AUSTRALIAN lawmakers yesterday narrowly approved tax hikes for the wealthy that will help the government meet its pledge to deliver a budget surplus next year.

The legislation will limit the availability of a 30 percent tax rebate on health insurance premiums to lower and middle-income earners. Currently all taxpayers can claim the rebate.

But from July 1, individuals earning more than 129,000 Australian dollars (US$137,800) a year and couples with joint incomes exceeding 258,000 Australian dollars will no longer be eligible. They are expected to pay, respectively, around 500 and 1,000 Australian dollars extra a year on average. The cap will cost high earners a total of 2.4 billion Australian dollars over three years.

The bill scraped through the House of Representatives yesterday by 71 votes to 70. It is assured passage through the Senate this year with the guaranteed support of the Labor Party government senators and those from the Greens party.

Tony Abbott, leader of the Liberal Party, accused the government of playing the “politics of the class war” by increasing the tax burden on the wealthy. He warned that wealthy people would give up their private health insurance and add pressure on the public health system. (SD-Agencies)