Australian Opposition Warned Over Tax War With Government

by Mary Swire, Tax-News.com, Hong Kong

07 August 2001

In what many Australians will undoubtedly feel was a timely reminder, Labor Party front-bencher Bob McMullen has warned that the opposition party risks alienating voters in the run-up to the general election if they get involved in a 'sterile tax auction' with the Howard government.

'The tax system is a minor part of the future of our country,' he told viewers of Network Seven viewers recently. 'Important, and governments have to get it right, but the key question is, where are the jobs for our kids?' He went on to add that in his opinion, the issues which were really preoccupying Australian citizens were research and development, new jobs and industries, health, and measures to improve the situation of the elderly.

As parliament resumes, neither of the major parties has officially announced many of their election policies in the area of tax. However, since the Aston by-election, there has been an ongoing (and increasingly tiresome) volley of jibes, insults, and accusations traded between the Labor and Conservative parties regarding the goverment's flagship Goods and Services Tax (GST) and the possibility of income tax cuts.Many feel that the debate has spiralled out of control, especially considering that the election is not planned until November or December of this year.

However, despite his official position as Aboriginal Affairs spokesman for the Labor Party, Mr McMullen clearly couldn't resist throwing his own hat into the tax ring and intimated that his party's proposed GST rollback would be easier to implement than Mr Howard's income tax cuts, as it could be introduced incrementally. 'To get any income tax cut costs a billion dollars for every cent you reduce the tax rate,' he observed. 'Whereas for a billion dollars, you can make a very big difference to the GST, so we have a much easier task, but we are not just focused on tax.'

Recommended