2016 Budget A Missed Opportunity, Fails To Address The Big Issues

 

The Australian Taxpayers’ Alliance, a non-partisan advocacy group representing taxpayers, released the following statement on the 2016-17 Commonwealth Budget:

“Despite grand rhetoric, the 2016-17 budget is a timid, low-risk budget that fails to address the fundamental challenges facing the Australian economy, and represents a missed opportunity for the Turnbull Government” said Tim Andrews, Executive Director of the Australian Taxpayers’ Alliance.

“While Australian taxpayers welcome the relief given of both some personal income and corporate taxes, these are too little, too late and overshadowed by a number of damaging tax hikes. Overall this budget is just more of the same – more spending, more deficits, more bracket creep and more taxes.

“The FY 2016-17 Commonwealth budget reveals gross government debt to be an incredible $499 billion dollars – over $40,000 a household. Every year every family is paying over $1300 just in interest payments alone totalling $16 billion yet. Despite rhetoric from the Treasurer, both revenue and expenditure have increased in raw terms and as a percentage of GDP and this budget has failed comprehensively in dealing with runaway spending through any long-term structural reforms.

“Australia’s corporate tax rate, one of the highest in the world, continues to hold our economy back. While we welcome the government’s commitments to reduce the corporate tax burden, a ten-year implementation period to reduce the corporate tax is simply laughable. If the government was serious about tax reform, they would legislate for a reduction over 3 years - at most.  Furthermore, tweaking the 80,000 marginal tax rate to $87,000 fails to provide adequate relief to the millions of taxpayers struggling with the effects of bracket creep and continues the lazy strategy of “bracket creeping to surplus. Between 2012-18 bracket creep would have raised $16.7 billion dollars, and tweaking one marginal tax rate fails completely to deal with this.

“The introduction of the populist “Google Tax” is a further dangerous move that will send a strong international signal that Australia remains a high-taxing country that does not welcome investment and innovation, while raising very little. Similarly, further tax hikes on superannuation are a poor substitute for actual reform of our retirement payments.

“A further grubby tax grab in this budget is the decision to implement four further rounds of tobacco taxes. Our taxes are already amongst the highest in the world, disproportionately hurting low income earners. This regressive tax will result in an average smoker paying a massive $7,500 a year in tobacco taxes. Smokers already pay over 10 times their healthcare costs in tobacco excise. To keep treating this group as a cash cow to pay for wasteful spending is profoundly immoral and unjust”

“When becoming Prime Minister, Malcolm Turnbull promised to govern with liberal principles and restore the Government’s economic credibility. Sadly, this budget demonstrates that he has failed in this task.”

 

MEDIA CONTACT:

Tim Andrews, Executive Director, Australian Taxpayers’ Alliance
(m) 0434064934
(e) tandrews@taxpayers.org.au
(w) www.taxpayers.org.au

 

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