Letters
Letters to
the editor
All the dumb things
Karen Barlow says the Coalition is considering indexation of personal income tax scales to end bracket creep (“On the plane with Albanese: ‘In turbulent seas, we’ve kept our eye on the horizon’ ”, April 19-25). This is the most dangerous of a lot of dumb ideas coming out of the Liberal Party this election. It would make the return to surplus after shocks and downturns dependent on politicians making difficult decisions – not their strong suit. It would remove a built-in fiscal brake on any wage-inflation spiral, so interest rates could end up higher. The virtue for the Liberal right is it creates an excuse for austerity and chainsawing services but, equally likely, rolling deficits and financial crises.
– Gordon Wright, Hobart, Tas
Set up to fail
Writing as a former adviser to New Zealand’s Productivity Commission inquiry into housing affordability in 2011-12, there is no sound policy rationale for either of the demand-side measures announced by the traditional parties last week to assist first- home buyers (Mike Seccombe, “House of cards”, April 19-25). They just boost the lolly scramble that has blighted this campaign and will ramp up tax expenditure. Labor’s 5 per cent deposit scheme runs the risk of setting up marginal borrowers to fail, especially with economic uncertainty building. Without a sizeable superannuation account, the Coalition’s First Home Buyer Mortgage Deductibility scheme does nothing for barriers to access. Like HomeBuilder, both schemes will pull forward demand prematurely and further inflate land, labour and material costs for “new builds”.
– Blair Badcock, Kensington Gardens, SA
Equity loss
The Coalition promotes the potential benefits of the proposed superannuation home buyer scheme. Less is said about the impact if the property is sold. To avoid a penalty, the amount withdrawn would have to be returned to the super fund, along with a proportion of any capital gain. This means the home owner would lose a significant level of equity in their home, which could affect their capacity to buy another property. Not only does this policy have the potential to increase house prices due to increased demand, but it also has a sting in the tail through a loss in home equity.
– Paul Wales, Woolooware, NSW
In proportion
Bob Brown considers the need for electoral system reform of all lower houses of parliament (“A guide to minority government”, April 19-25). The record in Tasmania speaks for itself. In 1989 the state’s system of proportional representation allowed the Greens to win five out of 35 seats in the House of Assembly and Brown became their leader. In 2012, he left the Greens with the highest primary Senate vote of any minor party since proportional representation was introduced in 1948. Some 90 countries have proportional representation as their principal electoral system. Dr H.V. Evatt said “the fairest system and the one most likely to enhance the status of the Senate is that of proportional representation”. The Greens gained just four seats in the House of Representatives in 2022 with 12.3 per cent of the vote. That would have been 18 seats in a proportional system, a fair result.
– Klaas Woldring, Nambucca Heads, NSW
Switch and bait
Martin McKenzie-Murray highlights some unintended consequences of high tobacco excise taxes but misses crucial context (“Smokes screens”, April 19-25). Australia’s world-leading reductions in smoking rates are largely the result of sustained public health efforts, including taxation. The article relied on the views of criminologists and economists, without the input of tobacco control or public health experts. While concerns about the growth of the illicit market are valid, the suggestion to “radically reduce the rate of cigarette taxation, and the black market will disappear overnight” is simplistic. A decade ago, tobacco excise was about 53 cents per stick, with retail prices around $22 a packet. Today, illicit cigarettes are typically sold for about $15 a pack. Even if we reverted to the 2015 tax rate, they would still be substantially cheaper than taxed, legal products. The illicit market is now entrenched and requires a sophisticated response including tobacco licensing and action on organised crime.
– Jennifer Browne, senior research fellow, Global Centre for Preventive Health and Nutrition, Deakin University, Geelong
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This article was first published in the print edition of The Saturday Paper on April 26, 2025.
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