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Costello's bullying to create Commonwealth tax windfall.

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Wayne Swan Shadow Treasurer

Costello's Bullying To Create Commonwealth Tax Windfall

Wayne Swan

29th March 2005

Analysis conducted by Access Economics shows Peter Costello's arrogant bullying of the states could

see up to $700 million added to Commonwealth coffers.

Last Wednesday the Treasurer claimed the federal Government would not benefit financially from his

proposal when he told ABC Radio that:

"If these taxes are abolished, the Commonwealth Government doesn't get anything, the

people who get things are the businesses and consumers of Australia. The money doesn't go

to Canberra, the money gets taken out of the purse of businesses and consumers at the

moment and if these taxes are abolished it goes straight back in."

Access Economics have exposed this claim as just another furphy from Peter Costello; more

deception from the highest taxing Treasurer in Australia's history.

According to the report, the immediate abolition of the state taxes nominated by the Treasurer last

week would cost the states $3.2 billion but would benefit the Commonwealth by $700 million.

Peter Costello's proposal for a staggered introduction of these cuts over 2006 and 2007, while not

immediately generating the full $700 million windfall for the Commonwealth, would nonetheless see

the Government receive a significant financial benefit.

This in addition to the $2 billion windfall they have received over the past three years as a result of not

having to top up higher than anticipated GST revenue to the states.

All this comes on top of the $12 billion collected this year by the Treasurer over and above the revenue

the Treasury anticipated four years ago.

Given Peter Costello's record tax take it is not surprising that he has created and fuelled this conflict

with the states to hide his big taxing ways.

But his sneaky and arrogant grab for up to $700 million at a cost to the states of $3.2 billion has taken

his tax double standards to new heights. ENDS