Angus. Cannon. Foot. A match made in taxation debate heaven.
· Michael West
Among the many faux pas in Angus Taylor’s budget reply last month was his assertion that failing to index income tax thresholds to inflation was a form of ‘stealing’ from taxpayers. What’s the scam?
The scam is Angus didn’t do his homework. If he had, he would have learned that if his more numerate predecessors Howard and Costello had introduced automatic indexation 30 years ago, taxpayers would have been worse off, not better.
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According to an analysis by The Australia Institute, “An average worker is nearly $150 a week better off. Nurses, teachers and police are between $172 and $207 per week better off. Someone doing really well, earning double the average income, is $355 per week better off.”
This is because indexation removes the ability of Governments of any ilk to adjust tax settings according to the ebbs and flows of the economy and overall policy considerations, rather than relying on a rigorous indexation scheme.