THE conga line of government ministers announcing broken promises continued yesterday when Greg Combet declared tax cuts foreshadowed as part of the carbon tax would not proceed in 2015.
As Climate Change Minister, Mr Combet clumsily tried to sell this as a positive for the government but the truth of the matter is, the carbon tax folly is unwinding and the residents of Australia will be left to foot the bill.
The “revision” of the tax cuts was necessary after the government significantly overestimated its revenues from the tax.
It is almost laughable that Mr Combet hailed the decision as a good one because “…This means it is a lower cost to our economy to cut pollution”.
The only problem with this latest decision is that a great deal of the revenue that the government coffers won’t be receiving has already been spent – leaving a significant problem for future governments whether Labor or Coalition.
The latest decision by the government follows earlier cutbacks including the ditching of additional payments to people in receipt of family tax benefit part A, which Treasurer Wayne Swan declared in last year’s budget as being “locked in”.
It’s not hard to understand why people have become increasingly cynical about a range of measures that will impact directly on their ability to make ends meet.
The additional Medicare levy for the National Disability Insurance Scheme (NDIS) comes straight out of the pocket of income earners, at the same time so-called “offsets” such as the tax break and the additional cash for those receiving family tax benefit part A are gone.
Add to that the additional energy costs being faced by every household through firstly, the carbon tax and then additionally by the GST applied to that tax, and it’s no wonder some families are struggling.
Tuesday’s decision by the Reserve Bank to cut interest rates will likely have little impact on the economy as people choose to either reduce their mortgages or save the cash to pay the increasing bills – and for retired, Australian’s they continue to watch the value of their nest egg decline.
We can only hope that most of the bad news has been leaked and next Tuesday night’s budget offers a glimmer of hope.
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