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Workers’ surrender to tax cuts represents the price they pay to win power.Greg Jericho

NS Labor Party It seems that they have decided to reduce their policies to the few that they believe are politically advantageous for the next election.

In doing so, it cast support behind the most unfair tax cuts in Australia’s history, effectively ending the country’s progressive taxation.

Oh, what you do when you want to win too badly has forgotten why you want to win so badly.

this week ALP announces Abandoned negative gearing and capital gains tax policies (no real shock, not mentioned since the 2019 election), three statutory stages coming into force from 2024 to 25 He said he would support tax cuts.

Both decisions are bad policies in favor of the wealthy. However, the decision to support the third stage of tax cuts means that ALP now believes that increasing inequality is the price to pay if it wants to beat the government.

If you don’t reduce inequality, you might ask what is the point of the Progressive Party. To be honest, I don’t know at this point.

Obviously, ALP wants to fight the issue of corruption and corruption, to witness the announcement of the Federal Icac party on Monday, and the unsuccessful vaccine deployment.

It may work. Still, Australia is no longer equal.

It’s not good politics, so you don’t need it either.

Basically, the third step is to level the income tax rate for anyone who earns between $ 45,000 and $ 200,000 to 30%.

About eight years ago (just before Guardian Australia began), I wrote about the aging debate at the time when it was clear what it really brought about. With a flat income tax..

What was once the Liberal Party’s crank policy has since begun to be accepted by the Liberal Party. And the battle won on Monday with the atypical surrender of ALP:

If you don’t see the graph, click here

The reason this remains bad politics is because of who benefits. A $ 200,000 person will receive a tax cut of just over $ 9,000 a year, compared to $ 275 for a person with a median income of about $ 60,000.

If you don’t see the graph, click here

Sure, those who earn more will get a bigger nominal tax cut, but even in percentage terms, the tax cut remains terribly unfair, and if the party has wisdom, it will be politically rejected. Is easy.

The cut is actually made up of three parts. The first part is to reduce the marginal tax rate paid by people who earn between $ 45,000 and $ 120,000 from 32.5% to 30%.

This is most profitable for those who earn $ 120,000. Those who earn more than that amount will benefit from paying less tax on their first $ 120,000, but will be tax-reduced as they earn more.

This is the easiest part of the tax cuts to maintain for ALP. No tax cuts are needed, but politically it’s hard to fight, given that those who earn the median average income actually get a tax cut of about 1%.

But there is no excuse to support the second and third parts.

The second part is to reduce the marginal tax rate for people who earn between $ 120,000 and $ 180,000 from 37% to 30%.

This flattening of the rate does not bring any benefit to those who earn less than $ 120,000 and provides someone with $ 180,000 a 2.3% reduction. And that’s on top of the 1% reduction they already got from the 32.5% rate drop.

But the cut doesn’t end here. For those who earn between $ 180,000 and $ 200,000, the maximum marginal tax rate will be reduced from 45% to 30%.

If you don’t see the graph, click here

This will provide an additional 1.5% cut of $ 200,000 in addition to the 3% you already have in the other two stages.

Yes, this is currently an ALP policy.

Insanity.

But what about “desire”?

Consider two common professions (especially women): general nurses and elementary school teachers.

According to the Australian Taxation Office, the median income of nurses in 2018-19 was $ 69,391 and that of elementary school teachers was $ 73,730.

With a generous 2.5% annual salary increase, the median income of teachers will not reach $ 120,000 by 2038-39 and nurses will not reach it until 2040-41.

If you don’t see the graph, click here

People with a median taxable income of $ 59,9812 in 2018-19 will not get there until 2046-47.

Elementary school teachers are not expected to earn $ 180,000 up to 2055-56. At that point, I suspect that the desires had been separated for a long time.

In 2007, Kevin Rudd also imitated the Liberal Party’s tax cuts, but he skillfully opted out of top-end tax cuts and spent them on education. Today’s ALP should do the same and use it for something politically advantageous, such as geriatric care.

The third stage of tax cuts is a terrible policy, not even good politics, but unfortunately our future.

Workers’ surrender to tax cuts represents the price they pay to win power.Greg Jericho

Source link Workers’ surrender to tax cuts represents the price they pay to win power.Greg Jericho

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