Unlike most other energy exporters, Australia has failed miserably to collect any meaningful revenue from our burgeoning gas export industry, a situation likely to change soon. Global energy giants have never been more on the nose, particularly on the east coast where the onshore gas producers – who are not subject to the tax – last year created a community uproar over their pricing tactics and had to be brought to heel. Last October, he commissioned Treasury to take a deep dive into the inner workings of the Petroleum Resource Rent Tax (PRRT), an idea explored by the previous government.
He does, however, have an ace up his sleeve. ( ABC News: Adam Kennedy)īoth changes, however, run the risk of a political backlash and deliver only small returns. Soaring interest rates and locked-in spending commitments mean the government currently has little alternative but to look to the revenue side of the ledger. In the past few months he's tweaked superannuation tax benefits, and last week an idea was floated about changes to the generous discount on capital gains tax. He now has little alternative but to look to the revenue side of the ledger to close off tax loopholes that benefit only a small section of the population and look for areas where the tax system has failed.
That's left Treasurer Jim Chalmers in a pickle. Oh yeah, and don't forget the cost of the stage 3 tax cuts locked in by the Albanese government, which threaten to strip $243 billion in revenue from the coffers over the next decade. Pencil in a huge increase in defence spending in the coming decade, along with aged care and medical cost blowouts as a result of an ageing population, and the built-in funding shortfall is only set to worsen.
With interest rates now at their highest in more than 11 years, the biggest cost blowout in the national finances is our trillion-dollar debt. And before you blame COVID-19 stimulus for the mess, it's worth noting that even before the pandemic, our debt had doubled.
The national debt is now three times the size of that inherited by the Abbott government following the global financial crisis.
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