steinfort, The Today Show, Channel 9

Subjects: Coalition’s tax relief; Labor’s high tax agenda; interest rates.

TOM STEINFORT:

Treasurer, good morning to you. First sitting day of Parliament. It's almost like back to school. What are the priorities for the Government as we head in?

JOSH FRYDENBERG:

Good morning. Well, the first priority is to pass or tax cuts; the tax cuts that were central to the election campaign, tax cuts which will see up to $1,080 into the pockets of Australians who earn up to $126,000 a year. As well as long-term structural reform which will abolish a whole tax bracket completely and see 94 per cent of Australians pay a marginal rate of no more than 30 cents in the dollar. We were upfront with the Australian people, it was in our Budget, it was central to our campaign. Labor is now dragging their feet, showing they have learned nothing from their election defeat and they've heard nothing on their listening tour by continuing to oppose this important tax relief.   

TOM STEINFORT:

You are sort of tightening the screws here on Labor, effectively saying they've got to pass it because you've got the mandate now. I mean, flip the coin here though, if Labor had won the election, would the Coalition have just rolled over and supported their changes in Parliament on franking credits and negative gearing?

JOSH FRYDENBERG:

Well, they were disastrous policies and they were rejected by the Australian people and we saw the results…

TOM STEINFORT:

But if they'd been supported, would you have supported them?

JOSH FRYDENBERG:

If my mother was my father I'd be a different person. The reality is the Australian people spoke with a very loud voice. The Labor Party went to the last election claiming that they were seeking a mandate, seeking the moral authority to implement a very high taxing, high spending agenda. That is in their DNA. What we took to the Australian people was a reduction in tax, a very significant reduction in tax, that's what we're looking to pass the Parliament and Labor is a shambles. I mean, Tom, you've got their own backbenchers saying that they just need to get on with it and stop blocking tax cuts. And then you've got Jim Chalmers who was proud and pleased at the retirees and the housing taxes, saying, you know, that they're not going to support it. I mean, they really have a different position and a different excuse day to day.  

TOM STEINFORT:

So, if the legislation is passed this week, when do you think Australians might actually start seeing that money in their back pockets?

JOSH FRYDENBERG:

Well, I've spoken to the Commissioner of Taxation, he has told me that if it passes this week, the ATO will work through the weekend and with their systems changes and that people, when they put in their next tax return, will get that benefit as they are entitled. So that will be next week if it passes this week.

TOM STEINFORT:

Interests rates, that's the other big financial story today. Expected to hit a record low of one per cent when the RBA meets. I mean, interest rates generally they're only going to go down when the economy is struggling. It's not exactly a ringing endorsement of the Government's economic management that this step has to come in, is it Treasurer?

JOSH FRYDENBERG:

Well let's be very clear why the RBA has moved on interest rates. And that's because they've redefined what for them is full employment. Previously, they've seen full employment at around five per cent, today it's 5.2 per cent. Now they're saying it's got a four in front of it, so there is spare capacity in the labour market and they want to encourage more employment and they're not worried about subsequent inflationary concerns. That's why they've moved and in the words of the RBA Governor, they didn't move because of a deterioration in the economic outlook. So, the fundamentals of the Australian economy remain sound. Unemployment is lower than when we came to Government, we have a AAA credit rating, we have a relatively low debt to GDP ratio compared to other countries and we saw 40,000 new jobs being created last month. So, we continue to grow but we still face some challenges.    

TOM STEINFORT:

Are you anticipating an interest rate cut this morning?

JOSH FRYDENBERG:

Well, it's not for me to say one way or the other on that because it is the independent Reserve Bank that makes that decision. I see the markets have priced in, to some degree, a rate cut. But we'll only have to wait a few hours before we see the result of their deliberations.

TOM STEINFORT:

And just quickly, I mean, did the team get together? I said it's almost like going back to school for you today, heading back to Parliament. Was there a bit of a coach's chat almost from the PM making sure everyone is in line and ready to go?

JOSH FRYDENBERG:

Well look, the Cabinet met yesterday and the Party Room will meet today. Obviously I'm in regular contact with the Prime Minister and other colleagues and we know what we need to do and that's to implement the agenda we took to the Australian people which they endorsed. And it's all about them, it's not about us. We know that we are here to provide good government for them and that's what we will do. 

TOM STEINFORT:

Alright, Treasurer, Josh Frydenberg, appreciate your time on a big day there in Canberra. Thank you.

JOSH FRYDENBERG:

Thank you.