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Fightback - setting the record straight when will the prime minister meet his promise and return bracket creep?



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I t o

Peter Reith

DEPUTY LEADER of the OPPOSITION PRESS RELEASE SHADOW TREASURER

Bulletin No 29

F1GHTBACK- SETTING THE RECORD STRAIGHT

W HEN WILL THE PRIME MINISTER M E E T H IS PROMISE A N D RETURN BRACKET CREEP?

Well now we know it.

The Prime Minister has committed himself to match our income tax cuts before the next election - presumably in the 1992/93 Budget?

But let's not forget the ‘big promise* from the 1990 Federal election.

The Prime Minister is already committed to giving back the proceeds of ‘bracket creep*. Reprinted below is Mr Hawke's promise made in desperation at the National Press Club on 21 March 1990 just prior to the last election.

Journalist: ‘Prime Minister, will you match the Liberal Partys promise that they will hand back each year the proceeds of bracket creep?"

Prime Minister: *... The answer is, of course, yes. Because I have done it for seven years and i will do it for the next seven years. More than do it for the next seven y e a rs ... The answer to your question is y e s '

Assuming his wage forecast for 1991/92 is correct, that could mean he would have to give back about $1.5 billion just to meet his promise.

But our tax cuts are over and above that dividend.

So where will he find the $13 billion from to match our tax cuts?

He has ruled out expenditure cuts.

And surely he does not intend to pay for it from deficit funding with the October Commonwealth Financial Transactions (released surreptitiously late on Friday) showing the Budget in danger of blowing off course and the total PSBR already heading to over 4 per cent of GDP.

So does he have a hidden agenda to put up other taxes?

No wonder that some of his fellow Ministers are muttering about their Prime Minister's rashness.

2 December 1991 Canberra D162/91

COMMONWEALTH PARLIAMENTARY LIBRARY MICAH