Budget 2014: Win-Lose for Abbott Government as Deficit Levy Gets Senate OK, But Coalition Senator Slams Measure

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By Vittorio Hernandez | June 18, 2014 9:01 AM EST

A provision in the proposed Coalition budget that broke then Opposition leader Tony Abbott's promise not to impose a new tax was approved in the Australian Senate on Tuesday.

REUTERS/Ruben Sprich
Australia's Prime Minister Tony Abbott speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos January 23, 2014.

The deficit tax, which imposes a 2 per cent levy on residents who earn more than $180,000,  was approved on voice votes only, not by individual voting in which dissent from some lawmakers, one of whom is even a Coalition senator, was not recorded, The Sydney Morning Herald reports.

The one who has stood against the tax is Senator Ian Macdonald who said the levy must be imposed on companies, not individuals. He asked fellow Coalition member, Finance Minister Mathias Cormann to explain why companies are not being levied the tax, instead of residents.

He said, quoted by News.com.au, "If there is a debt crisis, and I accept there is, that requires people to contribute whether it's in a reduction in government assistance or additional tax for high income earners, then why is it that companies ... why is it that those companies aren't being asked to contribute."

Macdonald pointed out that every dollar that could be raised from companies is a dollar less from individual taxpayers.

Other parts of the first and controversial Coalition budget include the $7 GP fee and the paid parental leave scheme that Prime Minister Tony Abbott is pushing for.

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(Photo: REUTERS/Ruben Sprich / )
Australia's Prime Minister Tony Abbott speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos January 23, 2014.
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