‘About bloody time!’: PM’s tax cuts relief shows ‘strategic nous’

Matthew Plumb writes: I understand the sentiment in this article (“Albanese’s broken tax promise fires the gun on the next election campaign”) but I strongly disagree with the conclusion.

Yes, the Libs will be screaming “broken promises!” until the end of time (or their next election victory, whichever is sooner — let’s hope the former). And their allies in the media — as in all but Crikey, the ABC, SBS and Guardian Australia — will happily do whatever is needed to ensure that message is amplified.

But I think Labor’s strategic nous has been underestimated here. The public, according to polling over the past six to 12 months, has come around to understanding how bad the stage three tax cuts policy is, and largely supports its amendment or repeal. I don’t think Australians will bite on the LNP campaign; most of those likely to get riled up were never going to vote Labor anyway.

I think Prime Minister Anthony Albanese, Treasurer Jim Chalmers and the ALP have laid a clever trap. “We’ve given more money to everyone who’s doing it tough,” I reckon their plan goes. “Those opposite still want to funnel billions to the top end of town during a cost-of-living crisis.”

Sue James writes: Perhaps if the media paid more attention to the sensible conclusion — because the economic situation has significantly changed, a change in policy might be required — and less attention to the “Oh look, it’s another dogfight” aspects of politics, good policy might actually be good politics. But the media insist on making the most of the clickbait “broken promise” comments by those who do not care one whit whether a policy is good for the majority of the country or not.

Labor’s mistake was agreeing to the stage three tax cuts in the first place, not changing them now we’re in very different circumstances.

Has anyone considered that one of the main reasons voters are “jaded and alienated” from politics is not because politicians change policy when it is required, but because they so rarely act in the best interests of the country, and so frequently in the best interests of themselves and their donors?

Keane’s take on the situation is a classic and disappointing example of why the public is almost as disappointed in the media as it is in politicians.

Kerry Grant writes: About bloody time!

Robert Kerr writes: What Bernard Keane has not considered is the demographic change in the populace and the subsequent attitudinal change, especially in the female vote. (Editor’s note: Keane wrote this two days later: “How Labor’s stage three tax cuts flip will benefit women more”.)

Peter Barry writes: The painful and electorally fraught decision to modify the stage three tax cuts is sensible. It gives more tax relief to lower-income workers while still giving substantial benefits to the upper echelons. Doing the right thing based on current circumstances should take preference over decisions made for purely political reasons many moons ago.

Yes, the opposition will have fun jeering and yelling betrayal, but will it undertake before the next election to reverse these changes if it regains power? It would be hypocritical of it not to.

Ray Armstrong writes: Albanese’s main concern is with breaking an election promise and being wedged by Opposition Leader Peter Dutton. But on the eve of the 2013 federal election, Tony Abbott promised no cuts to education, health, the ABC, SBS and no changes to pensions. He broke not only these promises but many more. The Coalition went on to win elections in 2013, 2016 and 2019. Quite clearly, breaking an election promise does not guarantee defeat at the ballot box.

Roger Collins writes: I would hope that when the situation and the facts change we should all be prepared to change our decisions. Inflation and cost of living have changed in magnitude and time span. It’s time to review and change earlier decisions — and promises. 

Sandra Bradley writes: I’m sorry, but I don’t understand the media hysteria over this. No promise has been broken — the stage three tax cuts are going to occur. It was always within the remit of whoever won government to formulate how those tax cuts would be managed based on the economy of the time.

Do the media really think Australians are that bloody stupid?

There’s so much more to worry about than a reconfiguration of stage three tax cuts, such as the devastation of yet another cyclone in Queensland, the extra 500,000 people brought in last year to help put even more pressure on housing, and the crazy sharemarket that can’t make up its mind whether it’s Arthur or Martha. Or maybe we could concentrate on the fact that we are in the midst of wars around the world.

Ben Rose writes: I think perhaps Keane is still suffering “great big tax on everything” PTSD and I really empathise. But most Australians are not so dumb as to swallow Dutton’s crap. Albanese just has to counter with words to the effect that “everyone will get a significant tax cut, especially those on lower incomes who have suffered from the inflation-induced soaring housing costs that have happened since the stage three cuts were legislated”. 

Donald Maclean writes: There are three legitimate points Keane downplayed. 

First, Albanese was always nuanced in his support for the Coalition’s stage three tax policy; when in opposition he supported it only because it was linked to stages one and two that were implemented soon after the package was legislated. He always said his position had never changed — and he still doesn’t like stage three as legislated, so why not amend it now to suit current conditions? Amending is not repealing. Some may see this as splitting hairs but it’s an important distinction.

Second, it was stupid to legislate tax five years in advance. We didn’t know how bad inflation, etc, would be.

Third, unlike Paul Keating’s “L-A-W Law” and Julia Gillard’s “carbon tax”, most taxpayers will get the hard smackeroos in their hands next financial year and will be reminded all the way to the polls they will get less if they elect Dutton in 2025. Dutton’s squawks will be seen for what they are and will link him to the “elites” he is now decrying.

George Korosy writes: Yes, the Labor commitment in opposition to support the third phase of the Coalition government’s proposed tax cuts was immature and risky. COVID and the war in Ukraine were not factored in. But when the facts change, is there any other rational course of action?

Jim Hanna writes: Labor had been in government for more than 10 years by the time Keating changed his “L-A-W law” tax cuts. Labor was on the way out regardless, especially after being reelected in 1993 to avoid John Hewson’s GST.

Albanese, on the other hand, is in his first term, albeit with a tiny margin. He will need to be a better salesman than he has proved to be so far if he’s to persuade enough voters that instead of breaking a promise he actually improved on it.

Ian Hampton writes: Albanese has done the right thing — it’s fairer and will help low- and middle-income earners who need a break.

But the lesson from the Indigenous Voice to Parliament referendum is that this will have to be sold in western Sydney and outer Melbourne — the rest of the electorate stick with its born-with political positions. It’s also important to court and persuade the teals and their supporters. Teals hanging on to those seats will be very important for a likely minority government…

John Bushell writes: The stage three tax law was a cynical time bomb planted by Scott Morrison and Josh Frydenberg, and with both now gone it is appropriate the time bomb is defused.

Apart from the cynicism of legislating a tax measure five years in advance to cause difficulty for a future government, the law was bad in its destructive impact on the progressive tax system and consequently the inherently adverse impact of inequality. Stage three was an attempt by the Liberals to benefit their well-heeled sponsors with little to no redeeming features.

Labor was inveigled into voting for stage three in Parliament because the cynical Liberal tacticians combined earlier stages with the disastrous stage three. Labor could not vote against stage three without voting down the stages one and two cuts to tax on lower incomes. The tax measures legislated by the Liberals were cynically combined to force Labor into a trap.

Undoubtedly Prime Minister Anthony Albanese was at fault for not saying much sooner that he opposed stage three. Albanese suffered criticism from progressively minded supporters for not repealing the legislation. Many felt they had elected a dud because Albanese embraced Liberal policies, avoiding reform.

People who had voted for a Labor government wanted to see policies that would see those who voted for Labor get rewards, via government policy, now. The modest changes to the stage three tax rates will benefit many middle-income earners who voted Labor. As well, the lower tax on the people the changes help preserve progressive rates in our system.

The opposition and fellow travellers in the media can beat their drums and gnash their teeth about “broken promises”, but the electorate will appreciate Labor producing Labor policies that benefit deserving constituents rather than the fat cats favoured by the Liberals.