Anthony Albanese has avoided saying whether Australians will have to pay higher taxes in the near future as he conceded his government would have to make difficult decisions in the May budget.
Speaking at the National Press Club, the Prime Minister reiterated his government was facing a challenge in working out how to cover the ballooning costs of essential public services, including Defence and health care.
Mr Albanese wouldn’t answer directly when asked if Australians needed to accept the upcoming budget must include some policy decisions to increase tax revenue to make government programs more sustainable.
Nor did he rule out the possibility of tax increases in the future.
“We’ll continue to have a conversation with the Australian people about what’s needed going forward,” he said.
Prime Minister Anthony Albanese says the government will need to make difficult decisions. Picture: NCA NewsWire / Gary Ramage
Mr Albanese said increased spending on programs such as aged care and the National Disability Insurance Scheme, as well as higher interest rates on nearly $1 trillion worth of government debt, would mean some sacrifices.
“That means that we won’t be able to do everything that we would like to do. I can think of a number of measures that I would like to do,” he said.
“Last budget, let alone next budget, that is just not possible … to achieve all of that in a short period of time.”
Mr Albanese’s appearance at the National Press Club comes as Labor eyes overhauling superannuation tax concessions for wealthy Australians worth $53bn in an effort to improve the budget bottom line.
The government is also planning to make it more difficult for Australians to access their retirement savings early as it revives debate over enshrining in law an objective for the $3.3 trillion super industry.
Labor has also come under pressure to dump the contentious “stage 3” tax cuts in order to save $254bn over a decade.
The Coalition-era policy, which Labor supported, would mean no one earning up to $200,000 a year would pay more than 30 cents of the dollar in tax once the cuts come into effect in July 2024.
Treasurer Jim Chalmers made similar warnings before the October budget. Picture: NCA NewsWire / Gary Ramage
Mr Albanese said Labor was committed to an economic agenda of “relief, repair and restraint” and doing “everything we can” to help Australian families with the cost of living.
“But part of the message is that we are a responsible government when it comes to fiscal policy,” he said.
“The third element of our three Rs – restraint – is going to be there in evidence when Jim brings down his second budget in May.”
His comments echoed those Treasurer Jim Chalmers made repeatedly in the lead-up to the October budget last year about the “tough decisions” the government would have to make in order to pay for vital but expensive government services.
Dr Chalmers said last year high commodity prices had pushed up profits made from exports, resulting in a boon to Commonwealth revenue that would provide some relief for the budget over the next two years.
But he warned the boost was only temporary and wouldn’t keep up with the amount of money the government would need to spend on public services and pay off rising interest on debt.
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