Prime Minister Tony Abbott.
Prime Minister Tony Abbott. Vicki Wood

WE SAY: Tax repeal could dig us into a hole

OUR VIEW: THE Tony Abbott-led Opposition vowed it would repeal the mining tax if it won government. It won and the tax, with Senate amendments, is days from being repealed.

Treasurer Joe Hockey has hailed the agreement with the Palmer United Party and other Senate cross-benchers as a "damned good deal" for the Australian people, but on the face of it, it has few pluses for Australia - or indeed for the Abbott Government.

It is a promise fulfilled, yes, and thanks to the PUP, the Income Support Bonus and the Schoolkids Bonus will stay until the end of 2015.

The Gillard Government's workers' superannuation increases, from its current 9.5% to 12% by 2019, have been moved out to 2025, which could well become a year away from the 12th of Never.

And any benefit to small business the superannuation delay may have has been stymied by the reduction in allowable tax claims from $6000 to $1000.

But most tellingly, the repeal leaves a gaping hole in the budget - $6.5 billion - at a time when the government insists every penny counts.

Labor has argued that what Joe Hockey calls Australia's "budget emergency" is of the government's making.

The events of the past 36 hours only underline that assertion, and give the uneasy impression that axing the mining tax may cost us much more than we expect.


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