Alan Kohler: Prepare for a March election and then a horror budget in May

Alan Kohler election

The sting is not just in the scorpion’s tail but in its nature.

Since the election of the Whitlam government in 1972, the average tax to gross domestic product ratio during three Labor governments was 20.4 per cent while during the three terms of Coalition government it’s been 22.4 per cent. In other words, Australia’s highest-taxing party is the LNP, quite comfortably.

To be clear: The only reason the Coalition is able to say that it’s keeping the taxation to GDP ratio below 23.9 per cent is because it is running huge deficits.

It is budgeting to finance an average of 4 per cent government spending with bonds rather than tax.

That’s why next year’s budget will have to be brought down after the election rather than before it: They’ll have to get started on the spending and welfare cuts early, and such budgets are always best in the first term, just after an election.

Source: Alan Kohler: Prepare for a March election and then a horror budget in May

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