The deficit levy has been christened Abbott’s “Gillard moment” and the polls are not happy. From the AFR:
The complexities of imposing the surcharge without subjecting families earning between $80,000 and $125,000 a year to a double hit from higher taxes and lost family benefits mean the exact shape of the measure is not yet finalised.
However, Prime Minister Tony Abbott and Mr Hockey are believed to have locked themselves in last week to a strategy that includes a levy, despite a violent political backlash before budget details are even unveiled.
A Galaxy poll on the weekend showed 72 per cent of voters believe the proposed “deficit tax” represents a broken promise by Mr Abbott and plunging voter support for the government.
But a view in the government is that, since it is already feeling the political damage, it might as well proceed and will look weak if it does not.
Meanwhile, ReachTEL has Labor 54-46 on a two-party preferred basis.
It’s poor policy-making but not for the reasons being cited across the MSM, that it’s a broken promise. It’s bad because it was a short term levy designed to avoid the very broken promise argument that is dragging it down. The government has therefore spent political capital for next to no gain. It could still have broken the promise had it been genuine about making genuine tax reforms aimed at stabilsing the budget permanently, which would have given it the more substantial argument of acting in the long term national interest.
