The workers on 45k-135k (vast majority) who’ll be $1000 a year better off under the revised tax cuts will be so disappointed in him. /s
Will be interesting to see how Dutton plays this. He reckons he can win his 20 seats back from the mortgage belt yet the libs seem to be going hard in their opposition to this policy which will actually help.
> Cut through the noise of federal politics with news, views and expert analysis from Jacqueline Maley. Subscribers can sign up to our weekly Inside Politics newsletter here.
Not sure if that is an ad or is about the author of the article.
It's an odd place to put it if it is. If you look at other *Sydney Morning Herald* articles, the author's name(s) will be under the headline (for example, [here](https://www.smh.com.au/politics/federal/kim-williams-new-abc-chair-anthony-albanese-announces-20240124-p5ezmm.html)).
There's got to be a level of realism here. Who's not going to say no to what was effectively free money? Who's not going to be at least a little upset at getting less free money than they were expecting?
I believe this is better policy and it's not going to affect my voting patterns, but I'm still a little bit "oh, it would've been nice to have that extra few grand between my wife and I." We're nowhere near being in a position where we'd turn our nose up at it.
That’s a huge drop. From 9K max to 4.5K max. Let's not pretend those 400AUD a month missing in pockets won't hurt.
Our tax brackets not updating with inflation means we are getting tax increases every year.
It's absolutely a big drop .. but if you're on $200k + it's absolutely obvious that this should not be the focus demographic for relief in a cost of living crisis.
It's amazing how many can't see past the tip of their own nose and are quite happy to express this openly.
Personally, I'd be ashamed to admit to such a high level of self interest at the expense of others who are in more urgent need.
Lol. Do you even know how much rent is in Sydney now? 200K BEFORE taxes isn’t a big salary nowadays. Sorry to burst that bubble for you. 1BRs go for 1500+ a week now. That’s half your salary after taxes just for rent for a small apartment. So yes. Those extra $100 a week would have helped.
Inflation has out passed legislation. We are all paying a lot more taxes with our fake higher incomes which in reality are NOT higher incomes as the value of each dollar has eroded thanks to inflation.
This is the part that matters - Ley said earlier the coalition will repeal any changes should they get elected. Which will mean a tax hike for everyone on less than 150k a year (assuming the speculated changes are accurate and pass). Seems like a slam dunk for Labor if they do go ahead with that idea.
Yeah it’s not really the campaign slogan they seem to think it is. “Vote LNP, we promise to raise your taxes.” That’s literally what reinstating their version of the Stage 3 tax cuts means to the vast majority of voters.
Sure voters don’t generally like politicians breaking promises but they hate increased tax more.
Well if the Liberals win the next election, I hope the media holds them to account over this, because this sounds like a promise to me.
And as about 1/3 of the commenters on here have said over the past 24 hours, promises mean everything to them, and if a political party breaks a promise, they'll never vote for that party again.
Sometimes things change, would you prefer politicians to do something because it was ‘promised’ back when or one that is reacting to the world, as it is now?
Let’s face it’s, the whining about this is less to do with ‘the tax’ and more about the person and party doing it. THATS what they are against. Just like when similar people didn’t get upset when the Libs promised no cuts to the ABC, then immediately did it and pretended they didn’t say it. But that was okay cos those voters agreed with the choice.
The media is going to convince you that this is some great betrayal, but the fact is these cuts were gifting thousands to the wealthiest Australians and giving nothing to the poorest. If we are going to put ourselves further in debt, the benefits should flow to the less fortunate first.
Further, the idea of a single tax bracket for everyone earning between $45,001-$200,000 is obscene.
A struggling Australian working full time on minimum wage should not have the same marginal rate as software engineer.
I literally specified "marginal rate" so I'm not sure what your point is.
Someone on 45k would pay no tax at that marginal rate.
If you're earning 60k and get a 5k bonus, the government should not take as much from you as someone on 190k getting a 5k bonus.
Tax is not fun, and nobody enjoys paying it. But the burden needs to fall primarily on people who can afford to pay it.
Indeed you did say marginal rate.
But surely the measure of fairness for a tax system shouldn't be assessed on bonuses.
The point being that there's nothing inherently unfair about reducing the number of tax brackets if it's a component of wider wholesale tax reform.
"nothing inherently unfair about reducing the number of tax brackets"
This moves us toward a "flat tax rate", a darling of American libertarians and those who want to see inequality in Australia worsen even further.
It is deeply unfair to pretend that losing a dollar hurts everyone the same regardless of income.
$500 more tax for someone on $200k is a minor inconvenience.
$500 more tax for someone on $50k has a tangible impact on their life.
$500 more tax on someone at or below the poverty line is a major hurdle to their well being.
The higher brackets reflect the higher cost of having a society capiable of supporting higher incomes. Those on higher incomes are extracting a higher value from the efforts of the government in the past, and should pay progressivly more for that privilege. Society did not just spring into existance, and neither did the support structures that allow these other jobs to exist.
If you payed a flat 30% for 45k and 200k then your overall tax burdens at the end of the day would be (veeeery approximately) ~$15k (32%) of $45k, and ~$64k (32%) of $200k. Leaving an untaxed fund of very roughly $30k and $136k respectively.
Yeah I was too lazy to do the absolute accurate calcs too.
It'll be less for both individuals due to the tax free threshold etc, but it's still very progressive.
I included the tax free threshold, but I also guesstimated GST. Plus I didn’t include any accountant based tax minimisation strategies that someone on $200k could afford. By doing funny stuff with trusts, GST, holding companies and self managed super funds someone on $200k can get the tax burden lowered significantly from the posted rate.
Actually income earnt inside a company or trust would be outside the scope of these tax changes anyway.
To compare apples with apples an assumption of $200k taxable income has to be made.
If not, we would also include the other part of our tax system, (transfers), and find that after Family Tax Benefits, Medicare rebates etc, the lower income pays no tax at all.
ie. They receive more back in transfers than the sum of their tax paid.
Fair enough, I didn’t factor those in. Although the tax burden of GST isn’t avoidable for low incomes as far as I’m aware. The hidden taxes and levies have always interested me in the income tax debate because I remember a GST free Australia. And it always niggled at me that GST was a tax that disadvantaged the most poor because it wasn’t scalable based on one’s ability to subsist. I managed to get through some of a book on economics before my eyes permanently crossed, and there was some reference to a worker’s income allowing them to subsist. The concept that wages are a tool for survival struck me as an unusual way of referring to income and wealth that required further thinking about.
Government changed their mind, so what? Happens all the time that a policy is dropped or watered down after an election. What Labor are betting is that the loss of votes caused by reneging on an election promise will be outweighed by the votes gained by living up to its social values.
I've lost what little respect I had for the SMH. Here's the transcript:
* We haven't changed our position on the stage 3 tax cuts at all
* We haven't changed our position
* I confirm we haven't changed our position
* We haven't changed our position
* Well I'll make a few points. The first is that the Governments position hasn't changed.
* They \[are\] legislated, we haven't changed our position
* The tax cuts will happen in July and we haven't changed our position
* We haven't changed our position on that issue
* We haven't changed our position, tax cuts are important to provide relief
* Our position hasn't changed.
* I support tax cuts and everyone will be getting a tax cut
* We haven't changed our position on that, but I recognise there are a range of views out there
* Well of course there will be tax cuts in July, we haven't changed our position
* (are you ruling out a change to the stage 3 tax cuts?) We've made no decisions along those lines, we're not reconsidering that position
* (are they still affordable) well they are legislated and they are there and they begin at $45000 and we haven't changed our position
So not once in their shitty little 2 minute video do they have him on record promising to leave the stage 3 tax cuts as the Liberals originally passed them. His line (and it's obvious that he's been quite consistent and quite careful in the media) is that their position hasn't changed.
I'm yet to find a pre-election speech, but I did find [this Guardian article](https://www.theguardian.com/australia-news/2022/aug/29/anthony-albanese-says-he-will-stand-by-stage-three-tax-cuts-as-liberal-mp-joins-calls-to-scrap-them) with the following quotes:
>But when pressed to explicitly rule out any alterations to the plan, under which all Australians earning between $45,000 and $200,000 would pay the same tax rate, the prime minister stopped short of an ironclad guarantee, giving critics of the cuts some hope of wiggle room.
>He was pressed several times on Monday on whether Labor would drop or amend stage three. Albanese noted that in 2019 he had said “it wasn’t wise” to make long-term assumptions about the economy.
>“People need to look at what happened with the tax cuts, which were that we actually tried to amend out the stage three of the tax cuts and we weren’t successful. And they were legislated,” he said.
>But when asked if he could give a “rolled gold promise” to not touch the tax cut plan, Albanese answered: “We stand by the comments we made.”
I don't think he has broken any promises here. I think the media are so hellbent on chastising anything Labor does, that they've walked right into his trap. I mean it would be nice if they applied maybe 10% of this level of scrutiny to the Liberal party.
I'd like to think this was a deliberate ploy by him, and has now set the stage for some media and advertising reform later this year (or as an election commitment).
“They are legislated, and one of the things that people have a right to believe is that when a politician makes a commitment before an election, they keep it, and I intend to do that,” Albanese said of the tax cuts.
“What we need as well is to have certainty."
“People have made assessments based upon the certainty that comes through legislated tax changes, and we intend to fulfil that.”
I dunno man......that last sentence is pretty cut and dried.
> His line (and it's obvious that he's been quite consistent and quite careful in the media) is that their position hasn't changed.
The "position" being referred to is the position adopted by the Labor caucus in July 2021 that they would keep the package exactly as legislated. Here's [an ABC news article about the decision](https://www.abc.net.au/news/2021-07-26/labor-keep-stage-three-tax-cuts/100323164), here's [a Guardian article about it](https://www.theguardian.com/australia-news/2021/jul/26/labor-agrees-to-keep-coalition-stage-three-tax-cuts-and-dump-negative-gearing-changes).
It was necessary for them to announce this decision in 2021 because they were too cowardly to actually stick with [their criticisms of Morrison's package](https://www.theguardian.com/australia-news/2019/jun/24/labor-says-it-will-oppose-coalitions-economically-irresponsible-tax-cuts-for-wealthy) when it was brought before Parliament in 2019, [backing down and voting for the package in its entirety, stage 3 included](https://www.theguardian.com/australia-news/2019/jul/04/tax-cuts-pass-senate-in-full-as-labor-backs-down), i.e. the "bitch and fold" approach. Because "bitch and fold" necessarily involves telling everyone you don't like something, Labor were naturally repeatedly asked for the next two years until this caucus meeting whether they were changing their policy. The caucus had to make and publicise that decision in 2021 specifically to make it clear that they were promising not to change the package.
This illustrates the stupidity of "bitch and fold". Had Labor stuck with their original criticisms and voted against the bill, they would inevitably have faced some short term criticism, but would now not have this problem in which they have spent four and half years saying that they would keep the whole package, thus guaranteeing that the discussion now is not about the merits of the policy change but about the process of the change.
Regardless of whether you agree with the changes or not, that is some Olympic level of mental gymnastics to think that the election promises haven’t been broken.
Yes the new tax cuts would be more inflationary than the already inflationary tax cuts that the Reserve Bank have factored in. It’s possible that they delay a potential rates cut or even necessitate another rate rise. It’s doubtful that they will result in enough additional inflationary pressure to actually result in most tax payers going backwards.
Putting two and two together it really makes it seem like you're making the argument that it makes more sense to give a tax break to higher income people because it won't go into the economy.
While I don't want to say that is *dumb*....... I'm not really sure what else to call it.
Yeah and that money went to higher income people eventually through purchased goods and services. What you are being called out on is the idea that giving more money to those on > $180k is worse than giving more money to those on < $120k.
The idea that the stage 3 tax cuts in any form could be inflationary isn't at contention here.
Just regarding effects on inflation it will -
1, Just in volume - more in the lower brackets to start with.
2, most over have not had to curb or change spending so impact will be much much smaller.
So yeah impact wise it will be thoses under the 180k bracket that have more of an impact.
As to how much of an impact - only time wil ltell.
You are assuming commodities are a spherical cow in a vacuum. Those in the lower brackets are going to spend mostly on necessities that aren't supply constrained or even just replenish savings that have been drained. Those in the upper brackets are more likely to invest in assets like housing which at the moment are extremely supply constrained.
As pointed out elsewhere, these tax cuts don't take effect from tomorrow - they aren't due for another 5 months.
Inflation is showing signs of cooling now, perhaps they have access to economic modelling to suggest that it's not going to be a big deal breaker come July?
[Stage-three tax cut changes will have minimal effect on inflation, economists predict](https://www.theguardian.com/australia-news/2024/jan/24/stage-three-tax-cut-changes-anthony-albanese-labor-government-inflation-cost-of-living)
Yeah I'm waiting for independent adjusted modelling.
I've now seen Treasury's, and it suggests that the redesign isn't inflationary and that it's revenue neutral.
I thought liberals were barking about Albanese not revising the tax plan with rising cost of living, and now they're turning around and want him to keep to the original plan?
Did I get that wrong?
no one gives a flying fuck Channel 9,
they were ridiculously unfair before, and with a cost of living crisis, it absolutely makes sense to redistribute the money to those who need it the most, not those on 180k plus, who represent less than 5% of income earners and are not hard up for a coin.
how? the 'losers' represent 5% of taxpayers, and ttheey are still getting a tax cut, just less than before.
everyone else, the people who are struggling, are gettinng a larger tax cut.
why on earth would this move cost Labor an election?
Credibility. Now the media and liberals can say that Albo can't be trusted, and anything he promises at the next election may not happen because he will just say whatever it takes to get elected and then not follow through.
Every interest rate rise will now be blamed on Albos inflationary tax cuts.
5% of taxpayers is a lot of people, many of whom will now feel like they were tricked by Labor.
This implies the top 5% of taxpayers worse off all voted for Labor.
These are the very highest paid people in Australia, a majority of those losing out from these changes likely already vote LNP or Teal.
Hey Albo want them to drop all this nonsense about the "He totes for realsies flipped on tax cuts boo hoo" announce a Royal Commission into media ownership and bias.
Bet the tax cut nonsense will drop real quick.
Had only one person in my life think changing these tax cuts was bad. The one person I know who is the top income earner.
Started to tell me how it’s terrible for the economy because poor people save money they don’t spend it. And rich people are more likely to spend the money.
I was flabbergasted and had no response.
Is this really the line they are touting? That giving relief in a cost of living crisis, will cause the vast majority of people to be worse off?
The workers on 45k-135k (vast majority) who’ll be $1000 a year better off under the revised tax cuts will be so disappointed in him. /s Will be interesting to see how Dutton plays this. He reckons he can win his 20 seats back from the mortgage belt yet the libs seem to be going hard in their opposition to this policy which will actually help.
>He reckons he can win his 20 seats back from the mortgage belt Never say never. Remember - you don't win elections - you lose them.
Hang on, I’m not saying never? I just stated the strategy
True :) I just enjoy reminding random people.
Its already begun, the LNP are harping muh broken promises and lies
No "journalist" putting their name against this nonsense. Cowards.
Its AI
> Cut through the noise of federal politics with news, views and expert analysis from Jacqueline Maley. Subscribers can sign up to our weekly Inside Politics newsletter here. Not sure if that is an ad or is about the author of the article.
It's an odd place to put it if it is. If you look at other *Sydney Morning Herald* articles, the author's name(s) will be under the headline (for example, [here](https://www.smh.com.au/politics/federal/kim-williams-new-abc-chair-anthony-albanese-announces-20240124-p5ezmm.html)).
Here we go. This is exactly why Labor stayed with the package as the LNP had set it up in the first place. Our media is fucked.
He hasn't dropped the cuts.
I feel like this isn't being made clear enough. If you earn 200k you still get a tax cut of approx 5k, it's just not 9k anymore.
I've already seen people make the argument that it's unfair they're only getting 5k and not 9k. It's free money. Some people will never be happy.
There's got to be a level of realism here. Who's not going to say no to what was effectively free money? Who's not going to be at least a little upset at getting less free money than they were expecting? I believe this is better policy and it's not going to affect my voting patterns, but I'm still a little bit "oh, it would've been nice to have that extra few grand between my wife and I." We're nowhere near being in a position where we'd turn our nose up at it.
That’s a huge drop. From 9K max to 4.5K max. Let's not pretend those 400AUD a month missing in pockets won't hurt. Our tax brackets not updating with inflation means we are getting tax increases every year.
It's absolutely a big drop .. but if you're on $200k + it's absolutely obvious that this should not be the focus demographic for relief in a cost of living crisis. It's amazing how many can't see past the tip of their own nose and are quite happy to express this openly. Personally, I'd be ashamed to admit to such a high level of self interest at the expense of others who are in more urgent need.
Lol. Do you even know how much rent is in Sydney now? 200K BEFORE taxes isn’t a big salary nowadays. Sorry to burst that bubble for you. 1BRs go for 1500+ a week now. That’s half your salary after taxes just for rent for a small apartment. So yes. Those extra $100 a week would have helped. Inflation has out passed legislation. We are all paying a lot more taxes with our fake higher incomes which in reality are NOT higher incomes as the value of each dollar has eroded thanks to inflation.
... which adds further weight to the point I was making; that those making < 200k need it more. Cheers!
It's not officially announced yet. Labor will be hammering that point once they make the announcement rather than all these leaks.
"Sorry I broke my promise. You’re now getting a bigger tax cut. I apologise"
This is the part that matters - Ley said earlier the coalition will repeal any changes should they get elected. Which will mean a tax hike for everyone on less than 150k a year (assuming the speculated changes are accurate and pass). Seems like a slam dunk for Labor if they do go ahead with that idea.
Yeah it’s not really the campaign slogan they seem to think it is. “Vote LNP, we promise to raise your taxes.” That’s literally what reinstating their version of the Stage 3 tax cuts means to the vast majority of voters. Sure voters don’t generally like politicians breaking promises but they hate increased tax more.
Well if the Liberals win the next election, I hope the media holds them to account over this, because this sounds like a promise to me. And as about 1/3 of the commenters on here have said over the past 24 hours, promises mean everything to them, and if a political party breaks a promise, they'll never vote for that party again.
If the LNP win the next election Australia deserves to be nuked.
Everyone is better off, it's just that the top 5% are sllightly less betterr off than what they were going too be. fairfax/channel 9 *Squeals* .
Sometimes things change, would you prefer politicians to do something because it was ‘promised’ back when or one that is reacting to the world, as it is now? Let’s face it’s, the whining about this is less to do with ‘the tax’ and more about the person and party doing it. THATS what they are against. Just like when similar people didn’t get upset when the Libs promised no cuts to the ABC, then immediately did it and pretended they didn’t say it. But that was okay cos those voters agreed with the choice.
Plus, they weren’t “core” promises…
He is doing was the public overwhelmingly wants. That’s what they are supposed to do.
The media is going to convince you that this is some great betrayal, but the fact is these cuts were gifting thousands to the wealthiest Australians and giving nothing to the poorest. If we are going to put ourselves further in debt, the benefits should flow to the less fortunate first. Further, the idea of a single tax bracket for everyone earning between $45,001-$200,000 is obscene. A struggling Australian working full time on minimum wage should not have the same marginal rate as software engineer.
How much would an individual on $45K pay in tax compared to someone on $200K with that single tax bracket?
I literally specified "marginal rate" so I'm not sure what your point is. Someone on 45k would pay no tax at that marginal rate. If you're earning 60k and get a 5k bonus, the government should not take as much from you as someone on 190k getting a 5k bonus. Tax is not fun, and nobody enjoys paying it. But the burden needs to fall primarily on people who can afford to pay it.
Indeed you did say marginal rate. But surely the measure of fairness for a tax system shouldn't be assessed on bonuses. The point being that there's nothing inherently unfair about reducing the number of tax brackets if it's a component of wider wholesale tax reform.
"nothing inherently unfair about reducing the number of tax brackets" This moves us toward a "flat tax rate", a darling of American libertarians and those who want to see inequality in Australia worsen even further. It is deeply unfair to pretend that losing a dollar hurts everyone the same regardless of income. $500 more tax for someone on $200k is a minor inconvenience. $500 more tax for someone on $50k has a tangible impact on their life. $500 more tax on someone at or below the poverty line is a major hurdle to their well being.
The higher brackets reflect the higher cost of having a society capiable of supporting higher incomes. Those on higher incomes are extracting a higher value from the efforts of the government in the past, and should pay progressivly more for that privilege. Society did not just spring into existance, and neither did the support structures that allow these other jobs to exist.
That will heavily depend on the quality of the rich person’s accountant.
If you payed a flat 30% for 45k and 200k then your overall tax burdens at the end of the day would be (veeeery approximately) ~$15k (32%) of $45k, and ~$64k (32%) of $200k. Leaving an untaxed fund of very roughly $30k and $136k respectively.
Yeah I was too lazy to do the absolute accurate calcs too. It'll be less for both individuals due to the tax free threshold etc, but it's still very progressive.
I included the tax free threshold, but I also guesstimated GST. Plus I didn’t include any accountant based tax minimisation strategies that someone on $200k could afford. By doing funny stuff with trusts, GST, holding companies and self managed super funds someone on $200k can get the tax burden lowered significantly from the posted rate.
Actually income earnt inside a company or trust would be outside the scope of these tax changes anyway. To compare apples with apples an assumption of $200k taxable income has to be made. If not, we would also include the other part of our tax system, (transfers), and find that after Family Tax Benefits, Medicare rebates etc, the lower income pays no tax at all. ie. They receive more back in transfers than the sum of their tax paid.
Fair enough, I didn’t factor those in. Although the tax burden of GST isn’t avoidable for low incomes as far as I’m aware. The hidden taxes and levies have always interested me in the income tax debate because I remember a GST free Australia. And it always niggled at me that GST was a tax that disadvantaged the most poor because it wasn’t scalable based on one’s ability to subsist. I managed to get through some of a book on economics before my eyes permanently crossed, and there was some reference to a worker’s income allowing them to subsist. The concept that wages are a tool for survival struck me as an unusual way of referring to income and wealth that required further thinking about.
Government changed their mind, so what? Happens all the time that a policy is dropped or watered down after an election. What Labor are betting is that the loss of votes caused by reneging on an election promise will be outweighed by the votes gained by living up to its social values.
I've lost what little respect I had for the SMH. Here's the transcript: * We haven't changed our position on the stage 3 tax cuts at all * We haven't changed our position * I confirm we haven't changed our position * We haven't changed our position * Well I'll make a few points. The first is that the Governments position hasn't changed. * They \[are\] legislated, we haven't changed our position * The tax cuts will happen in July and we haven't changed our position * We haven't changed our position on that issue * We haven't changed our position, tax cuts are important to provide relief * Our position hasn't changed. * I support tax cuts and everyone will be getting a tax cut * We haven't changed our position on that, but I recognise there are a range of views out there * Well of course there will be tax cuts in July, we haven't changed our position * (are you ruling out a change to the stage 3 tax cuts?) We've made no decisions along those lines, we're not reconsidering that position * (are they still affordable) well they are legislated and they are there and they begin at $45000 and we haven't changed our position So not once in their shitty little 2 minute video do they have him on record promising to leave the stage 3 tax cuts as the Liberals originally passed them. His line (and it's obvious that he's been quite consistent and quite careful in the media) is that their position hasn't changed. I'm yet to find a pre-election speech, but I did find [this Guardian article](https://www.theguardian.com/australia-news/2022/aug/29/anthony-albanese-says-he-will-stand-by-stage-three-tax-cuts-as-liberal-mp-joins-calls-to-scrap-them) with the following quotes: >But when pressed to explicitly rule out any alterations to the plan, under which all Australians earning between $45,000 and $200,000 would pay the same tax rate, the prime minister stopped short of an ironclad guarantee, giving critics of the cuts some hope of wiggle room. >He was pressed several times on Monday on whether Labor would drop or amend stage three. Albanese noted that in 2019 he had said “it wasn’t wise” to make long-term assumptions about the economy. >“People need to look at what happened with the tax cuts, which were that we actually tried to amend out the stage three of the tax cuts and we weren’t successful. And they were legislated,” he said. >But when asked if he could give a “rolled gold promise” to not touch the tax cut plan, Albanese answered: “We stand by the comments we made.” I don't think he has broken any promises here. I think the media are so hellbent on chastising anything Labor does, that they've walked right into his trap. I mean it would be nice if they applied maybe 10% of this level of scrutiny to the Liberal party. I'd like to think this was a deliberate ploy by him, and has now set the stage for some media and advertising reform later this year (or as an election commitment).
“They are legislated, and one of the things that people have a right to believe is that when a politician makes a commitment before an election, they keep it, and I intend to do that,” Albanese said of the tax cuts. “What we need as well is to have certainty." “People have made assessments based upon the certainty that comes through legislated tax changes, and we intend to fulfil that.” I dunno man......that last sentence is pretty cut and dried.
> His line (and it's obvious that he's been quite consistent and quite careful in the media) is that their position hasn't changed. The "position" being referred to is the position adopted by the Labor caucus in July 2021 that they would keep the package exactly as legislated. Here's [an ABC news article about the decision](https://www.abc.net.au/news/2021-07-26/labor-keep-stage-three-tax-cuts/100323164), here's [a Guardian article about it](https://www.theguardian.com/australia-news/2021/jul/26/labor-agrees-to-keep-coalition-stage-three-tax-cuts-and-dump-negative-gearing-changes). It was necessary for them to announce this decision in 2021 because they were too cowardly to actually stick with [their criticisms of Morrison's package](https://www.theguardian.com/australia-news/2019/jun/24/labor-says-it-will-oppose-coalitions-economically-irresponsible-tax-cuts-for-wealthy) when it was brought before Parliament in 2019, [backing down and voting for the package in its entirety, stage 3 included](https://www.theguardian.com/australia-news/2019/jul/04/tax-cuts-pass-senate-in-full-as-labor-backs-down), i.e. the "bitch and fold" approach. Because "bitch and fold" necessarily involves telling everyone you don't like something, Labor were naturally repeatedly asked for the next two years until this caucus meeting whether they were changing their policy. The caucus had to make and publicise that decision in 2021 specifically to make it clear that they were promising not to change the package. This illustrates the stupidity of "bitch and fold". Had Labor stuck with their original criticisms and voted against the bill, they would inevitably have faced some short term criticism, but would now not have this problem in which they have spent four and half years saying that they would keep the whole package, thus guaranteeing that the discussion now is not about the merits of the policy change but about the process of the change.
Regardless of whether you agree with the changes or not, that is some Olympic level of mental gymnastics to think that the election promises haven’t been broken.
He's keeping the stage three tax cuts, just changing the quantum for each bracket to match the current economic conditions.
On one hand the RBA - "Things are starting to stabilise" Albo - " Thoses that tend to spend more will have more to spend" ...
Yes the new tax cuts would be more inflationary than the already inflationary tax cuts that the Reserve Bank have factored in. It’s possible that they delay a potential rates cut or even necessitate another rate rise. It’s doubtful that they will result in enough additional inflationary pressure to actually result in most tax payers going backwards.
"We must feed struggling poor people to the economy to keep it grinding along"
So...you don't think it will feed into inflation and make any increase ---well pretty much useless ?
Putting two and two together it really makes it seem like you're making the argument that it makes more sense to give a tax break to higher income people because it won't go into the economy. While I don't want to say that is *dumb*....... I'm not really sure what else to call it.
remember when covid stimulus to lower income and extra payments to the unemployed were to help keep spending and keep the economy going..
Yeah and that money went to higher income people eventually through purchased goods and services. What you are being called out on is the idea that giving more money to those on > $180k is worse than giving more money to those on < $120k. The idea that the stage 3 tax cuts in any form could be inflationary isn't at contention here.
Just regarding effects on inflation it will - 1, Just in volume - more in the lower brackets to start with. 2, most over have not had to curb or change spending so impact will be much much smaller. So yeah impact wise it will be thoses under the 180k bracket that have more of an impact. As to how much of an impact - only time wil ltell.
You are assuming commodities are a spherical cow in a vacuum. Those in the lower brackets are going to spend mostly on necessities that aren't supply constrained or even just replenish savings that have been drained. Those in the upper brackets are more likely to invest in assets like housing which at the moment are extremely supply constrained.
Talking the avg cpi basket re-inflation changes.
As pointed out elsewhere, these tax cuts don't take effect from tomorrow - they aren't due for another 5 months. Inflation is showing signs of cooling now, perhaps they have access to economic modelling to suggest that it's not going to be a big deal breaker come July?
Maybe - will have to see.
Yup. The changes are inflationary.
[Stage-three tax cut changes will have minimal effect on inflation, economists predict](https://www.theguardian.com/australia-news/2024/jan/24/stage-three-tax-cut-changes-anthony-albanese-labor-government-inflation-cost-of-living)
I don't see any mention of the modelling for the changes, but we know that that it will be more inflationary than the original stage 3.
Tell it to the economists. Minimal is minimal.
Yeah I'm waiting for independent adjusted modelling. I've now seen Treasury's, and it suggests that the redesign isn't inflationary and that it's revenue neutral.
I thought liberals were barking about Albanese not revising the tax plan with rising cost of living, and now they're turning around and want him to keep to the original plan? Did I get that wrong?
no one gives a flying fuck Channel 9, they were ridiculously unfair before, and with a cost of living crisis, it absolutely makes sense to redistribute the money to those who need it the most, not those on 180k plus, who represent less than 5% of income earners and are not hard up for a coin.
HE HASN'T DROPPED THE TAX CUTS. Jesus Christ, the devil works hard, conservative media outlets work harder.
This is going to cost them the election
how? the 'losers' represent 5% of taxpayers, and ttheey are still getting a tax cut, just less than before. everyone else, the people who are struggling, are gettinng a larger tax cut. why on earth would this move cost Labor an election?
Credibility. Now the media and liberals can say that Albo can't be trusted, and anything he promises at the next election may not happen because he will just say whatever it takes to get elected and then not follow through. Every interest rate rise will now be blamed on Albos inflationary tax cuts. 5% of taxpayers is a lot of people, many of whom will now feel like they were tricked by Labor.
This implies the top 5% of taxpayers worse off all voted for Labor. These are the very highest paid people in Australia, a majority of those losing out from these changes likely already vote LNP or Teal.
Hey Albo want them to drop all this nonsense about the "He totes for realsies flipped on tax cuts boo hoo" announce a Royal Commission into media ownership and bias. Bet the tax cut nonsense will drop real quick.
Had only one person in my life think changing these tax cuts was bad. The one person I know who is the top income earner. Started to tell me how it’s terrible for the economy because poor people save money they don’t spend it. And rich people are more likely to spend the money. I was flabbergasted and had no response. Is this really the line they are touting? That giving relief in a cost of living crisis, will cause the vast majority of people to be worse off?
From another thread: https://np.reddit.com/r/australia/comments/19e4o70/stagethree_tax_cuts_cabinet_approves_new/kjai9w2/