The Wrap with Ebony Bennett

What. A. Fortnight.

People told us it was impossible. But last week Prime Minister Anthony Albanese announced the Stage 3 tax cuts would be redesigned to make them fairer, redistributing $84 billion that was destined to go to the highest income earners back to people on low and middle incomes.

The changes will see the package deliver tax cuts to all taxpaying Australians Millions of people who would have received no benefit at all from the Stage 3 cuts will now receive one, during this cost-of-living crisis.

This week Richard Denniss debated Allegra Spender at the National Press Club on Stage 3, describing the changes to Stage 3 as “the biggest and most honest piece of tax reform in modern times.”

It is a huge win. While many organisations and people have worked towards this result, it is fair to say that over the past five years the Australia Institute has led the charge on the need to redesign Stage 3, but we didn’t do it alone.

Without your support, our research would be gathering dust on a shelf. Instead it’s reshaping the nation.

Whether you donated to our research, attended one of our Revenue Summits, shared our reports or video explainers or just liked or retweeted our content on social media – you played a part in changing Stage 3 for the better.

Thirty years after the Australia Institute first opened its doors in 1994, it is clear our research drives real policy change for the better.  

— Ebony Bennett, Deputy Director of the Australia Institute

The Big Stories

Richard Denniss at the National Press Club

Richard addressed the National Press Club on Wednesday 31 January, debating Allegra Spender MP on the Stage 3 tax cuts and tax reform in Australia.

“Anthony Albanese’s decision to recast Scott Morrison’s 2018 Stage 3 tax cuts to suit the economy of 2024 is the biggest and most honest piece of tax reform in modern times.”

Read the full speech and watch the address: Richard Denniss: National Press Club Address

In front of packed crowd, Richard addressed the urgent need for tax reform in Australia and provided four steps to effective change.

1. Do no harm: tax things we want less of, subsidise what we want more of.
2. Do the simple things: improve our existing tax structures – like the PRRT to collect more revenue
3. Do the fair things: the market has to actively intervene in inequality
4. Think big: move away from privatisation and fund public and skilled sectors

Read the Key Takeaways from Richard’s Speech

"The Australian Government collects more money from HECS than it does from the Petroleum Resource Rent Tax.

"Thank you, children. You're the backbone of our economy, not the gas industry."

Executive Director Richard Denniss at @PressClubAust@RDNS_TAI #auspol pic.twitter.com/osD3SWF4wF

— Australia Institute (@TheAusInstitute) January 31, 2024

The response to Richard’s speech has been overwhelming, both online and on social media.

Here are some highlights:

• SBS News: Eat your heart out, mining. See how your HECS is the real ‘backbone of the economy’
• The Guardian: ‘That’s what grownups do’: changes to stage-three tax cuts a ‘good call’, says economist 
• New Daily: Majority support tax cuts for lower earners: poll
• The Mandarin: An honest debate about tax reform in Australia
• News.com.au: Allegra Spender says tax reform must be election priority in debate with Richard Denniss

Stage 3 Changes Mean Lower and Middle Income Earners Are $84 Billion Better Off

The Albanese Government’s redesign of the Morrison-era Stage 3 tax cuts is a win for equality and the economy. The cuts, due to come into effect in July 2024, were set to be the most expensive and inequitable tax cuts in Australia’s history.

Stage 3 would have fundamentally damaged Australia’s progressive tax system, removing the 37% tax bracket, leaving someone earning $45,000 a year paying the same marginal rate of tax as someone earning $200,000.

The importance of preventing this from happening and diverting billions from high-income earners to those battling the hardest during a cost-of-living crisis cannot be understated.

Over the past five years, the Australia Institute’s work has included research and analysis that changed the national conversation around Stage 3, highlighting the package’s inequity and fundamentally flawed design.

During October’s Revenue Summit, our proposal to restructure the Stage 3 tax cuts garnered national attention and demonstrated that even if the cuts could not be scrapped altogether, there was scope for them to be significantly improved.

Greg Jericho, the Australia Institute’s Chief Economist, has broken down the inequities of the Morrison-era tax cuts and how changes to Stage 3 make the package fairer.

Australia Institute research and commentary continues to drive this debate.

This week, we released research showing this week that half of Australia’s highest income earners on more than $200,000 back a redesign of Stage 3, and that two-thirds of voters think it is more important to adapt policy to changing economic circumstances, even if it means breaking an election promise, further underscoring the strength of this decision.

Here are some highlights:

• RN Breakfast with Patricia Karvelas: Redesigning the Stage 3 Tax Cuts
• ABC News: How the revised tax cuts affect people like you
• 9 News: Majority of Australians back scrapping Stage 3 tax cuts: poll

Make the System Fairer | Judy Horacek

All cartoons © Judy Horacek

An Executive Summary – Polly Hemming in The Monthly

In the latest edition of The Monthly, Polly Hemming, Director of the Australia Institute’s Climate & Energy Program explores how crucial it is to hold the public service accountable for the climate policies that facilitate fossil fuel expansion.

Polly’s article appears alongside an article by Attorney-General Mark Dreyfus.

The Attorney General’s essay describes the government’s commitment to integrity.

However, as Polly explains, the government’s approach to the climate and biodiversity crises reveals how shallow this commitment appears to be.

“A damning body of evidence documents how Australian politicians – with the help of senior public servants – have ignored the science, pandered to the resources industry, and sabotaged the ambition of other countries,” Polly writes.

The February edition of The Monthly is available now.

Big Questions About the Government’s Gas Deal

The federal government’s new deal with gas giants Woodside and Esso is being sold to us as cost-of-living relief.

But not only does it prop up the gas industry, it’ll probably make your gas bill more expensive.

Climate & Energy Principal Advisor Mark Ogge explains.

The federal Government’s new deal with gas giants Woodside and Esso is being sold to us as cost-of-living relief.

But not only does it prop up the gas industry, it’ll probably make your gas bill MORE expensive.

Climate & Energy Principal Advisor @MarkOgge explains. #auspol pic.twitter.com/WNfaKjSJNR

— Australia Institute (@TheAusInstitute) January 29, 2024

[Yet] Another New Coal Mine

In disappointing news last week, the NSW Government approved the Boggabri Mod 8 coal mine.

This mine is set to produce 56 million tonnes of coal and 156 million tonnes of emissions over its 10-year lifespan. We can’t afford any new coal mines, let alone one this enormous.

The Federal Environment Minister could reject this mine, along with the 29 others that have been proposed. If you haven’t already, sign our petition and share it with your networks to keep the pressure on the federal government.

Political Donations & Democratic Reforms

Parliament returns on Tuesday and this week saw the annual disclosure of political donations from the Australian Electoral Commission, covering the 2022-23 financial year.

As the Australia Institute’s Director of the Democracy & Accountability program, Bill Browne, told the media this week, flaws in the current system mean that some donations take over 18 months to be disclosed – if they are disclosed at all.

Read more from Bill in The Mandarin and news.com.au, or take a listen on The Wire.

Reforms to political donations are a key aspect of the Australia Institute’s report, 47th Parliament and the Democracy Agenda, released this week, which encourages parliamentarians and the government to consider how to improve integrity and democratic responsiveness.

An update of the agenda was released this week, finding that four of the recommendations have been implemented in full and another 14 implemented in part or otherwise progressed.

As Bill said this week, 2024 is the last chance for meaningful democratic reform ahead of the 2025 election:  “Australians should go to the next election with strict political donation disclosure laws, truth in political advertising laws in force and information about who’s meeting ministers made public as a matter of course.”

Podcasts

Follow the Money

Follow the Money
It’s been a week for the books in Australian political history, with Prime Minister Anthony Albanese announcing changes to the highly-criticised Stage 3 tax cuts. Which got the media, and the opposition, into a bit of a frenzy. So what’s changed, and how will it affect you?

Listen now: Stage 3 Tax Cuts reform: “The biggest and most honest piece of tax reform in decades”

Dollars & Sense

The latest CPI figures show inflation has fallen, hopefully putting an end to interest rate rises for the moment. But does that mean the economy is healthy now, or is there more to it?

Listen now: Inflation seems to be under control…what now?

The Quote

History will not look kindly on those complicit in facilitating a fossil fuel agenda even if they haven’t technically broken any laws.

— ‘An Executive Summary’ by Polly Hemming featured in The Monthly 

The Win

Stage 3 Breakthrough

The Albanese government has decided to redesign the Morrison-era Stage 3 tax cuts in a win for equality and the economy.

The changes will mean every tax payer will now get a tax cut, with $84 billion dollars delivered to low- and middle-income earners over the next ten years.

Changing the Stage 3 tax cuts has been at the forefront of the Australia Institute’s work for the past five years and the result dozens of reports, data analysis, research, videos, events, media appearances, petitions and emails by the Australia Institute since the cuts were announced.

The Bin

Victorian Duck Hunt Continues

Duck hunting in Victoria will be allowed to continue, with minor caveats, after the state government rejected the government’s inquiry calling to ban the practice.

Changes include mandatory training and testing for duck hunters, including Indigenous cultural awareness training and there will be changes to ammunition types, hunting times and the number of birds that can be taken.

Recreational duck hunting is banned in WA, NSW and QLD, but remains legal in Victoria, SA and Tasmania.

The Australia Institute made a submission to the inquiry arguing that duck hunting has a detrimental effect on the Australian ecosystem, and isn’t even that popular.

Read more: The Duck Stops Here: Economic Benefits from Vic Duck Shooting Ban

Listen: The Environmental Fight You Probably Haven’t Heard Of

What’s On

Transitioning to a Circular Economy  | Webinar: 11am Tuesday 13 February 2024

Australia’s Biggest Book Club | Webinar: 11am Thursday 29 February 2024

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