Peter Martin, the economics editor at the Age writes… “The finance minister is two-thirds right. He says if the government can’t balance its books by cutting spending, “the only alternative to balance the books is to increase taxes. There’s only one other option. It’s neither an increase in tax nor a cut in spending. It’s an attack on tax expenditures.”
Let me get this straight… an economist states that raising the super contribution rate (the tax expenditure he is suggesting we attack first) from 15% to marginal rates as high as 49% IS NOT AN INCREASE IN TAX. He states that removing the 50% CGT discount, thereby doubling the Capital Gains Tax paid, IS NOT AN INCREASE IN TAX…. Huh
Don’t get me wrong. I think the contributions and earnings tax on super needs to be increased but I am not mislead/dishonest/… enough to claim it is anything other than an increase it tax.
Peter, I suggest we don’t decrease government spending but rather we just give every government program and department less money… What is the difference I hear you say… About as much difference as increasing the individual tax rates (a increase in tax according to Martin) and increasing the super contributions tax (not a tax increase according to Martin).
If you don’t want to fix the budget by cutting spending Peter, then be honest and admit you have to increase taxes… And these are the tax increases I would do.