Budget Policy
8 June 2018
Four myths about income tax
When income tax scales change, it’s inherently a question of redistribution. Any change to tax rates is a decision about who should bear less — or more — of the tax burden. And because of bracket creep, any decision not to change tax rates is also a decision to shift the tax burden.
7 June 2018
Government’s creepy tax hike habit
Sometimes, just sometimes, budgets change the national economic debate. Since the controversial 2014 budget – widely perceived as being unfair – debate quickly jumps to the “fairness” of any new policy proposal. The enduring legacy of the 2018 budget is that ordinary taxpayers are a whole lot wiser about stealth tax rises through bracket creep.
6 June 2018
Debunking some of the myths in the great tax debate
The debate about the Turnbull Government’s proposed personal income tax cuts is dominated by myths. In his opening statement to a Senate committee inquiry into the tax plan, Grattan’s John Daley urged MPs not to play on the myths but instead to face facts and be honest with voters.
4 June 2018
Are the proposed personal income tax cuts affordable and fair?
The Turnbull Government’s planned personal income tax cuts are the largest ever proposed in a federal budget. As Grattan’s Danielle Wood, John Daley and Hugh Parsonage write in this submission, the substantial reduction in revenue is not obviously consistent with the Government’s medium-term fiscal strategy of budget surpluses on average over the economic cycle.
31 May 2018
Beyond dividend imputation: better ways to improve the budget
Federal Labor’s dividend imputation policy is a fair way to help improve the budget and wind back the growing intergenerational transfers built into our tax system over the past two decades. But there is a better way, as Grattan’s Danielle Wood writes in the Australian Shareholders’ Association magazine.
23 May 2018
Is the personal income tax package a tax reform or just a tax cut?
The Turnbull Government says its personal income tax plan deserves to be called tax ‘reform’. But Grattan’s Danielle Wood says tax reform would be taxing resource rents more heavily to help fund the reduction in the company tax rate, and broadening the GST at the same time as offering income tax cuts (and increasing welfare payments).
11 May 2018
The Coalition’s tax plan favours the rich and doesn’t solve bracket creep for middle-income earners
The top 20 per cent of income earners in Australia will benefit most from the Turnbull government’s tax plan, unveiled in the 2018 budget. Our analysis shows most of the revenue reductions to government from the plan are the result of lower taxes on high-income earners.
10 May 2018
Grattan modelling of the government’s Personal Income Tax Plan highlights costly cuts to taxes for high-income earners
Most of the revenue reductions from the Turnbull Government’s Personal Income Tax Plan are the result of lower taxes on high-income earners. Grattan analysis shows that once the three-stage plan is complete, $15 billion of the annual $25 billion cost will result from collecting less tax from the top 20 per cent of income earners.
9 May 2018
Budget 2018: built on good fortune, relying on luck
Scott Morrison was all smiles as he handed down his pre-election budget on Tuesday night. Economic good times — at least compared to forecasts — allowed him to announce income tax cuts and an early return to surplus while making very few difficult spending decisions. But the new medium-term target of capping taxes as a share of the economy will only be achievable with superhuman spending restraint: and both history and demographic forces will be against him.
7 May 2018
Five ways the Treasurer could boost the budget bottom line
Treasurer Scott Morrison faces a difficult balancing act in the federal budget. He wants to cut income taxes, deliver new infrastructure spending and still reach a surplus by at least 2019. If he’s serious about maintaining the surplus, here are five ways the Treasurer could boost revenue to make the numbers work.