New Government figures released this week show the Liberals will be relying on a massively increased tax take, rather than spending restraint, for any improvements in the mid-year Budget update.
The latest Consolidated Financial Statements show tax revenue increased by 10 per cent last year alone – a $38.9 billion increase from 2016-17 to 2017-18. (p. 9)
These latest figures back up further analysis of the Government’s own numbers, which show that –
- Of the $9 billion in unexpected improvements since the last Budget, two thirds have been further increases in tax;
- The Budget showed taxes almost $33 billion higher than forecast at the last MYEFO;
- In 2018-19 alone, the Government expected to rake in more than $8 billion in extra taxes while, at the same time, spending blew out by an additional $3 billion; and
- The Government is collecting more than $100 billion in tax this year than in 2013 ($340 billion in 2013-14 versus $440 billion in 2018-19), and the tax take will be almost $200 billion more ($520 billion) by the end of the forward estimates.
The Liberals can’t point to a suite of policies responsible for any improvement in the Budget position – it’s all automatic on the back of improved global conditions.
Any improvements in the mid-year update will be despite the Liberals and their chaos and dysfunction, not because of them.
The Budget would be in a far greater position were it not for the Liberals’ defence of unfair and unaffordable tax loopholes which overwhelmingly favour the top end of town at the expense of middle Australia, schools, hospitals and TAFEs.
Even with billions of dollars rolling through the door due to rosy global conditions, the Liberals have more than doubled net debt and gross debt has crashed through half-a-trillion dollars on their watch for the first time ever.
Labor has made the tough calls when it comes to fair Budget repair, which is why we’ve been able to commit to bigger surpluses over the forward estimates and substantially bigger surpluses over the medium term.
