A broken promise, yes, but Albanese did the right thing on tax cuts

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It used to be the Brits who had the market cornered on whinging, but I reckon Aussies give them a fairly good run for their money these days.
Who would complain about getting extra money in their pocket, for doing next to nothing?

The reaction to Anthony Albanese’s decision to alter stage three tax cuts, due to be implemented from later this year, has been extraordinary to watch unfold.

Yes, the Prime Minister has backed down on an election commitment to implement the stage three tax cuts as planned.

You could accept the outrage if his changes resulted in people not getting a tax cut at all or if they impacted our lowest paid workers significantly.

But quite the opposite is true. Under Albanese’s new plan, someone earning $40,000 per year will actually be $654 better off. If you’re earning between $45,000 and $135,000, you’re $804 better off.

Even if you’re earning $145,000 per year – a more than decent wage and significantly higher than the average Australian pay packet – you’re scoring $104 more than you were under the Morrison government’s initial plan.

It is only when you reach a $150,000 wage that you’re worse off under this plan. But worse off does not mean no cut and a re-working of your family budget. In fact, if you’re earning $150,000 per year you’re still getting a tax cut of $3,729.

Even someone on a $200,000 wage is scoring $4,529 in their pocket; albeit about half of what they would have got under the previous plan.
For the last year the cost-of-living crisis has dominated conversations in living rooms across the country.

We all know that people are doing it tough, whether it’s at the supermarket checkout, putting petrol in their car or paying the electricity bill.

Anthony Albanese.

And while I don’t subscribe to the theory that you should constantly target high income earners, it stands to reason that weathering the cost-of-living crisis is far tougher for someone earning $70,000 than it is for someone taking home $150,000.

So, the Prime Minister reacted. He’s come up with a plan that puts more money into the pockets of people who need it, and has essentially put people before politics.

Sure, you could mount an argument that regardless, it’s a broken election promise. You could go back and find the many times Albanese was interviewed during the election, and afterwards, and find gotcha quotes where he says the tax cuts would be implemented as planned.

But circumstances change. Peter Dutton should know that, given he was a senior Minister in the Morrison Government during the COVID pandemic, when plans and promises were thrown out the window to battle economic uncertainty.

Albanese has broken a promise here but it’s hard to argue that he wasn’t right to do so.

Though many are mounting that argument.

Andrew Clennell on Sky News, when pointing out the average income earner would score only $20 extra per week under the plan, asked Albanese last weekend: “Is that ‘lobster’ enough in the supermarket to allow people to forgive you for breaking an election promises?”

Let me tell you, for many struggling families at the moment, it absolutely is.

They’ll sleep much better at night knowing they were able to use that ‘lobster’ for much-needed groceries than they would knowing Albanese has kept a promise.

It is not Albanese’s promises that keep people up at night, it’s the amount of money sitting in their wallet or bank account.

We have to accept that Albanese’s original commitment was made when the economy looked a little different and when the cost-of-living crisis wasn’t as severe.

Certainly, those commitments were made long before interest rates went up month after month.

Should he have been more careful with his wording? Perhaps, but he would have been criticised for that, too.

Anthony Albanese.

I get the argument that Albanese’s credibility comes into the argument here. If he could break this promise, what’s next?

But an election is the greatest litmus test of all and one is only 18 months away.

I assure you, Labor won’t be losing an election based on giving people more money in their pocket, despite what the political analysts want us to believe.

He may have lost a few friends at the top end of town, but the majority of Australians will struggle to find fault here.

That’s not to say Albanese’s star hasn’t fallen significantly since he came to power and indeed, as I wrote last year, you can see a path where he finishes as a one-term Prime Minister.

But to suggest that would be on the back of this broken promise, and to suggest he was booed at the Australian Open Final on Sunday night because of tax cut changes, just isn’t a reflection of reality.

No, you should not always punish the big end of town when it comes to taxes and budgets. They play a crucial role in the economy.

But the best decision for right now is the one that Albanese has made.

To listen to what people are telling him on the ground, to get more money to those most impacted by the cost-of-living crisis, and to react when you need to despite what your critics may say.

Albo got this one right.

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