While a lot of the political commentary is fixated on Labor's broken promise, will its backflip make the tax system better? On that, there's a lot less argument.

ANU economist Ben Phillips ran the government’s proposed stage 3 tweaks through his PolicyMod simulator to weigh up the winners and losers.

He finds about 6.2 million households will benefit from the Albanese government’s changes, while just 1.1 million households will lose out compared to the tax laws passed under the Coalition.

The government’s gamble is that nearly six-to-one winners to losers presents pretty good odds for the widespread financial benefits to outweigh the cost of a broken promise.

  • Zagorath
    9·
    11 months ago

    I actually think Labor has played this really cleverly. By changing Stage 3 in the way that they have, they maybe aren’t getting something quite as good as they would have if they’d been in charge of the tax system since 2018, but they’re massively improving it over what the LNP originally legislated. But—and here’s where I think the genius is—they can easily play it off to voters as not reneging on a promise. They didn’t revoke stage 3, they just tweaked it to be a little better. Genius politicking.

    • UnfortunateDoorHinge
      6·
      11 months ago

      Agreed. To most people, they’ve improved the cuts so that more people will get a cut. I would’ve got like $400, now I’m getting $1,400 off. I don’t see a problem in the government going “yeah you did want it, but it was pretty shit tbh so we made it better for you.”