House of Representatives

Second Reading Speech

Mr Sukkar (Assistant Treasurer, Minister for Housing and Minister for Homelessness, Social and Community Housing)

I move:

That this bill be now read a second time.

This bill amends the Excise Tariff Act 1921 to halve the excise rate which applies to domestically produced petrol and diesel. This means the excise rates for petrol and diesel will fall from 44.2 cents per litre to 22.1 cents per litre.

The Russian invasion of Ukraine has seen fuel prices increase, adding to the cost-of-living pressures already faced by families and the cost of doing business more broadly. As part of Australia's plan for a stronger future, the government is taking decisive, responsible and temporary action to reduce the pressure of high fuel prices on household budgets across Australia.

The temporary 50 per cent reduction in excise will apply to all fuel products, other than aviation fuels, for six months from 30 March 2022 to 28 September 2022. Existing indexation arrangements will still apply to the reduced rates in August 2022. At the conclusion of the six months, the excise rates will revert to the previous rates, including indexation that would have occurred on the full rates during the six months.

The Australian Competition and Consumer Commission will continue to monitor the prices, costs and profits relating to the supply of petroleum products in the petroleum industry in Australia, to help ensure benefits are passed on to the intended recipients, the Australian people. This standing direction from the Treasurer is currently in place until December 2022.

This bill is complemented by measures in the Customs Tariff Amendment (Cost of Living Support) Bill 2022 and the Treasury Laws Amendment (Lowering Household Costs and Other Measures) Bill 2022.

Full details of the measure are contained in the explanatory memorandum.

Debate adjourned.

Leave granted for second reading debate to resume at a later hour this day.

Mr COLEMAN (Banks-Assistant Minister to the Prime Minister for Mental Health and Suicide Prevention) (13:14): Firstly, I would like to thank those members who have contributed to this debate. With the Treasury Laws Amendment (Cost of Living Support and Other Measures) Bill 2022 and the related bills, the Morrison government is delivering on its continued commitment to addressing cost-of-living pressures faced by Australians in a responsible, temporary and targeted manner. This will ensure the low-income thresholds keep pace with increases in the cost of living.

The amendments to the Medicare levy low-income thresholds apply to the 2021-22 income year and future income years. This increases the maximum low- and middle-income tax offset benefit to $1,500 for a single-income household and $3,000 for a dual-income household. This benefit will be provided on the assessment of taxpayers' tax returns for the 2021-22 income year. It is estimated that over 10 million taxpayers will benefit from the one-off cost-of-living tax offset in 2021-22. The cost-of-living tax offset will put more money in taxpayers' pockets, helping them to meet rising cost-of-living pressures. Recipients of social security and veterans' payments and holders of certain concession cards will be eligible if they are residing in Australia on the test date of 29 March 2022. Each member of a couple will receive the payment if both are eligible.

The government is taking decisive, responsible and temporary action to cut fuel excise and reduce the pressure of higher fuel prices on household budgets and small businesses, while maintaining continued road funding for the states and territories. These changes apply to fuel products other than aviation fuels for six months from 30 March 2022 to 28 September 2022. When the measure ends, the excise rates will then automatically revert to the previous rates, plus indexation that would have occurred on those rates during the six-month period. The benefit available for gazetted oils under the Product Stewardship for Oil Scheme will continue to directly offset the duty rate on these oils.

I commend these bills to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.