By political reporters Karen Barlow and Louise Yaxley
Thursday 14 August 2014
Video: Hockey says poorest people 'don't drive very far'
Photo: Joe Hockey (AAP: Andrew Sheargold)
Related Story: Hockey accused of arrogance for saying poor people 'don't have cars'
Treasurer Joe Hockey says he does not care about personal criticism that he is out of touch with the Australian community, declaring he is just presenting facts about poor people's use of cars.
Coalition backbenchers and the Opposition have taken Mr Hockey to task after he claimed poorer Australians would not be hit by increases to the fuel tax because "the poorest people either don't have cars or actually don't drive very far in many cases".
Mr Hockey wants to end the 13-year freeze on the indexation of the fuel excise, saying it would raise more than $2 billion over four years which would be spent on roads.
This morning he stood by his comments.
"The Australian Bureau of Statistics data states that the highest 20 per cent of household incomes pay three times more in fuel taxes than the lowest 20 per cent of household incomes, " he told ABC NewsRadio from Perth.
"The Australian Bureau of Statistics data is not something that I've concocted, it is the reality. These are dealing with the facts."
However, the Parliamentary Library found in 2001 that raising the fuel excise would be regressive, because low-income earners pay a higher proportion of their income on the tax than higher earners using the same amount of fuel.
The Treasurer is not disputing the analysis.
"Well, that is the case with any indirect tax. Obviously with the GST... when we introduced the GST there were substantial tax cuts," he said.
Shorten a 'complete hypocrite': Hockey
Yesterday, Opposition Leader Bill Shorten seized on Mr Hockey's comments as evidence the Government is out of touch and "remarkably arrogant", describing the Treasurer as the "Foghorn Leghorn of Australian politics".
Today Mr Hockey said Mr Shorten was a "complete hypocrite".
"The Labor Party is always going to run this personality politics. Good luck to them. Others will join in," he said.
"I don't care about that commentary, I care about dealing with the facts and ensuring that we have a strong economy."
Former Howard government minister Peter Reith says the ABS statistics show Mr Hockey is "completely right".
"Treasurers cop a lot of flak however they are going, but in some of the points he has been making he been right to make them," he said.
"Let's face it, the Labor Party are absolutely opposed to absolutely everything that he does whether it is good bad or otherwise, whatever you might think of it."
Nationals senator says low-paid people in bush rely on cars
Nationals senator John Williams has contradicted the Treasurer's argument on the fuel excise, saying people in the bush pay more.
"The lowest paid people in our nation are in rural and regional areas in many respects, and they do have to have a car," he said.
Queensland LNP senator Ian Macdonald also criticised the plan to increase the fuel tax.
"Regional Australians don't have the alternative of public transport or other means of getting there," he said.
"You have to have a car whether you are rich or poor. You need a vehicle to be able to get from one place to the other. To get to hospital, to get to school, to get to your daily work routine.
"And unfortunately increases in fuel excises will impact more heavily on those who don't have an alternative."
No easy way to sell budget fix, Nationals MP says
Nationals backbencher John Cobb says while the excise is not popular, it is part of the Government's budget strategy.
"This increase is not a big one and nobody wants it. I don't want it, but nobody wants a set of books that are cooked either, so they do have to be fixed," Mr Cobb said.
He said he did not know if there is an easy way to sell the excise increase to the public.
"Look I really don't know if there is a good way of getting across an increase on what people pay by way of a fuel levy," he said.
"It does mean some amount more for everybody. The less you drive the less you will pay.
"However, I guess we are in a position of having to fix the budget. Labor ruined it and the responsibility and some unpopularity for what you do is a burden we have to bear because we were elected to do it."
Labor's treasury spokesman, Chris Bowen, says Mr Hockey's defence about the overall household spending figure does not tell the whole story.
"What he is ignoring is the fact that it is a higher proportion of the income of low income people.," he said.
"That is the definition of a regressive tax, which Joe Hockey doesn't seem to understand."
Labor's Anthony Albanese says Mr Hockey's budget made people more reliant on their cars.
"This is a guy who in his first budget, cut all funding for any public transport project in Australia that wasn't already under construction, thereby taking away that option from people," he said.
The Government could not get the change through Parliament after the budget - so missed its deadline of increasing petrol tax this month, when other excises rose with inflation.
Mr Hockey argues Labor and the Greens should back down on their refusal to support his move.
He is negotiating with the crossbenchers on fuel excise and the other remaining aspects of his budget.
The Treasurer's office released the following data:
