Australian Taxpayers’ Alliance Chief Economist John Humphreys says the stage three tax cuts would have “incentivised more investment” and the Albanese government’s changes will “gut the effectiveness” of productivity gains.
The Prime Minister unveiled the government’s new tax plan – after dumping the much-promised stage three tax cuts – in favour of directed assistance for low and middle-income earners.
“As we’ve long said, the last 20 years has seen nearly no meaningful microeconomic reform – the one exception was the stage three tax cuts, and especially getting rid of that 37 per cent bracket,” Mr Humphreys told Sky News Australia.
“That was a great idea – it actually would have incentivised more investment, more risk-taking.
“If you want more investment and you want more risk-taking, then you need to create a better reward for the investment … and that’s what lower marginal rates do … and that’s what we’ve taken away here, which is basically going to gut the effectiveness of productivity gains from stage three.”
