Government, Opposition face off over Medicare levy increase

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The Coalition and Labor are staring each other down over the Federal Government’s $8 billion increase to the Medicare levy.

Key points: Government, Opposition at heads over Medicare levy increase to fund NDIS

Key crossbench senators remain sceptical about the Government’s plan to increase the Medicare levy from 2019 in order to fund the National Disability Insurance Scheme (NDIS).

That means the Government may need Labor’s backing to pass it through Parliament — but the Opposition has declared it will only support an increase for people in the top two income tax brackets.

Federal Treasurer Scott Morrison was asked this morning whether he would be willing to compromise on the increase to get it through Parliament, and made it clear the Government would not engage in horse-trading.

“No, it’s a fair measure … we’ve already come to the middle on this,” Mr Morrison said.

“We didn’t want to put an increase on the levy, we wanted to be able to do it through savings. And the Senate in their decision decided to reject that.

But Opposition Leader Bill Shorten said Labor would not budge on its stance.

“We’ve made clear our position and we hope the Government sees sense,” he said.

Labor continues to insist that the Coalition should instead abandon its planned corporate tax cuts, and extend a temporary deficit levy on high-income earners, which is due to expire this year.

“This is a Government who is making sure millionaires pay less from July and that 10 million ordinary Australians pay higher income tax,” Mr Shorten said.

How much extra tax you’ll pay

How much extra tax will I pay per year?

What you earn $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000
What you’ll pay $125 $250 $375 $500 $625 $750 $875

Full coverage of the 2017 federal budget



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