Tax cuts overwhelmed by bracket creep and revenue increases - The Centre for Independent Studies
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Tax cuts overwhelmed by bracket creep and revenue increases

The budget is inching closer to balance, but the government is taking a dollar and giving taxpayers back 20 cents says CIS Research Manager and budget expert Simon Cowan

“The turnaround from a $33 billion cash deficit in 2016-17 to a $2.2 billion surplus in 2019-20 is completely driven by a near $100 billion increase in revenue over the same period,” Cowan says.
“Spending actually increases as a percentage of GDP this financial year and next, before it starts to fall again.
“Individuals are paying an extra $24 billion in income tax in 2018-19 than they were in 2016-17 and will be paying an additional $45 billion on top of that by 2021-22, despite the tax cuts.”
“By contrast the government’s tax package, together with its abandoned Medicare levy increase, will only return $9 billion a year to taxpayers … not nearly enough.
“Meanwhile company tax receipts will increase by 30% between 2016-17 and 2018-19 and this proves the argument that companies aren’t ‘paying their fair shar’e is utterly false.
However, he says there is some good news. “At least the government is taking the CIS advice to increase the $37,000 tax threshold to above $40,000, even if it won’t take effect until 2022.”
Simon Cowan is Research Manager at the Centre for Independent Studies and is available for comment on the budget. He can be contacted on 0449 757 912