Trying to work out the Coalition’s message is proving a job too hard, even for them.
Scott Morrison’s budget focus seems to prioritise income tax cuts, arguing that inflation and wage growth are pushing taxpayers into higher tax brackets.
But then Mathias Cormann reminds us that inflation is at record lows and wage growth is the slowest it has been for fifty years so bracket creep is “not there to the same extent as to what it might have been in the past.”
The finance minister said “that gives us a little bit of room to re-calibrate in a more affordable fashion our ambition in this area.”
Is that the sound of income tax cuts sliding off the table?
Then there is the GST which is definitely on or off the table depending to whom you listen.
Less than a week ago, Cabinet minister Michaelia Cash told Skynews that a 50 per cent rise in the GST was still on the table of tax proposals being considered.
“We haven’t taken it off the table completely, not at all,” the Employment Minister said on February 15.
The next day, Malcolm Turnbull said “I can assure you the government will not be taking a proposal to increase the GST to the election.”
What of negative gearing?
In July last year, Tony Abbott said “Another thing that we are not going to do, we are not going to fiddle with negative gearing because the last time a Labor government fiddled with negative gearing it destroyed the rental market in most of our major cities.”
But Joe Hockey, in his valedictory speech said “In particular, tax concessions on superannuation should be carefully pared back. In that framework, negative gearing should be skewed towards new housing so that there is an incentive to add to the housing stock rather than an incentive to speculate on existing property.”
After Labor announced just that, the new Treasurer weighed in criticising the efficacy of the Opposition’s plan to scrap negative gearing on established houses, arguing it will not help the budget bottom line as much as Labor is claiming it will.
“Like their famous mining tax, Labor’s proposed change to negative gearing promises big, but raises very little revenue,” Mr Morrison wrote in an opinion piece published in News Corp newspapers.
“It could also have some very nasty consequences for everyday mum and dad investors just trying to get ahead.”
Apparently, Morrison wants mum and dad investors to borrow lots of money to invest because that is the only way they can build their wealth. Unlike a government who cannot spend more than it earns and who should never borrow and who must live within their means. Private debt good, public debt bad.
But his focus on rewarding and protecting wealth creation is at odds with recent papers produced by the IMF which show that widening income inequality has become so bad in advanced economies that policymakers need to focus on “the poor and the middle class” if they want to boost economic growth globally.
It advised policymakers to reinforce their fiscal policies with “greater reliance on wealth and property taxes.”
It said reducing tax expenditures that benefit high-income groups the most, and removing tax relief – such as low taxation of capital gains – would “increase equity and allow a growth-enhancing cut in marginal labour income tax rates in some countries.”
Morrison has his new slogans all ready to go – they are the party for “jobs and growth”, Labor are for “tax and spend”. All we need to do is “work save and invest” and Scott will “back us in”… somehow.
And it is not only economics where the Coalition’s message is all over the shop.
In 2011, then Opposition immigration spokesman Scott Morrison said he was shocked by the treatment of refugees in Malaysia and that if we sent people there they would face the real prospect of being caned.
Mr Morrison reiterated a Coalition guarantee that asylum seekers sent to Nauru for processing would not be mistreated. But the prime minister could not do the same for Malaysia, he said.
Now we hear that the government is negotiating with Malaysia to take refugees from Manus and Nauru.
New Zealand has offered to take 150 refugees but the government says no because that would “put the sugar back on the table.”
Apparently our aim is to settle them somewhere inhospitable, preferably where caning is legal.
What of marriage equality?
We must have a plebiscite to allow the people to decide but we won’t be bound by their decision?
Then there is climate change.
Our current Prime Minister once said he would not lead a party that was not as committed to action on climate change as he was.
At the Paris climate change talks in December, he said “We do not doubt the implications of the science, or the scale of the challenge,” adding that the impacts of global warming will continue to be felt “even after we reach global net zero emissions” and that Australia is “not daunted by the challenge.”
Meanwhile, at a side event in Paris, Greg Hunt was challenged by a questioner about why the government had approved the Adani mine given the huge quantity of emissions its coal would create.
“This is not an Australian government project, it is a private sector firm from India and… I thought we were over neo-colonial moment where the wealthy decide what happens to the poor,” Hunt countered.
Turnbull said he has “great optimism and faith in humanity’s genius for invention” as Josh Frydenberg tells us that coal is the future that will save the world’s poor and Malcolm tells us that copper is fine and dandy for our future telecommunications needs.
Turnbull says that science and innovation are crucial to our future prosperity as they slash funding for education, try to increase the cost of tertiary education, decimate our premier research body, and use future research funding as a threat designed to gain compliance. Pure research will give way to research with quantifiable commercial potential, which apparently excludes climate studies.
Dealing with the Senate may be like herding cats, but Turnbull is trying to corral dinosaurs in an open paddock using his smile. They keep running off in different directions bellowing and sniffing for the trail.
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