Cost of stage three tax cuts jumps by $11 billion to $254 billion   :(

Brisbane Times
October 20, 2022


More people in jobs, and wages growth have helped drive up the cost of stage three tax cuts by $11 billion, with the Liberal party warning the government is preparing to take away tax relief from millions of working Australians.

Treasurer Jim Chalmers said on Thursday the latest Treasury costing of the policy had grown from $243 billion to $254 billion by 2032-2033, a move likely to resurrect the political debate over the fairness of the income tax relief for workers on higher incomes.

Treasurer Jim Chalmers has revealed the cost of the stage three tax cuts has grown by $11 billion.   


“It’s been pretty clear to everyone, including all sides of this conversation over the last few weeks, that these tax cuts make an impact on the budget. But I think the point that we’ve been making is that they come in in a couple of years’ time,” Chalmers said on Radio National.

The stage three tax cuts, which come into effect on July 1, 2024, will eliminate the 37 per cent marginal tax rate for those earning over $120,000. They will also reduce the 32.5 per cent tax rate to 30 per cent for people earning between $45,000 and $200,000.

Sean Langcake, head of macroeconomic forecasting at BIS Oxford Economics, said the new forecast would be influenced by an upgrade in the outlook for how much would be collected in income tax.


“It could be a stronger assumption that they now have for the number of people that will be employed. It could also be a stronger assumption for wages growth. They’re the fundamentals for the amount of income tax receivable by the government,” he said.

“It’s clearly not a story of a change in the nature of the tax cuts or the way they operate. It’s just a function of the economy being in better shape than was previously anticipated.”

Jobs data published by the Australian Bureau of Statistics on Thursday showed the unemployment rate remained at 3.5 per cent in September, and the participation rate also remained steady at 66.6 per cent.



Shadow treasurer Angus Taylor said the comments from Chalmers were “frankly bizarre”, as the updated figures showed people were being affected by bracket creep.

“With inflation, this tax relief is needed more now than it has ever been. The easiest way to tackle bracket creep is to eliminate a bracket,” Taylor said.


Anthony Albanese is facing a tough test over middle- and high-income tax cuts he made an election promise to stand by.

“This isn’t a cost to the budget, it is legislated tax relief that this Labor government wants to take away from hard-working Australians.”

Chalmers said next week’s budget would not be about stage three tax cuts, but would focus on cost-of-living relief, targeted investment, and unwinding waste and rorts.

Prime Minister Anthony Albanese then rebuffed talk of an overhaul of the tax cuts for workers earning more than $45,000 a year.

Greens economics spokesman Nick McKim said the new cost estimate was further confirmation the cuts should be scrapped.

“$254 billion is a staggering amount of money that would be far better spent putting mental and dental health into Medicare, wiping student debt and making childcare free,” he said.

Chalmers will deliver his first budget on Tuesday and has been preparing the ground for a difficult set of figures due to international difficulties and what he said were booby traps set by the former Coalition government.

“Our predecessors more or less booby-trapped the budget with a bunch of spending, some billions of dollars in spending, which is unavoidable [and] which we’ve had to find room for,” Chalmers said on Thursday.

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This masthead reported on Thursday that preliminary work by the government’s audit of programs and promised savings had uncovered $6.4 billion in extra spending that would have to be shoehorned into the budget to ensure continued services such as aged care and COVID vaccine booster shots.

Opposition Leader Peter Dutton said the previous government made economic decisions that would have taken the budget back into surplus, had it not been for the pandemic.

Speaking on 2GB radio, he said it was the Coalition’s economic management that now meant the country would avoid recession.

In the long run
A reduced taxation collection
Should lead to a smaller government

This can only be a good thing

The movers shakers and wealth creators in the private sector
The small business people farmers and miners
Welcome smaller government

Three cheers for the tax cuts

Greens economics spokesman Nick McKim said the new cost estimate was further confirmation the cuts should be scrapped.

“$254 billion is a staggering amount of money that would be far better spent putting mental and dental health into Medicare, wiping student debt and making childcare free,” he said.   ;)

No white knight that is wrong

In every society there are the lifters and the leaners

It is important government unshackle the lifters
And as far as possible ignore the leaners

Dental care mental health care child care and most of the causes championed by the greens
Are leaning activities

Pumping money into those puts the country into a downward spiral

Giving money to the movers shakers and wealth creators
Is an injection of capital into awesomeness

If you want more awesomeness you'll have to support it
Why did the greens always want to support more losing and victims
Obviously the more money you pump into losers and victims the more losers and victims you are going to have

That's tragic on a personal and national level

Don't fund failure and you'll have less of it
Simple market economics

The greens are right. The stage tree tax cuts are a staggering amount of money.  One should ask the question.  What services will be cut in order to fund these huge tax cuts, that the high income earners don't need.   :(

Quote:

Greens economics spokesman Nick McKim said the new cost estimate was further confirmation the cuts should be scrapped. “$254 billion is a staggering amount of money that would be far better spent putting mental and dental health into Medicare, wiping student debt and making childcare free,” he said.

And, don't forget the housing crisis all around Australia.

What further proof do we need that there is no difference whatsoever between the LNP and ALP anymore?

ALP = Alternate Liberal Party.

aquascoot wrote on Oct 21^st, 2022 at 7:46am:

No white knight that is wrong In every society there are the lifters and the leaners It is important government unshackle the lifters And as far as possible ignore the leaners Dental care mental health care child care and most of the causes championed by the greens Are leaning activities Pumping money into those puts the country into a downward spiral Giving money to the movers shakers and wealth creators Is an injection of capital into awesomeness If you want more awesomeness you'll have to support it Why did the greens always want to support more losing and victims Obviously the more money you pump into losers and victims the more losers and victims you are going to have That's tragic on a personal and national level Don't fund failure and you'll have less of it Simple market economics

Do I really need to demonstrate this again?

---

Incorrect Karl and white night

Think of it like this

I have a paddock with some beautiful productive grass and some weeds

Applying money to our citizens is like applying fertiliser to our plants

Obviously I wish to apply as much fertiliser as possible to the productive grass
And I wish to apply as little fertiliser as possible to the weeds

This is what Mr Albany z is doing

Like a good farmer he is providing as much money as possible to the productive plants
And trying to reduce his weed burden


It's actually fairly stunning to me white night
That several properties in my area have been taken over by Greenies
And have a sign out the front saying vegetation rehabilitation
Zone

When you look at these paddocks run by Greenie pretend farmers
You see nothing but overgrown weeds as far as the eye can see

And then every four years a massive fire comes through and demolishers all the wildlife

Thank god Mr Albany z is listening to the Noble lifters and not the parasitic leaners

aquascoot wrote on Oct 21^st, 2022 at 7:01am:

In the long run A reduced taxation collection Should lead to a smaller government This can only be a good thing The movers shakers and wealth creators in the private sector The small business people farmers and miners Welcome smaller government Three cheers for the tax cuts

Smaller government, eh?

Start by going after the WEALTHFARE. The government should stop spending money on:
* Private health insurance rebate
* Private school subsidies that are greater than the amount given to public schools

The following tax concessions should also go:
* Franking credits
* Capital gains tax concessions
* Tax-free churches
* Tax concessions for trusts
* Tax-free borrowing against assets

Taxing greed is better!

Quote:

Shadow treasurer Angus Taylor said the comments from Chalmers were “frankly bizarre”, as the updated figures showed people were being affected by bracket creep. “With inflation, this tax relief is needed more now than it has ever been. The easiest way to tackle bracket creep is to eliminate a bracket,” Taylor said.

This is a lie. Removing a tax bracket does absolutely NOTHING to tackle bracket creep for people on incomes below this level. It's a smash and grab designed to give huge sums of money to higher income earners who feel the effects of bracket creep less due to receiving generous incomes.

Furthermore, it's also a lie to say it's the "easiest way". The easiest way to tackle bracket creep is to increase the tax free threshold. The last time the Liberals tackled bracket creep in this way was in 1982 - FORTY YEARS AGO. By not lifting the tax free threshold, the Liberals are making bracket creep WORSE for those who can least afford it.

However, the easiest way to tackle bracket creep is not the best way. The best way to tackle bracket creep is to introduce automatic indexation of the income tax brackets, tied to the CPI.

I hope they scrap the cuts but I suspect they won't

Bam wrote on Oct 21^st, 2022 at 11:34am:

aquascoot wrote on Oct 21st, 2022 at 7:01am: In the long run A reduced taxation collection Should lead to a smaller government This can only be a good thing The movers shakers and wealth creators in the private sector The small business people farmers and miners Welcome smaller government Three cheers for the tax cuts Smaller government, eh? Start by going after the WEALTHFARE. The government should stop spending money on: * Private health insurance rebate * Private school subsidies that are greater than the amount given to public schools The following tax concessions should also go: * Franking credits * Capital gains tax concessions * Tax-free churches * Tax concessions for trusts * Tax-free borrowing against assets Taxing greed is better!

You've effectively taxed freaking investment in Australia (by Australians) you clueless nong!

And your ridiculous measures will only make our economy even MORE vulnerable to external stake holders and stock holders.

Lisa Jones wrote on Oct 23^rd, 2022 at 8:40am:

Bam wrote on Oct 21st, 2022 at 11:34am: aquascoot wrote on Oct 21st, 2022 at 7:01am: In the long run A reduced taxation collection Should lead to a smaller government This can only be a good thing The movers shakers and wealth creators in the private sector The small business people farmers and miners Welcome smaller government Three cheers for the tax cuts Smaller government, eh? Start by going after the WEALTHFARE. The government should stop spending money on: * Private health insurance rebate * Private school subsidies that are greater than the amount given to public schools The following tax concessions should also go: * Franking credits * Capital gains tax concessions * Tax-free churches * Tax concessions for trusts * Tax-free borrowing against assets Taxing greed is better! You've effectively taxed freaking investment in Australia (by Australians) you clueless nong!

Because investment income is too lightly taxed, you insatiably greedy capitalist pig.

Why should income from employment be taxed much more heavily than income from investment? Why shouldn't they attract a similar level of taxation?

Lisa Jones wrote on Oct 23^rd, 2022 at 8:40am:

And your ridiculous measures will only make our economy even MORE vulnerable to external stake holders and stock holders.

Your naive insistence on keeping the status quo only drives wealth inequity. Already the housing market has reached unsustainable levels around the world due to insatiable greed from the rich. Inflation has returned to levels not seen for decades. The rich set these prices.

The current growth of wealth inequity is unsustainable. If this is not addressed, we'll see the collapse of the global economy as most people lack sufficient income. Slums will return to our cities; it's already happening in the USA.

It has gotten so bad - something you don't even realise - that taxing the rich more has become absolutely necessary and essential at this point to preserve our economy and way of life.

Bam wrote on Oct 23^rd, 2022 at 11:40am:

Lisa Jones wrote on Oct 23rd, 2022 at 8:40am: Bam wrote on Oct 21st, 2022 at 11:34am: aquascoot wrote on Oct 21st, 2022 at 7:01am: In the long run A reduced taxation collection Should lead to a smaller government This can only be a good thing The movers shakers and wealth creators in the private sector The small business people farmers and miners Welcome smaller government Three cheers for the tax cuts Smaller government, eh? Start by going after the WEALTHFARE. The government should stop spending money on: * Private health insurance rebate * Private school subsidies that are greater than the amount given to public schools The following tax concessions should also go: * Franking credits * Capital gains tax concessions * Tax-free churches * Tax concessions for trusts * Tax-free borrowing against assets Taxing greed is better! You've effectively taxed freaking investment in Australia (by Australians) you clueless nong! Because investment income is too lightly taxed, you insatiably greedy capitalist pig. Why should income from employment be taxed much more heavily than income from investment? Why shouldn't they attract a similar level of taxation?

How does investment tax differ from income tax ?

Bam wrote on Oct 23^rd, 2022 at 12:04pm:

Lisa Jones wrote on Oct 23rd, 2022 at 8:40am: And your ridiculous measures will only make our economy even MORE vulnerable to external stake holders and stock holders. Your naive insistence on keeping the status quo only drives wealth inequity. Already the housing market has reached unsustainable levels around the world due to insatiable greed from the rich. Inflation has returned to levels not seen for decades. The rich set these prices. The current growth of wealth inequity is unsustainable. If this is not addressed, we'll see the collapse of the global economy as most people lack sufficient income. Slums will return to our cities; it's already happening in the USA. It has gotten so bad - something you don't even realise - that taxing the rich more has become absolutely necessary and essential at this point to preserve our economy and way of life.

bam bam bam

the rich dont have a job where they pay tax like joe lunchbox.

i suppose if you increase the tax rates at the top you might hit the odd neurourgeon or  orthodontist.
but most rich folk dont collect a pay cheque every fortnight

they have passive income streams that you cant touch , income that can be moved offshore at the stroke of a pen.

you silly sausage

You can buy a lot of homeless housing pods for $11Bn ..... just saying...

Anyway - really this is adjustment for 'bracket creep'.... so why not simply put bracket creep into the calculations?

Waal.. ya see, if tha gov'un'ment put 'bracket creep' inta tha calculations, Pilgrim, they'd have nothin' ta argue over an' make a song an' dance about ta keep tha people occupied while they romp all tha way ta Rome...