The CGT was changed from an extremely cumbersome and time consuming behemoth, called cost base indexing, to the current system.
It was a nightmare for all concerned, to administer and oversee, if the new system required modifying Labor should have done it.
From your statements, Labor presided over falling tax reciepts, it's there responsibility to sort it, if indeed it needed sorting.
The same applies to super, Howard came into office in 1996 and was chucked out 2007, the super system was introduced in 1992.
Therefore Howard oversaw the very early days of the super system, and had to address the 'baby boomers' starting to retire.
The balances that people had in super was minimal, even now the majority have very low balances.
In March 2006, Costello allowed people to place a one of $1million deposit into their super, before July 2006.
This was to allow the first 'baby boomers' to top up their super, before retirement.
It made sense really, it would basically take them off the pension system.
Unfortunatelly for them the GFC cleaned a lot out. Therefore post GFC the cost of the super burden would have been relitively low.
Then Labor took over the reins and responsibility, did they change the taxing on super, they were in charge when the post GFC recovery happened.
Therefore it stands to reason, they oversaw the super cost blow out and did nothing about it.
How come you lay the responsibility at Howards feet?
So basically you're saying if Govt A introduces bad policy and Govt B is unable to remove it that Govt B is now fully responsible?
The capital gains calculations pre 2000 were not a night mare. Accounting s/w pretty much did in automatically, and the ATO had easy to use tables to see what the cost base increase was. Certanlyf or an investor used to doing their sums on potential returns between different investments it wasn't rocket science.
Look at how hard Abbot fought to stop the relatively small changes to car FBT. Are you saying he would have not run a massive scare campaign if Labor had decided tobring in RBLs again and to stop promoting the conversion of income into capital gains by removing the halving of CGT? Abbott couldn't even bring himself to support changes to super pensions affecting just 16000 people.
The one off $1M into super in 2006 is of minimal concern. You've avoided the whole issue of tax free super and the fact that for a small minority it is allowing them to minimise their tax on a massive scale. When some SMSFs have over $100M in assets it's no longer about saving for retirement but shelter assets from taxation. Shouldn't Howard wear teh blame for this since it was his changes that allowed it to happen?
The post GFC recovery has been extremely weak. The current Govt is going to face an even worse situation, though in relative terms the downward trend will be similar to what Labor faced when compared to the Howard Govt.
In terms of the facts, the average annual growth in real government spending in five years from 2000-01 under Howard was 4.3%; for Labor in the five years since 2007-08, the average annual increase has been 3.4%, so if Howard was running a tight budget as you say, what would you describe Labor's efforts then?
In simple terms, in the five years from 2000-01, the Howard government increased real government spending by around 23%. In the five years from 2007-08, when Labor had controlled the budget purse strings, growth in real government spending was a tick over 17%, including the 12.7% increase in 2008-09 when the GFC was bearing down on the Australian economy, threatening a recession. So once again how do say Labor were big spenders when Howard was outspending them by a significant margin?
See the below Govt and private debt graph. That pretty much explains the Howard Govt magic. The private sector was on a debt binge and the Govt was able to save. Greece and Spain are examples where both rivate and Govt sectors are both deleveraging. It doesn't work.
For the Howard years Fed Govt revenue averaged, over those 11 years, 23.3% of GDP, some 1.7 percentage points above the average of the Hawke/Keating years. In today’s dollars, that is about $25 billion a year or a total of about $275 billion over the course of the Howard government when compared to the tax take under Hawke/Keating.
Since Labor took office in November 2007, in the three completed years of budgeting, the tax to GDP ratio averaged a comparatively tiny 20.7% – a stark number highlighting the revenue loss from the GFC and the income tax cuts that were delivered in its first three years of office.
If you think that 1% of GDP is small, it isn’t. Even 1% of GDP in todays dollar terms is a whopping $17 billion. The 1.9% of GDP lower tax take Labor experience in their first 3 years was over $96B. Imagine the deficit levels if they'd spent like Howard.
Or think of it this way, if the Labor government were to raise the tax take to the peak level under the Howard government, it would have been the equivalent of $4,000 a year, every year, for each household. Do you think Abbott would have supported tax increases like that to balance the budget?
Tax revenue fell by 2.9 percentage points relative to GDP for Labor when compared to Howard. That's where pretty much where all the deficits come from.
The budget papers estimate that the Abbott government will drop spending to an average of 24.9% of GDP over the forward estimates period. That's a mere 0.2 percentage points below Labor's spending... clearly not enough to close a deficit of 1.4%. The lowest spending in the forward estimates is 24.7% of GDP in 2016-17; at 0.4 percentage points below Labor spending that's still not going to close the deficit. In fact if you compare the difference between Labor's biggest-spending year (2009-10 at 26.0% of GDP) and the Coalition's lowest-spending year (2016-17 at 24.7% of GDP) it's still not enough to close the gap.
Or to put it another way: if Labor cut spending by as much as Tony Abbott's government is cutting, we still would have been in deficit.
Certainly I believe Labor should have implemented far more of the Henry Tax review, but honestly how much of that do you believe Abbott would have supported? Why hasn't Abbott used some in his first budget to tide him over to the tax white paper is released? If the argument is they were good policy options then they're likely to still be good options now. Abbot has wasted his first year in office and burnt massvie amounts of political capital over PPL and the GP tax.
It'll be very interesting to see what excuse are rolled out during the upcoming MYEFO. Certainly anything true for the current Govt in terms of revenue short falls was also true for Labor.
So how do you continue to call Labor profligate when the facts show they weren't.