The Palmer United Party (PUP) is proving to be a major thorn in the side of Abbott Government, today vowing to oppose the Government’s repeal of Labor’s carbon tax compensation – a move that will punch another $700 million hole in the Federal Budget, according to The AFR.
The former Labor Government had legislated to raise the tax-free threshold from $18,200 to $19,400 as compensation for the carbon tax, but with the tax repealed, the Coalition had deemed that compensation was no longer needed and intended to repeal the measure in parliament.
It is understood that the Liberal Democratic Party’s David Leyonhjelm and Family First’s Bob Day have also committed to opposing the repeal of the compensation measures, which along with PUP means that it will be implemented as scheduled by Labor.
While the tax cuts will prove a winner for lower income earners, in particular, they are yet another blow to the Budget, which is already facing an $11 billion hole from Labor and the Greens’ opposition to 20 of 32 Budget savings measures.
As argued yesterday, the opposition parties continue to ignore the very real structural pressures facing the Budget from falling commodity prices and an ageing population, and need to begin offering up credit alternatives to cut expenditure and/or raise taxes.
