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Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)
Australians don’t appear to be upbeat about the Turnbull government’s victory in steering $144 billion of personal income tax cuts through federal parliament.
The weekly ANZ-Roy Morgan consumer confidence index released on Tuesday fell 0.6 per cent, adding to a 0.7 per cent drop in the previous week.
“It’s a little disappointing that the passage of the income tax cuts through parliament last week failed to boost expectations about future finances,” ANZ head of Australian economics David Plank said.
However, the confidence survey – a pointer to future retail spending – was taken at a time of a further easing in house prices and a spike in petrol prices in some capital cities.
Polling released at the weekend ahead of the July 28 federal by-elections in Mayo and Longman also suggested voters are hardly stampeding to the coalition following the tax cuts.
The seven-year tax package that was voted into law kicks off with a rise in the 32.5 per cent marginal tax rate threshold from July 1.
From the same date, a new low and middle-income tax offset worth up to $530 begins, although it won’t be paid out until taxpayers do their tax returns at the end of the 2018/19 financial year.
Other tax reductions won’t occur until 2022 and 2024 and tax cuts Labor has vowed to roll these back if it wins the next federal election.
Opposition Leader Bill Shorten told a conference Australians can’t just keep making these massive tax scale change promises without analysing where is the money coming from.
“I haven’t heard a satisfactory answer from the government,” he told a Committee for Economic Development of Australia conference in Canberra.
“Getting the parliament to vote on $144 billion on changes in tax scales and another $80 billion on corporate tax changes, where is that money going to come from?”