Fed: Tax keeping workers from jobs - Labor

AAP General News (Australia)
04-01-2005
Fed: Tax keeping workers from jobs - Labor

MELBOURNE, April 1 AAP - Marginal tax rates were forcing some Australians out of the
workforce and discouraging others from higher career aspirations, Shadow federal treasurer
Wayne Swan said today.

Mr Swan, speaking at the Sustaining Prosperity Conference at the University of Melbourne,
said the OECD latest Taxing Wages Report showed marginal tax rates for Australian families
were, in most instances, among the highest in the OECD.

"High marginal tax rates are insidious and they have for years been taking a toll on
the aspirations of hard-working Australians," he said.

"They are likely to discourage workers from seeking promotion, continuing their education
or working overtime because of the poor marginal returns involved.

"We are the world champions at putting in place disincentives for people that want
to work hard to get ahead."

The federal government had made the problem worse for some families following the 2004
Budget, Mr Swan said.

"They spend two years of each three-year cycle squirrelling money, the last year simply
shovelling out large sums of cash in untargeted ways to win an election and all the time
making the incentives of the system worse."

Tax reform would be at the forefront of Labor's attack on the government this year, Mr Swan said.

"I don't underestimate just how difficult and daunting tax reform is either for my
party or for the country," he said.

"But we have now reached the point where it must be done to secure our future prosperity
and that will be the objective of the Labor Party in the months ahead."

AAP jrd/bd/dk/lb,

KEYWORD: TAX

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