Federal Budget: Treasurer Jim Chalmers defends McDonald’s Happy Meal tax cuts, no means testing, bill relief

Treasurer Jim Chalmers has defended his $5 tax cuts, which have been described as enough for a coffee or a “McDonald’s Happy Meal”.

When asked if he thought the $5 was enough, Dr Chalmers said: “Well, it’s more than that”.

“There are two rounds of additional tax cuts and together with the tax cuts which are flowing now, the average is about $50 a week, $10 additional in last night’s Budget,” Dr Chalmers said on Sunrise.

“We need to be responsible.”

However, Sunrise host Natalie Barr questioned how responsible The Budget was, pointing out Australians earning $1 million a year still get the Treasurer’s tax cuts.

“When you cut the bottom rate of taxes, it flows through up and down the system, but proportionately it applies to people who need it the most,” Dr Chalmers said.

“The biggest proportionate impact is people on relatively modest incomes, young people, people entering the workforce for the first time, and that’s deliberate.”

Pressing the treasurer further, Barr asked why the Government didn’t cut it off at a threshold, allowing that money to be used elsewhere.

“Because the only simple and effective way to do that would be to provide it in people’s tax returns,” Dr Chalmers said.

“That’s the only way you can limit it up the tax scale.

“We wanted to make sure this was a permanent ongoing benefit.

“What we’re doing is topping up the tax cuts which are already flowing to every Australian taxpayer to provide that cost-of-living relief.”

Treasurer Jim Chalmers on Budget energy bill relief

Dr Chalmers says the Government is doing what it can to take “the sting” out of electricity bills as relief is provided without a fix being applied to the cause.

“What we showed last year is that by providing these energy rebates, we can take some of the sting out of the energy bills, which are impacting people right around the world,” Dr Chalmers said on Sunrise.

“We do what we responsibly can.

“We have to make sure that the cost-of-living relief is affordable.

“That’s why we’re providing another six months of these energy rebates rather than 12.

“That’s why we’ve sequenced the tax cuts that we have, because The Budget is a responsible Budget, it’s all about helping people with the cost of living and strengthening Medicare and building Australia’s future.

“It’s delivered in the context of a remarkable improvement in The Budget in the economy over the last three years.”

Jim Chalmers says ‘we have an issue’ when it comes to cigarette tax

The Treasurer has responded to a $17 billion hole in The Budget, as cigarette taxes collapse amid a growing illegal tobacco trade.

“What we’ve done with vapes is make it harder for kids to get their hands on them,” Dr Chalmers told Sunrise.

“We’re worried about kids using vapes as a gateway to cigarettes.

“There’s been a hit to tobacco excise.

“Two reasons, more people giving up, more people avoiding the excise, that’s a bad thing.

“New resources are in The Budget for compliance and enforcement.

“We have an issue when it comes to the enforcement of the tax. We’re taking steps where we can to try to fix that.”