What the stage 3 tax cuts will mean for the economy | Ask an Economist

In this episode, Richard and Matt answer the question: "The Labor Party has announced they are dumping their proposed reforms of negative gearing and the capital gains tax discount, and they are now saying they will not repeal the stage 3 tax cuts. What will it mean for the economy?"

Welcome to Australia Institute's Ask an Economist -- with Matt Grudnoff, senior economist at the Australia Institute, and Richard Denniss, chief economist at the Australia Institute.

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[backinthegame]

“From the fact that people are very different it follows that, if we treat them equally, the result must be inequality in their actual position, and that the only way to place them in an equal position would be to treat them differently. Equality before the law and material equality are therefore not only different but are in conflict with each other; and we can achieve either one or the other, but not both at the same time”
― Friedrich August von Hayek, The Constitution Of Liberty

[beesplaining]

Conservative governments policies seem to come from their ideological beliefs of a hierarchy in society. High income earners and welfare recipients are absolute polar opposites in their ideological hierarchy of worthiness.

[asdfasdf]

I'm not sure what these two are smoking! America has capital gains tax to help the rich get richer, same goes for inheritance wealth, corporate profits and a few more.

[jamesbuijs]

Labor: I want to make Aus more equal by getting rid of the stage 3 tax cuts and changing the capital gains tax and negative gearing
Aus: nah that sounds like you will make us all poor i want to keep my money
Labor: fine we wont touch anything we will just find optimizations in the budget
Aus: you are being too weak, you dont stand for anything, why arent you looking out for the little guy, dont you know how much these tax cuts are costing the budget

Labor Can literally never win. Australia votes against them when they have big reforms and then when they vote them in because they said they wont have big reforms everyone complains that they aren't doing enough

[guaxary]

Could you do an episode on the Aussie fintech company being bought by an American giant? In all the media I read/watch it's being celebrated - but nobody talks about 1. how predatory, especially towards young and less educated, the whole idea of delayed payments is, 2. why losing a local business, paying taxes (at least some taxes) here is a good thing for the general public here. Shouldn't media, especially the public ones' talk about how much money is escaping our local economies when we use intermediaries to pay? Shouldn't be encouraged to create and support initiatives like Bristol Pay not to cheer some very few people getting extremely rich with no benefit for the rest of us?

[BarryMillard-br]

Give with one hand, take with the other 😮
Tax on liquor, tax on tobacco tax on all with GST.
A false system, that's why never believe a politician 🙏😊
All other taxes are paying for the tax breaks, so no tax breaks at all.
Just smoke and mirrors 🙏🙏

[kirsten]

It's difficult to talk about housing being part of a person's wealth. Given the rising unaffordability of housing, a person can own a million-dollar property and be paying off a huge loan to do so. To increase rates on those properties just makes homes even less affordable. Unless we have a housing policy that is directing people to live in apartments. But that complex question is about housing not about wealth.

[madonnawaugh]

We Need to tax all wealth generation that is not earned and that includes super. That is a profit gouging burden on the federal budget. Tax all labour less and tax any wealth that isn’t earned

[davidwilkie]

No change to the Casino policy then, in the Lucky Country. The House always Wins, and the Punters like to lose and keep the system "stable", just like every other country..

[SurmaSampo]

Well removing the capital gains incentive and exclusion on the family home would certainly bring down housing prices. There would be a lot of effectively underwater mortgages as a result.

It would also hit superannuation funds like what happened in 2008 as most super funds and all lenders have massive exposure in the residential real estate market.

People might get upset when the only commonly available wealth building option for middle income earners gets vapourised.

Any real change would by nessessity be generational as unfair as that may seem.

[gideonliversage]

How does TAX 3 cuts causes inequality again ? When hundred and thousands of hard working people will get the benefit. Life is not just about the "rich". Other people also exists that fall between 45 000 - and 200 000, and they will all see some benefit. You are all just peddle bullshit to the masses.