Add another policy to the list of hair-brained schemes birthed by a desperate PM, from The Australian:
Treasury has not modelled the dollar cost of the government’s 10-year plan to cut company tax, Malcolm Turnbull has revealed, saying an expert’s estimate of $55 billion over the decade “may or may not be correct”.
The Prime Minister aims to escalate the budget fight with Labor by using legislationto lock in a company tax cut in every year of the next decade, countering claims that the economic plan is only an “aspiration” and challenging Bill Shorten to vote for lower taxes.
However Mr Turnbull’s credibility was undermined by his admission today that “Treasury has not identified the dollar cost of that particular item”.
The Prime Minister insisted that, despite not having a dollar figure for the policy, it was “clearly affordable” because Treasury had projected a return to surplus in 2020-21.
More from the AFR:
The government has estimated how much its company tax deductions will cost over the next 10 years but does not want to divulge the number for two reasons:
First, a big number will fuel Labor’s campaign of the budget putting big business before families.
Secondly, Labor supports only a tiny increment of the cuts – giving businesses with a turnover of less than $2 million a company tax rate of 27.5 per cent. This will cost virtually nothing over 10 years, meaning Labor can bank almost $50 billion that the company tax cuts would have cost and spend it on its priorities. It will also neutralise government claims it has a $20 billion black hole in its 10 –year revenue estimates caused by a reassessment of how much a tobacco tax excise increase will raise over a decade.
On Thursday Prime Minster Malcolm Turnbull deflected repeated questions by Sky News anchor David Speers, over a $55 billion cost calculated by budget economist Chris Richardson but the
Finally, Mr Turnbull said Mr Richardson “may well be right” before adding “I’m not confirming or commenting on Chris Richardson. It may or may not be correct.”
As I’ve said before, I support company tax cuts at the right time and in the right way, as a part of a broad reform agenda aiming to lift the tax burden on productive effort. But this is complete madness. Do we have a prime minister that uses the executive to distill quality policy in the national interest or are we being ruled by a self-appointed Mad King that spends whatever he wants on whomever he wants for whatever reason he likes?
