Wednesday, 13 July 2011

Tax Free Threshold To Rise

I'm just delighted to see that part of the balance of the Gillard carbon tax is an increase to the tax free threshold from $6,000 to $18,000. Of course, I'd like it to be higher, but this is a great step in the right direction. It's the best way to apply tax cuts.

I don't know about the rest of the package, though, except that there'll be $23 per tonne of CO2 and some tax rate increases for the high earner bracket. Both of these seem like good ideas.

As for families in worse financial conditions, I'd have to say that if they were the low income earners then the burden is in the wrong place.

Overall, dealing with carbon-based pollution is going to cost money, and applying a consumption-based tax is a way to put the power of choice into the hands of the spenders. It's quite a liberal concept. Of course, wealthy people will be in a position to buy-off their pollution - another reason why the burden should be shifted away from low incomes to high incomes. Money buys freedom, but it shouldn't be a license for carelessness and disregard.