Parliament imposes taxation, not the Executive

A strange comment in The Australian this morning:

Labor’s position on the $700 million a year in income tax cuts is base political hypocrisy.

These tax cuts were dumped by Julia Gillard and Wayne Swan in May last year on the eve of Labor’s last budget.

They had been intended as a second round of minor compensation next year under original plans for the carbon price to reach $29 a tonne.

But Labor said they were not needed as an expected 0.2 per cent rise in prices was not going to happen. Labor dropped the tax cut, booked the saving in its budget but never got around to doing the paper work.

Never got around to the paperwork? That’s the legislation – the law of the land.

Now I’m happy to believe that the government is a bit frustrated – but failing to cancel a scheduled tax cut and then bleating about it isn’t a good look for a government that has low taxes in its DNA – or something.

Here is the thing; the tax cuts were not dumped by Julia Gillard and Wayne Swan – like everything else that duo (and Rudd for that matter) got up to, they simply made an announcement and then expected things to happen by magic. Like they announced a budget surplus. Alternatively, they set up an ambush for an incoming Abbott government, leaving it with the odium of repealing a tax cut.

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26 Responses to Parliament imposes taxation, not the Executive

  1. entropy

    The ambushes were carefully thought out policies, like the $80 billion of hospital funding that would miraculously turn up one day when they weren’t in power, or the NDIS.
    This little example is just an expression of their incompetence. Ther are plenty examples where a Minister would agree to do something, promise such and such, then simply fail to tell their department to do it. So it would never happen. And as for cabinet processes, they were obviously held to rubber stamp what had already been agreed.
    So I side with incompetence.

    Minded you, the only reason this is an issue for Abbott and Hockey is that the gutless worms were looking for an easy way out with respect to finding Other Peoples’ Money as they were too gutless to look for real savings.

  2. Ellen of Tasmania

    they simply made an announcement and then expected things to happen by magic.

    It’s a very popular way of governing these days.

    I suppose that’s what happens when the state sees itself as God.

  3. stevem

    For the better part of a year prior to the election I believed the ALP were laying a minefield for an incoming Liberal government. The events since the election have only convinced me this is the case.

    By blocking everything in the senate they are sealing their own fate. Traditionally the ALP have handed out what I’ll call “social benefits” (things of all types that make people feel good). The Liberals have had to take the hard road and worry about financial responsibility. This has paved the way for the next Labor government and given them the funds to splash around.

    With no cash in the kitty next time they take office, Labor will have to knuckle down fiscally. The electorate will finally see the shallowness of the ALP.

  4. stackja

    Like they announced a budget surplus. Alternatively, they set up an ambush for an incoming Abbott government, leaving it with the odium of repealing a tax cut.

    MSM announced tax cut and gullible voters elected ALP/Greens again into the House. Along with obstructionist Senators.

  5. .

    Ask Kevin Rudd!

    He imposed excise taxation without the requisite legislation, was not sacked by the Viceroy and actually had Treasury keep the revenue.

    This country is busted.

  6. rebel with cause

    With no cash in the kitty next time they take office, Labor will have to knuckle down fiscally.

    If only. A lack of cash hasn’t stopped big spending government in the US or Europe so I’m not sure why it would here. The crush will come when we’ve run out of money and we can’t get a loan.

  7. H B Bear

    The crush will come when we’ve run out of money and we can’t get a loan.

    You mean like Gough? That’s exactly what it takes. Till then it is just spend, spend, spend.

  8. H B Bear

    Historians will argue for years to come about which category the R-G-R actions fall into: deliberate payoff to their union masters, incompetence or deliberate lies.

    Some are easy – Albo’s re-regulation of domestic shipping (straight payoff to the MUA), Ellis throwing billions at unionised childcare (United Voice). Almost everything done by KRudd and Swan was either incompetence and stupidity. The Goose will long remain the most intellectually limited individual to hold a senior ministerial position I am ever likely to see.

    Anyone done by Gillard, Conroy, Roxon or Plibers was a combination of lies, hard Left ideology and deciet.

    Maybe it isn’t that hard after all.

  9. .

    A lack of cash hasn’t stopped big spending government in the US or Europe so I’m not sure why it would here.

    I believe it has. Greece couldn’t get new loans.

    Salt the earth, scorch the countryside, pay off the debt and starve the beast.

  10. rebel with cause

    Greece couldn’t get new loans.

    We’re not Greece yet, but we are heading that way. That’s why out ‘tough’ budget is a deficit that actually increased spending.

  11. blogstrop

    Alternatively, they set up an ambush for an incoming Abbott government

    They sold the country down the river and should never be re-elected.

  12. Paridell

    Greece got new loans (the ‘bailouts’) many times over in the last six years, and it’s looking for more. But it only got them at the price of structural reforms such as closing down the state broadcaster, ERT. These reforms were imposed by the so-called Troika of the International Monetary Fund, the European Commission and the European Central Bank. In other words, the price for bailouts amounted to loss of sovereignty. The Greek government had to follow the orders of its lenders, regardless of what the Greek people or parliament had to say. The government justifies this by saying that it had to sacrifice democracy in order to save it.

    We need to get a grip on our finances a long time before we get to that stage. We have no Brussels or ECB to bail us out, sovereignty or no sovereignty.

  13. .

    The market wouldn’t lend to them. Like you said, they lost sovereignty to get more credit cards.

  14. Tim Neilson

    H B Bear
    #1380685, posted on July 14, 2014 at 4:14 pm
    I agree with everything you say with one qualification.
    You imply, by omission, that weapons grade stupidity wasn’t a driver of Plibershriek’s actions – surely she had that in spades?

  15. Tom

    I’m sure you have a different analysis, Sinc, but Phillip Hudson is one of my go-to analysts in Canberra because, like Simon Benson, he’s not lugging around a huge ego like Jabba the Hut, Paul Kelly or PVO (not to mention the fucktard activist lunatics of Fauxfacts). Hudson’s piece today, from which you have quoted, is one of the very best explanations for the insanity foisted on us by the half-mad opportunists in the Liars Party and the Senate:

    THE federal budget will never get close to being fixed if the Senate forces the government to spend money it doesn’t have on tax cuts and handouts it never promised.

    Amid all the Palmer drama last week and confusion about the carbon tax repeal, two big decisions were made that raise questions about whether non-government senators are going beyond any mandate they might have and if such actions make future campaign promises by the party that wins an election meaningless.

    It is one thing for the Senate to hold a government to account, or to take the rough edges off a policy, but it is wrong for the house of review to try to overthrow the government’s explicit mandate.

    The Senate has created an absurd position where it is forcing the government to deliver tax cuts Labor had abolished and keep payments that Tony Abbott repeatedly said he would axe.

    This is entirely different to the post-election decisions to impose a deficit tax on high-income earners, which breaks a promise not to increase taxes, or the $7 GP co-payment that was never mentioned before polling day.

    Labor’s position on the $700 million a year in income tax cuts is base political hypocrisy.

    These tax cuts were dumped by Julia Gillard and Wayne Swan in May last year on the eve of Labor’s last budget.

    They had been intended as a second round of minor compensation next year under original plans for the carbon price to reach $29 a tonne.

    But Labor said they were not needed as an expected 0.2 per cent rise in prices was not going to happen. Labor dropped the tax cut, booked the saving in its budget but never got around to doing the paper work.

    Last week, when the Coalition sought to put through the legislation to clean this up, Labor suddenly voted to keep the tax cuts, saying they would protect low- and middle-income families from spending cuts. It joined with the Greens and the crossbench to punch another $2 billion hole in the budget over three years.

    The tax cuts are worth $1.59 a week to people earning between $25,000 and $65,000. For those on $70,000, there’s an extra $1.21 a week, while people earning more than $80,000 receive 25c a week.

    What game is Labor playing? Its election costings assumed the tax cut was abolished and it now offers no saving elsewhere to pay for it.

    The government is being forced to spend money it doesn’t have to deliver a promise it never made that was dropped by a former government 14 months ago.

    Money bills can’t originate in the Senate but the upper house is also using a tax cut to compensate people for something that isn’t going to happen as compensation for a set of spending cuts that are being blocked.

  16. Rob MW

    Dot,

    David has a very good opinion piece up on ‘farmonline’ – A tax by any other name – delving into the very corruptible and obnoxious levy system that the Nat’s and peak farm body’s use to command and control the primary production sector.

  17. Andrew

    Labor’s policy backflip is inexcusable. If there was a meeja in this country this cynical stunt would get as much coverage as the fictional wall-punch. Fact is, it was not in the forward estimates – the Libs are entitled to rely on the 2013 budget policies.

  18. .

    LOL

    Rog is trolling David L on The Land website!

    Have these levies ever been challenged constitutionally?

  19. Rob MW

    Dot,

    LOL – yeh…….a bit friendly.

    No, not to my knowledge. They are all collected under the customs & excise provisions so I’d guess that there is not a problem with validity.

  20. Tel

    The crush will come when we’ve run out of money and we can’t get a loan.

    Not quite correct old chum. The money printing will come when we’ve run out of money and we can’t get a loan. Only when the money printing also fails will it start to dawn there might be a problem.

  21. Tel

    I believe it has. Greece couldn’t get new loans.

    First point, Greece does not have open slather to print Euros, if they did there would be a whole lot more Euros right now. Secondly, I think they still are lending to Greece. Their government is running a deficit and has run deficits every year for more than two decades:

    http://www.tradingeconomics.com/greece/government-budget

    Someone has to be lending in order that the keep borrowing, right? I mean, that would be the accounting I’m familiar with. Let me just repeat, there has been no “austerity” in Greece. The government has never lived within its means in recent history.

  22. Paridell

    Commercial lenders fell over themselves to lend to Greece after it joined the euro. The easy money only aggravated the endemic problems in the Greek economy. Crisis and haircuts all round followed.

    They didn’t learn their lesson even from that experience. They’re creeping back, lured by the “global hunt for yield” and “light at the end of the tunnel”.

    And that’s in spite of public sector debt remaining at 180 per cent of GDP!

    It’s times like these that you remember the Greeks invented both comedy and tragedy.

  23. Squirrel

    I am more inclined to support the conspiracy theory on this one – surely if it was publicly announced by the then PM and Treasurer, officials would have put together the necessary legislative amendments, unless told not to by the then Government.

  24. The facts are immaterial when it’s all about Free Stuff.

  25. .

    Paridell
    #1381370, posted on July 14, 2014 at 9:40 pm
    Commercial lenders fell over themselves to lend to Greece after it joined the euro.

    Yes well but I never argued otherwise.

  26. AndrewWA

    Continues to prove that Julia and KRudd were all about “seeming”.

    Announcement here, announcement there but everything they touched either never happened, was grossly over-priced, wasn’t needed in the first place or was just to fill the pockets of one union or another.

    Incompetent, economic vandals.

    The really sad aspect is that 56% of Aussies polled would vote to return Labor.

    Stupid is what stupid does……

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