RBA move makes tax cuts vitally important: economists

Tax refund could be yours by next week, says Treasurer.

tax cuts

Low and middle-income earners could pocket their $1080 refund – stage one of a three-part $158 billion Morrison Government promise – as early as next week if the legislation successfully passes through the Senate this week.

As the Reserve Bank of Australia (RBA) announced a second consecutive cut in official interest rates – to one per cent, the lowest on record – Treasurer Josh Frydenberg said the Australian Tax Office (ATO) had informed him that workers could receive tax relief as soon as next week.

“People will get it next week,” he said, “once they put in their tax returns. If they put in their tax return next week, then they will get it just days after.”

The first stage of the tax promise, which passed through Parliament on Tuesday, will deliver up to $1080 to low and middle-income earners when they lodge their tax returns. It increases the amount of money available through the low and middle-income tax offset from $530 to $1080.

The second stage will top up a low-income tax offset, which means more people – earning up to $45,000 instead of $41,000 – will get a 19 per cent tax rate.

The final stage would take effect from mid-2024 and flatten the tax rate from 32.5 per cent to 30 per cent for people earning between $45,000 and $200,000.

The anticipated tax cuts are likely to benefit many older Australians, according to YourLifeChoices’ most recent survey, 2019 Ensuring Financial Security in Retirement, which found that 39.4 of people aged 55 to 70 were working full or part-time.

Senior economist with The Australia Institute, Matt Grudnoff, said any tax relief packages needed to be “well-targeted if they are to maximise economic growth”.

“Low and middle-income taxpayers are more likely than high-income taxpayers to spend their tax cuts and stimulate the economy,” he told The Guardian.

“The increased low and middle-income tax offset in stage one (a) will cost the budget less money and proportionately benefit more people than stage 3(a).

“The stage 3(a) income tax cut is expected to cost the budget $95 billion over five years.

“The Government will spend more on this part of the tax cut than it is expected to spend on the Pharmaceutical Benefits Scheme over the same period.”

The RBA announced the 0.25 percentage point rate cut – the first back-to-back cuts since 2012 – at a board meeting in Darwin.

KPMG chief economist Brendan Rynne told The Age the move put pressure on the Government to consider other ways to boost the economy and made the unlegislated cuts particularly important.

“The RBA is sending a signal to the market, to politicians and to the community at large, that the Australian economy is not firing on all cylinders and, as one of the guardians of national welfare, the RBA is looking to help out where it can,” he said.

“So this really puts the onus on the Government to bring forward fiscal stimulus – by getting new targeted infrastructure projects up and running and ensuring the proposed tax breaks are brought into law soon as possible.”

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    COMMENTS

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    Adrianus
    3rd Jul 2019
    8:09am
    Needless to say, Labor is opposing the tax cuts Bill. Labor would rather allow the economy to go to hell in a hand basket than let the government fix things. Yes even if it means exposing their lack of concern for the financial struggles of those who once were Labor's raison detre, the worker.
    Paddington
    3rd Jul 2019
    10:15am
    Adrianus, wrong! Labor supports the first two parts, bringing forward part two. They have passed all of it in the lower house to expedite discussion in the senate.
    The economy going to Hell in a hand basket is more complex than what you are inferring. This won’t do it on its own. People need to spend and a broader stimulus by way of construction etc to prevent further downtown of the economy.
    If the two parts of the tax went through the top earners still get something but to set something in place that is four or five years away seem nonsense to me.
    It looks like it will go through anyway because of the cross benchers using a bit of clout to get something for their constituents.
    Your beloved LNP will get it all through anyway so stop whinging!
    john
    3rd Jul 2019
    10:34am
    Correct Adrianus, the Labor party is, no more, in my opinion.
    Now after getting a beating at the polls, they become the perennial dog in the manger party , stymie anything to make a point , well I think they may have backed off.

    But them (ALP) and the union movement forgot the working man quite a long time ago.

    This government now needs to be given the reigns and allowed to develop infrastructure and create jobs , because we are looking at an automated future society unlike we've seen before and human beings must... MUST!! ...have something to do.
    To Paddington.. the Government is looking at the future and the bolstering of confidence from big business and investors , who create jobs and need to profit , we are in a different world altogether, don't be blind to that, the future will see machinery take jobs by the thousands , business investors and people setting out to make profit , also have to be helped along even if the likes of some consider that a bit off putting, you will need those investors to create work.
    If you don't hand them some kind of tax relief carrot , Deserved or Not!!! There will be NO WORK, and then it'll really be "Helter Skelter" as Charlie's people wrote on the wall!

    Government needs to be allowed to help the nation al;ong , if we have drongos' and old race horses like Albo , nothing from them will change , and they damned well need to , you have to have good opposition in our system , not trouble makers in pettiness, and foolishness, let the government govern and let the cross benches do what they are supposed to, help out not destroy! That is whats happened in Australia for too long, governments not being able to govern, its time it stopped, its time sense and negotiation began instead of you kick me I'll kick you!!!!!
    TREBOR
    3rd Jul 2019
    10:57am
    Read what I wrote below, Adrianus - that's because this is being used as a political football and is not in line with the concept of government actually serving the people it represents... but serving itself first in using such things as a tyre lever on the heads of the Opposition, who have no choice unless they want to look greedy but to oppose it.

    Labor is opposing a cut for the top ranks - which include themselves - it is the LNP that has put the demand that it's "take it or leave it" - and you know how I deal with ultimata...

    ''NUTS!"
    Misty
    3rd Jul 2019
    12:56pm
    John. nothing is stopping this govt from building more infrfastructure, certainly tax cuts have nothing to do with that and I doubt the small amnt people who pay tax get back will make any difference to their spending, they will probably put it away for the rainy. hurricane day forecast to be coming.

    What infrastructure has the Federal Govt built in the last 6 years, where are the new dams so desperately needed, hospitals, schools and roads and public housing needed to cope with our growing population? No the surplus is far more important in their eyes then getting the economy mooving.
    GeorgeM
    3rd Jul 2019
    9:24pm
    Lots of wrong statements from Liberal & Labor types. Labor only pretended to oppose the tax package, due to the massive tax cuts ($11,640 for those on $200K+ income) benefitting ALL MPs - they could not pass that up, could they! Hence, they passed it in the Lower House. Now it is left to a handful of Senators (3 needed - 2 from Centre Alliance and J.Lambie naming their price now) to pass it in the Senate with Labor being irrelevant!

    Let's be clear - once self-interest has been put forward, ALL such legislation will pass. The voters stupidly led down the country by voting back in known self-seekers from BOTH major parties, and will now pay the price.
    The real priorities over the 3rd stage massive tax cuts should have been:
    a. Reversal of the nasty Assets Test changes from Jan 2017 implemented on a Budget Emergency lie - so how come they can now afford $95Billion for the 3rd stage???
    b. Infrastructure spending BADLY needed to i) Bring down power prices, ii) Ensure Water storage dams and network built, iii) Generate real jobs through such programs.

    Are they working for the Australian people or themselves? No prizes for guessing the answer!
    Farside
    4th Jul 2019
    12:24am
    There are plenty of opportunities to stimulate the economy through productive infrastructure spending so it astonishes me the continuing focus by pollies, media and commentary on energy prices when average annual energy bills (~$1,600) are such a small part of average annual household income (~$110,000). Reducing energy consumption costs by even half will only make households better off by about $50 per month, an amount which is most meaningful to those needing assistance with making ends meet.
    Adrianus
    4th Jul 2019
    11:26am
    Farside, Try to think of any rising cost in terms of how rapid the cost rises in comparison to income and you will understand why there is so much focus on the increasing cost of household energy.
    GeorgeM
    5th Jul 2019
    12:07am
    Farside, your silly comment shows you have no understanding of how increasing energy prices are known to a) cause exceeding hardship for those on limited income, with perhaps over a million on low incomes affected, and b) how high energy prices are a key cost for businesses both small and large, with many small businesses going under as a result. If they try to increase their prices, naturally the consumer also gets hit with higher prices. With our massive resources of coal, gas, uranium, etc, we should instead be having the lowest energy prices in the world - if only we invested wisely.
    Farside
    5th Jul 2019
    10:20am
    George, I said low income households should get meaningful support with their energy costs, even $50/mth would halve the average bill but these million or so are not your average household. The fact you find it silly does not surprise me. Energy costs are a small fraction of household spending and they receive more headlines than other other elements like housing, transport, food, health, recreation and entertainment – reductions in these costs would be far more meaningful to low income households.
    https://static.moneysmart.gov.au/images/infographic/australias-spending-habits-2018.svg

    I did not discuss energy in terms of business costs. How many small businesses have gone under solely because of energy prices?

    Good luck with attracting investment in coal, gas and uranium generation; boat sailed on that issue long ago. A domestic gas reservation policy should be the priority to mitigate the rate of increases.
    Farside
    5th Jul 2019
    10:53am
    I take your point Adrianus that energy costs have risen quickly. We know the reasons for this - networks, market manipulation, exports etc. My point however is that energy costs is one of the smaller elements of household spending and that the savings from even a halving of average energy bills would be quickly taken up elsewhere.
    Misty
    5th Jul 2019
    10:54am
    Farside my electricity bill is roughly $$1,000.00 every quarter even after SoLar Rebate and pensioner discount $50.00 a month would help a little but not that much, we don't have gas but use wood heating in the winter. Itw ill be interesting to see if they have a referendum on Nuclear Power soon won't it, MP John Barillaro wants one.
    Farside
    5th Jul 2019
    11:46am
    Misty, the average bill is $1600. Yours is more, some will be less. My inlaws (Newstart soon on pension) in FNQ also pay around $3500 and my mother's partner (SFR) in WA pay a little over $4000. Wood is expensive for heating unless you have your own supply so this would add to your burden.

    Current generation of nuclear reactors will not help. There is no investment appetite for them and projects to build are being delayed or abandoned across the globe. The only hope for nuclear are the so-called Gen IV reactors, but let's hope the scientists take the lead on this in the Australian debate rather than muppets like Canavan and his cronies. Either way you won't be seeing much hit the grid in this space much before 2040 if at all.
    Adrianus
    8th Jul 2019
    11:04am
    John, very good post!

    As you elude to, as automation reduces the number of workers future governments will need to rely less and less on individual tax income. If only Labor/Unions/Greens had an eye to the future, we would find ourselves all moving in the same direction. Instead theirs is a simplistic focus, seize control of the budget, increase taxes and redistribute wealth. Thinking long term for Labor is 3 years. They can have 5 different positions on a policy in 5 weeks.
    KeWi
    3rd Jul 2019
    10:40am
    And as a tax cut, those that have not actually paid any tax should not see it - compared with the franking credits 'argument' - interesting that aspect does not seem to have been raised so far . . . .
    TREBOR
    3rd Jul 2019
    10:57am
    Interesting...... good point....
    Farside
    5th Jul 2019
    11:00am
    Grandma, if someone has "less assets and less income than countless thousands of pensioners" and chooses not to take a pension then that is their personal choice and more power to them. It is not something for them to laud over those who choose to take a pension.
    Misty
    5th Jul 2019
    10:42pm
    Farside you should know better now not too get on the bad side of whinging grandma, prveiously called Only Genuine Rainey and also Older and Wiser, those Franking Credit and pensioner comments are dead giveaways.
    Old Geezer
    6th Jul 2019
    9:04am
    Farside you can have a house worth many millions and still get the full old age pension. Infact it 8s a great idea to buy a house that only leaves you enough assets to qualify for the full old age pension on retirement. When you run out of cash just downsize with only enough cash to continue to qualify for the full pension. Keep repeating.

    Not only do you have a tax free appreciating asset but you get paid to have it. Many have seen the light.
    Farside
    6th Jul 2019
    1:39pm
    what is your point Geezer? Maximising non-assessable assets while maintaining pension eligibility is an obvious strategy.As you say many have seen the light and trading down the sweet spot as needs must. Those forced into early retirement but not eligible for welfare support have been doing this for years. Rainey just got her panties in a twist on calling her out over her not so wealthy SFRs expecting accolades for denying themselves the pension despite being eligible.
    Misty
    8th Jul 2019
    12:42am
    Well whinging grandma, you got that name right this time, why do you go on with the same old same, you do go on and on don't you, don't know why you want to keep changing your name on this site it is easy to tell who it is from your comments and as for sniping well you are a master at that.
    Misty
    8th Jul 2019
    12:42pm
    Insults will get you nowhere WG, I feel sorry for you if you have to resortt to insults to try to get a point across, time you had a holiday I think. Kaye I hope the moderator is checking these comments.
    mogo51
    3rd Jul 2019
    10:50am
    I agree with Paddington o n this issue. In order to have the public spend, there needs to be enough money in their pay packet for them to do so.
    It seems to me that since 'globalisation' took hold, only big business has benefited. I think most workers and small/medium business owners would agree.
    The gap is just too wide between our 'social groups'.
    TREBOR
    3rd Jul 2019
    11:02am
    An increasingly classed and stratified society, and soon to be no better than some petty Asian despotism like the fabled Singapore or China etc... Singapore being the representative of ultimate capitalism (jeez - shares aren't even taxed there - how does Joe Ordinary ever get off the economic floor?) and China having reverted to the ancient Mandrin style of ultimate riches for the top dogs and poverty for the rest with a few favourites in between.

    The more things change.... now all we need is for North Korea under The Fat Controller to come into the capitalist world, and reap the benefits, and then there's only Iran..... I'm sure Kim Rong Un would leap at the opportunity to become a mega billionaire like his Chinese counterparts.... and his honchoes would be slavering at the chops for the same....

    Welcome to Around the World With Trebor...
    TREBOR
    3rd Jul 2019
    10:53am
    Well ..... there is an argument about bracket creep - and I was just thinking this morning that this argument (regardless of full facts) parallels that of 'deeming' - and my second thought was that government chooses to persist with archaic and massively out-moded ways of doing things.

    It's a simple enough calculation annually to simply adjust for CPI or by some other yardstick, but of course, that would take away the opportunity for Santa Claus to come along and say there is a need for income tax relief... and pretend to be the Big Giver ...
    Janus
    3rd Jul 2019
    11:17am
    Weeks? Days? Tell me another one...

    When it has taken OVER 6 months for Centrelink to organise a Seniors health card (still not received) how can anyone (nobody on a pension, but especially if you were duped of a pension!) expect to get anything from this bunch.

    The only people who like the Libs are those that have plenty of cash and assets. To hell with the rest of us. Politics of Greed vs Politics of Compassion. You made your choice. It's all about the dollars.

    I see similar in Brazil, where the President was voted in resoundingly on a platform of increasing logging and clearing of their forests. Australia has just done something similar. Makes you wonder about the level of intelligence of the population.

    Had my whinge, off for a cuppa. Enjoy life whilst I still can, but keep up the fight.
    Sundays
    3rd Jul 2019
    1:37pm
    Yes, anyone who lodges a tax return knows the refund doesn’t come in a few days! They have already been told by the ATO that there would be no payment until the Legislation has passed, but now without consultation they are suggesting very quick refunds!
    Farside
    3rd Jul 2019
    6:38pm
    Janus says "The only people who like the Libs are those that have plenty of cash and assets." This is blatantly untrue; 50% more retirees vote conservative than for Labor and progressive politics.
    Misty
    3rd Jul 2019
    9:03pm
    I have to agreed with Janus this time Farside, those 50% you mention are probably the ones Janus is commenting about, have plenty of cash and asset, at least that is what I can ascertain from my wide range of friends and acquaintances.
    Farside
    4th Jul 2019
    1:14am
    Misty, I come across plenty of pov pensioners that would never entertain anything but voting for the party of Bob Menzies. I suspect there were also many pensioners seduced into voting One Nation or Palmer on the basis of the promised pension increases or anti-immigration policies and directed preferences to LNP. But the numbers don't lie.

    Surveys over decades consistently show at least 61% of retirees favour LNP (two party preferred).

    ABS reports 66% of retirees receive at least a part-pension, suggesting 34% are self-funded.

    For the sake of argument let's make a conservative assumption the bulk of SFRs, say 90%, voted LNP, which accounts for 31% of retirees voting LNP.

    This suggests the other 30% of retirees that vote LNP comprises those receiving at least a part pension.

    It is hard to argue all of this cohort has plenty of cash and assets on the one hand but then complain the 2017 cuts to the means tests were unfair. We also know from the election results that this cohort is probably larger as many of the large swings to Labor occurred in the wealthier established electorates like Higgins and Kooyong.
    Farside
    5th Jul 2019
    10:50am
    Grandma, so many LNP voting SFRs disliked Labor more than seeking revenge on the coalition; it just means they a slightly less rusted on but still voted LNP, just this time it was motivated by self interest rather than ideology. It did not change the fact the majority of retirees still vote LNP and that cohort includes many full and part pensioners. I don't expect it to change significantly before the boomer bulge shuffles off this mortal coil, regardless how well, or poorly, Labor campaigns.

    As for your 66 year old couple with $900k of assessable assets - I understand their circumstances but nup, don't feel sorry for them. They are better off than someone in a similar situation but five years younger or lost a fortune in the GFC or fell upon hard times. There are plenty of people having to survive on savings and investments, but they know there is a safety net if it goes pear shaped. Yes they have to consider long term but if they worry over the uncertainties of investing in the share market then they should invest elsewhere. You play the cards you are dealt.
    Not a Bludger
    3rd Jul 2019
    11:17am
    Labour having the effrontery to oppose/change this legislation simply highlights Labour’s inability to accept that the majority did not believe them and did not vote for them - the typical thug, union boss approach.
    Man, are they going to be in opposition for years to come!
    Farside
    3rd Jul 2019
    2:08pm
    Actually the majority did not vote for the LNP coalition; they won only 41% of the national votes counted, but don't let the facts get in the way of your story and opinion.
    https://www.abc.net.au/news/elections/federal/2019/results/party-totals
    Paddington
    3rd Jul 2019
    2:20pm
    Not England! LABOR here, mate!
    I am guessing from your chosen title you are anti unions, labor, pensioners, and anyone else who falls below your pecuniary value system.
    Not a Bludger
    3rd Jul 2019
    6:21pm
    Boo Hoo
    cupoftea
    3rd Jul 2019
    11:21am
    I have not paid tax this year but I hope I get paid the tax rebate that the same as them with franking credits
    Misty
    3rd Jul 2019
    1:03pm
    And pigs might fly cupoftea.
    Adrianus
    3rd Jul 2019
    1:53pm
    So put your money at risk and get some franked dividends? Hoping for something needs to be constructively formulated to goals which need to be acted upon. Otherwise hope alone will fade like a dream in the distant past.
    Farside
    3rd Jul 2019
    6:43pm
    you might be surprised Adrianus that many retirees thought they would losing their franking credit refunds despite thm not owning shares and had never received a refund cheque previously. As for putting money at risk and investing in franked shares ... never entered their minds that this was a necessary prerequisite. They were simply persuaded by the campaigning.
    Tanker
    3rd Jul 2019
    11:32am
    It is unlikely the LNP will make any changes to their current direction is they need to get the economy "in the black" to justify their devious approach during the election. The good of the country is secondary to the good of the party.
    Tax cuts to those on the upper tax brackets won't do the economy any good as it is unlikely they will spend on the sort of thing that will provide a boost. It is the ordinary wage earner who needs money in their pocket to give them the confidence, and the means, to spend to stop the downward spiral our economy is in. It is also downright stupid to lock in tax cuts that won't happen until after the next election. Who knows what situation the country will be in by then.
    The next few months will tell if ScoMo is essentially a snake oil salesman or has what it takes to be a real P.M. Frydenburg looks to be out of his depth at this stage but time will tell with him also. We could be in for a rough ride here so fasten your seat belts.
    Adrianus
    3rd Jul 2019
    2:00pm
    I think they will break their election promise to run a surplus. Just as Labor promised bigger and better surpluses, bigger and better tax cuts yada yada yada.. they would also be faced with the same problem. How best to stimulate the economy.
    At what moment in time do our politicians stop being politicians and act in accordance for the greater good?
    Farside
    3rd Jul 2019
    2:10pm
    "The good of the country is secondary to the good of the party." ... nailed it Tanker!
    Chuck
    3rd Jul 2019
    12:33pm
    Well here's a novel If SCMO's Government wishes to give away money to stimulate the economy. Get rid of the current Age Pension Scheme and re-introduce a Universal Age Pension for all 65 year olds with no income and asset tests.
    Tricky
    3rd Jul 2019
    1:29pm
    Thoughts and Prayers?
    Adrianus
    3rd Jul 2019
    1:42pm
    Chucky, there are two taxes that I don't like. Income tax on the worker and Payroll tax on the company. Both taxes serve to reduce incentive for growth and productivity.

    We are in big trouble atm if the RBA is trying to drop the value of the Aussie Dollar by tightening monetary policy. It shows how much we rely on mining exports to prop up our balance of trade. Our unemployment rate is low because the states have been bolstering their Public Services. en passant.. Had to laugh when I heard the Union bosses in QLD have called off strike action because the Labor State government has finally agreed to a pay rise for Teachers after an exhausting 3 hour negotiation. It's not just the extra money which people have in their pay packets, its also the feeling of confidence, and the inspiration which drives workers to achieve their personal goals. If we are to sail successfully through these headwinds then it will be on the back of the worker in private enterprse, not the frail and old who keep our hospitals busy and Doctors wealthy, not the public servants.
    Chuck
    3rd Jul 2019
    12:35pm
    ops: The beginning of my comments should read " novel idea".
    Misty
    3rd Jul 2019
    12:58pm
    Clive Palmer with his dishonest ads won the election for the govt, I hope new laws will address honesty in advertising for all political parties in the future.
    Adrianus
    3rd Jul 2019
    1:22pm
    Misty, I disagree. I think people are not only entitled to vote the way they like, but are a little smarter than you may think? huh?
    Paddington
    3rd Jul 2019
    2:27pm
    Adrianus, I have said it before but here goes again.
    My brother worked the pre polls in Qld. People believed all the Palmer spin to such a degree they were losing franking credits when they had none lol. Grandma won’t be able to buy gifts this year or ever actually. He was forever explaining what was because people were convinced by the signs all over the place.
    Directions were given like turn at the third or fourth Palmer sign. It was relentless.
    Not everyone is educated or savvy re politics so it was unfair.
    Adrianus
    3rd Jul 2019
    4:28pm
    Paddo, I would be very surprised to find someone who receives franking credits who wouldn't know what they are. That argument is illogical.
    Misty
    3rd Jul 2019
    5:56pm
    It was Clive Palmer and the so called Retiree Tax that did Labor in, also their electric car debacle didn't help and sorry to say Adrianus some people didn't even know there was an election on when interviewed, or who their local member was, sad isn't it that people are so disinterested in who is running our country, after all it is their future that is at stake as well as the country as a whole.
    GeorgeM
    5th Jul 2019
    12:14am
    I agree, wg, Labor are fully responsible for their defeat with their extreme policies. In addition to the points you have made, they also got millions offside with their radical climate change actions (un-costed for their impact on economy and individuals) and their radical gender agendas. They made themselves unelectable, and still show no signs of understanding that they need to represent labour & the people in general, not the rich.
    Misty
    5th Jul 2019
    9:51am
    I see OGR is back under another title again.
    Farside
    5th Jul 2019
    11:08am
    quite the detective work Misty but OGR was not alone in loving the caps lock key and then there is the more tempered language ... Rainey, say it is not so.
    Misty
    5th Jul 2019
    10:48pm
    Farside as I said elsewhere on this site, whinging grandma, Older and Wiser , Only Genuine Rainey are obviously the one person, the whole tone of her/his comments are a dead giveaway.
    Anonymous
    7th Jul 2019
    5:41pm
    “You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

    What one person receives without working for, another person must work for without receiving.

    The government cannot give to anybody anything that the government does not first take from somebody else.

    When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is the beginning of the end of any nation..

    You cannot multiply wealth by dividing it.”
    Tricky
    3rd Jul 2019
    1:28pm
    What about deeming rates or is that being held up in a prayer meeting!
    KSS
    3rd Jul 2019
    1:39pm
    First thigs first. Tax rates were an election promise, deeming rates were not!
    Triss
    3rd Jul 2019
    9:00pm
    First things first think how much extra money politicians will get from the tax cuts.
    Farside
    4th Jul 2019
    1:21am
    The tax cuts are a drop in the bucket in terms of an MP's total earnings and allowances. Most would not even notice the extra coin in the bank account.
    GeorgeM
    5th Jul 2019
    12:21am
    Misinformation from Farside again, as in the 3rd stage, ALL Federal MPs will get $11,640 tax cuts on their $207K+ salaries - certainly NOT a drop in the bucket. Clearly you are an ex-politician to support that self-serving breed, or have relatives in that game. Greed saw the 3rd stage tax cuts through the parliament, as that money would have been spent far better instead on infrastructure and reversal of pension cuts as they have too much money now rather than the budget emergency claimed a few years ago.
    Farside
    5th Jul 2019
    11:23am
    George, you really should take a chill pill and put your thinking cap on before commenting. If you read my other comments you would see that like you I also would preferred to see investment in productive infrastructure. I also agreed with your previous comments relating to reversal of the 2017 cuts to the means test thresholds due to there being no budget emergency.

    The future $11K cut to their personal income tax is inconsequential for the pollies going forward. They are motivated to get into the game for reasons other than an extra $11k per year. They already receive plenty by way of salaries, super, allowances, benefits, deductions, perks and expenses picked by others. A little more is neither here nor there for them.

    And AFAIK neither I or my relatives have ever been in politics in the past century. I don't think greed had anything to do with the third stage tax cuts; these passed due to what I consider misguided ideology and the LNP commitment to an election undertaking.
    GeorgeM
    6th Jul 2019
    12:59pm
    What an arrogant comment from a self-professed know-all, Farside! I don't spend my life reading all YLC comments so I can't say what you believe in or what you don't. However, my thinking is crystal clear and when I see silly comments I call them out - I believe in calling a spade a spade, in case you don't like the feedback. Get used to it.

    It is absolutely the case that Greed is Good in Canberra, and I predicted it soon after the 2019 Budget that the 3rd stage $11,640 tax cuts will pass as ALL our Federal MPs will get it. They are getting this on top of the minimum 2% pay rises they get every year in spite of low inflation, on their massive $207K+ Base Salaries for backbenchers.

    As the Libs only had this one policy for the election, maybe they can all pack up and go back home to look after their electorates, other than Ministers who have to manage their departments. Ideally, they should all have their salaries reduced now to Average Wage as they have noting more left to deliver as per their agenda.

    We Retirees ALL have a duty to vote OUT these self-serving leeches (as many of them as possible that the Retirees being 20% of the electorate can deliver) at the next election - so that they DO NOT get their hands on the loot they have just arranged for themselves. So, don't justify anything for them.
    Farside
    3rd Jul 2019
    2:16pm
    and what will happen to the $1080 refunds ... spenders will indirectly send bulk of it to China, South Korea or somewhere else offshore, while savers will use it to reduce mortgages or put it in the bank. Not more of a stimulus than Rudd giving out money largely spent on tvs and whitegoods. No wonder Gerry Harvey loves these guys.
    Sundays
    3rd Jul 2019
    2:31pm
    Yes, and the big boost to retail sales last weekend for end of financial year, was likely those buying in anticipation of their tax refund.
    MICK
    3rd Jul 2019
    3:09pm
    Lies, lies and more lies from the Treasurer of a known dishonest government.
    We have debt. The bottom and middle are becoming destitute and the top have never had it so good.
    "Tax Cuts" will be mostly soaked up by the rich. That is the intention! It will do almost nothing to stimulate the economy and it will add loads to our debt. The government trolls will of course ignore all as they spin their normal BS staraight from party HQ.
    Not a Bludger
    3rd Jul 2019
    6:22pm
    What a load of old cobblers!
    Old Geezer
    3rd Jul 2019
    7:19pm
    Complete rubbish Mick.
    Triss
    3rd Jul 2019
    9:04pm
    Give the Morrison honeymoon time, I reckon Mick will turn out to be right.
    MICK
    7th Jul 2019
    9:08am
    Bludger and OG? Known government sympathisers and likely spokesmen for same.
    Stupidity is when you ignore the facts and the truth. RIP.
    Old Geezer
    3rd Jul 2019
    7:18pm
    ATO is telling people not to lodge their returns until ithey send them an email that they can. So it would be foolish to lodge your return early.
    Manne
    3rd Jul 2019
    8:38pm
    Capitalism is becoming extreme. When I was earning $60k tax was 42%. Intrest rates were around 10 to 12%. .
    Misty
    3rd Jul 2019
    8:57pm
    Those were the days, never to return.
    Manne
    3rd Jul 2019
    8:59pm
    The countries with the highest taxes have the highest standard of living in the world. Where are we going here ? Rich get richer, poor get poorer. In my working time we paid the highest taxes and now we are getting screwed in our retirement with low interest rates. Asset test levels changing, no grandfather ruling, super changes , dependant on the share market etc... while federal public servants and politians are on the gravy train. Man I am pissed off!!!
    older&wiser
    4th Jul 2019
    9:36am
    I agree with you Manne. NO such thing as planning for your retirement. Every time you think you have made the right decision, the govt goes and stuffs it up by changing the rules. ALL the bloody time!
    And having had the extreme misfortune to work (actually, more accurately it was called 'being a slave') for an MP, believe me, I have NEVER seen such waste, such self interest and greed, and never paying for anything if you can claim it. Totally disgusted me, and constantly having to blatantly lie to constituents. Morally and ethically, I could not tolerate it, I was appalled and disgusted by what I saw. It really is like a pig with their snout in the trough.. greedy little pigs, with not a single iota of interest in anything that does not benefit themselves first. As long s they are protecting their own self interest and golden handshake, everybody else comes second. No - sorry - make that, last. Worst job I had EVER had in over 48 years of work.
    Hawkeye
    4th Jul 2019
    1:10pm
    Manne.

    I am a retired federal public servant.

    Like many others, I struggled (on a single income of less than the average wage) to pay off two mortgages, and support and raise a family.

    I paid my taxes (no bulls__t tax deductions for public servants when the tax-man is your pay-master) and paid my mandatory PSS super contributions of 6% on top of the legislated super that everyone else pays.

    Had to uproot the family mid-life to follow my very specialised job when it was re-located interstate to "increase efficiency", leaving us with a house we couldn't afford to sell plus the need for another one to live in, hence the two mortgages. Over 27 years we just about broke even on the great Australian get-rich dream of having an investment property (but at least it did give us a couple of tax lurks)

    No fancy holidays or travel or luxuries were affordable because if anything was left over it was used pay off debt.

    No big lump sum when I retired early, damaged by bosses who were trained bullies masquerading as army officers. After paying off debts, took the rest of my meagre super as pension in order to survive. I'm hoping for a part-pension late next year, but scomo will probably cheat me out of that.

    So man am I pissed off with people like you!!!

    Please tell me where the gravy train stops next, because I didn't realise I was on it.
    And if this is what life is like on the gravy train, please let me off.
    Adrianus
    4th Jul 2019
    1:20pm
    Absolute garbage Hawkeye. The salary packaging arrangements for those in PS are outrageous.
    Anonymous
    5th Jul 2019
    7:59am
    Those who benefit from them take them for granted, Adrianus. They simply don't know what hardship is. If they aren't as well off as the guy in the next office, they must be doing it tough. I know a few who are on easy street but do nothing but whinge and whine and tell everyone how hard they have it with their secure public service pension.
    Misty
    5th Jul 2019
    12:13pm
    The son of a friend of mine has just got a job with a Federal Poliotician, never been to uni or any special qualifications other then to have travelled widedly due to one of his interests, he gets $140,000.00 yearly salary, aged 20, don't know what other benefits he gets with the job as well though.
    Hawkeye
    6th Jul 2019
    4:03am
    So you would know all about APS salaries would you Adrianus.

    I just looked up what my salary would be if I was still working.
    $72531 which is far below the current Australian average salary of $82,436.
    And the vast majority of APS employees are on similar or lower salaries than that.

    And for that salary my career was spent physically testing, abusing, evaluating, and investigating defects in military explosives.
    All to make sure they were safe enough and foolproof enough for our big brave (and much higher paid) soldiers and sailors to use without killing themselves.
    Not quite your cusshy office pen-pusher job.
    But at least I still have all my fingers, although not much hearing.

    Trouble with people like you is that you only look at the top end of the salary range and stupidly believe every employee gets paid that much.
    That's as stupid as thinking a cleaner employed by, say, Gerry Harvey gets the same pay as Gerry Harvey.
    cupoftea
    4th Jul 2019
    10:26am
    In2sunset at least you had the b---- to stand up and be counted
    cupoftea
    4th Jul 2019
    10:26am
    In2sunset at least you had the b---- to stand up and be counted
    Beemee
    4th Jul 2019
    12:26pm
    What a lot of crock! Those who need it the most aren't getting it. ALL UNDER $100K should get huge benefits in tax reduction. Those on $200K are spending at a rate where they are acting as if on a champagne wage and spending accordingly.
    Thanks to old Lambie, she has sold out all of the pensioners, the lower income earners, disability pensioners, dole, newstart. And whosoever else can be added.
    Adrianus
    4th Jul 2019
    1:14pm
    HA HA HA!!
    Beemee, are you saying the high wage earners are living like bums because they are srooges and those on $100k are living the life of Riley?
    Beemee
    4th Jul 2019
    1:33pm
    Adrianus you are missing the point. If those on $200K need help, they are wasted space on this planet. Try damn $36,296 per annum. Then you have something to whine about. I wouldn't mind $200K, I would bank 75% of it.
    GeorgeM
    5th Jul 2019
    12:31am
    Lambie and Centre Alliance have combined to let the 3rd stage tax cuts through purely due to their self-serving greed for the $11,640 tax cuts they will all receive from 2024.
    Note that Labor also voted for it in the Lower House for the same reason - greed! If they were serious in their feigned objections, they should have campaigned much harder by highlighting the massive and unjustifiable $11,640 tax cuts to all on $200K and above but didn't. They also did not put any serious obstacles in the way by extending discussions, proposing amendments to delete the 3rd stage, etc. Greed is good in Parliament!
    Anonymous
    7th Jul 2019
    5:37pm
    there is no other country that I would want to retire too...I think retirees in the main are well looked after...not perfect but a darn sight better than say living in Venezuala!!
    Adrianus
    8th Jul 2019
    4:19pm
    Beemee, if your wage was $200k then good luck trying to bank 75% of that LOL. The tax office would take 25% for starters.
    Adrianus
    8th Jul 2019
    4:19pm
    Beemee, if your wage was $200k then good luck trying to bank 75% of that LOL. The tax office would take 25% for starters.
    KB
    4th Jul 2019
    1:18pm
    Labor did support the tax cuts for the first stage a after reviewing the whole scheme .This will not affect pensioners who rely on pensions,
    KB
    4th Jul 2019
    1:18pm
    Labor did support the tax cuts for the first stage a after reviewing the whole scheme .This will not affect pensioners who rely on pensions,
    Anonymous
    7th Jul 2019
    5:35pm
    ...and all pensions are paid for by taxpayers...so giving them tax relief is a good idea
    Beemee
    4th Jul 2019
    1:31pm
    Well if Lambie thinks she has stuck a bargain with Canberra jerks, think again. You should have got that agreement in writing you stupid woman. Scomo has lied through his back teeth all through the lead up of the election, so watch and see how much he honours the little people. He is all for the elite, because his 1/2 million annual pay would definitely put him in that!
    Nothing is to help the people at the bottom rung of the ladder.
    Stop digging a trench because of the flooding water, plug the dyke.
    I am fed up with all in Government, no matter what party, I am done with the lot. Dig a huge hole and bury that stupid white elephant building with all in it.
    GeorgeM
    5th Jul 2019
    12:37am
    She actually believed the Cormanator! Same guy who publicly supported, then dumped Turnbull!

    Have been saying here in YLC for a long time (maybe 2+ years), all retirees had to vote OUT BOTH major parties and the Greens current MPs by voting sensibly using preferences. Unfortunately, Retirees who consist of 20% of the electorate continue to sleep and are failing to understand their strength to bring about change.

    Retirees can still react to these massive tax cuts proposals before they come in in 2024 - by voting OUT all current MPs at the next election so that they don't benefit from the massive $11,640 tax cuts they voted for themselves.
    Beemee
    5th Jul 2019
    12:39pm
    I have a good idea to resolve all of our problems.
    Dig a huge hole beside that white elephant building in Canberra, add all the Ministers and all of those from each state inside, then push it in the hole and bury the bast**ds.
    Can I, Can I, Can I, pppplllease?
    Misty
    5th Jul 2019
    4:00pm
    If the 3rd part of the tax package ever gets through in the 2024-25 period the middle income bracket is scrapped and people earning $45,000,00 will pay the same tax as someone earning $2005,000.00.
    Misty
    8th Jul 2019
    12:50am
    The figures I quoted were from a website that gave the breakdown on what the new tax refunds are, check it out on News.com.au whinging grandma if you don't believe me.
    Adrianus
    8th Jul 2019
    10:40am
    Misty you're making up stories. Further, there is no substantial argument that I've heard which favours a strongly progressive tax on personal exertion income. We have lost many top highly trained, leaders in their field due in part because our tax system has conveyed the message 'that we don't want them in our country.' This LNP government has the correct approach to solving that problem despite the whinging from the envious minority. Folks lets get one thing clear, we compete with other economies on all levels. We need the worlds best scientists, Doctors etc to work for Australia? Besides by pushing up top marginal rates you provide more incentive for tax minimisation strategies such as negative gearing etc. and provide another issue for the negative, envious whingers. Vote for a flat tax and have only one single tax margin which is aligned with the poverty level. Why take tax from a worker earning $40,000 then return it in truckloads through welfare?
    Adrianus
    8th Jul 2019
    12:28pm
    A worker earning $45,000 will get an immediate reduction in tax by $891 meaning they will have a current tax bill of $6,029.
    During the 2024 year A worker earning $45,000 will pay only $5828 tax.
    In the same year a worker on $200,000 will pay $55,592.
    While a lucky bounder on an income of $2,005,000 will get a reduction of $138 and be liable for $915,447 tax.
    Misty
    8th Jul 2019
    12:49pm
    I am not making up stories Adrianus, only commenting on what I read on a website, have a go at News,com.au if you and WG think they are fairy stories.
    Adrianus
    8th Jul 2019
    2:44pm
    Misty Misty Misty, there are two possible explanations. You misread a headline? Now that would be believable when one considers all the crap in the print media, but what is not understandable is your lack of simple math and why you haven't provided a link to prove how you were taken in? Of course the other more plausible explanation as put forward by the whinging Granny is that you posted that crap, for political gain in the hope that nobody would call you out. All you have done is expose your mathematical genius to be the equal of your beloved Labor Party ministers. What happened to the old dear by the way? The old girl seems to have disappeared faster than a Labor budget surplus?
    Farside
    10th Jul 2019
    12:17pm
    you are not looking hard enough Adrianus if you are unaware of substantial arguments that favour progressive over proportional taxation. There are advocates and critics of both models and the answer leans more to social than economic benefits. A progressive model is fairer in theory while a proportional model is simpler; it all depends on they are implemented.

    If you want to learn more then try pretty much any writings of Nobel laureate Joseph Stiglitz. Start with the Price of Inequality but if that is too much then try this paper at http://rooseveltinstitute.org/wp-content/uploads/2016/03/Rewriting-the-Tax-Code-Report.pdf