Opposition Leader David Speirs warns of tax rises ahead of June 2 state budget

Major tax rises will be needed to fund Labor’s $3.1bn in state election promises as costs and interest rates start rising, the Liberals warn.

Significant tax rises will be required to fund Labor’s $3.1bn in state election promises amid rising interest rates and inflation, Opposition Leader David Speirs warns.

Responding to Treasurer Stephen Mullighan’s vow to start delivering the commitments in his June 2 budget based on pre-election costings, Mr Speirs said the government risked imposing massive hits to cost of living and businesses.

“The big question is are we going to see massive cuts to services or are we going to see significant tax rises, because there’s no magic money tree,” Mr Speirs said.

“ … We suspect there will be significant tax rises into the future. Will it be this budget? Perhaps not – it certainly will be in the future.”

Opposition Leader David Speirs at Parliament House. Picture: NCA NewsWire / David Mariuz

In an interview with The Advertiser on Wednesday, Mr Mullighan said rising debt, inflation and interest rates would put pressure on his June 2 budget but vowed all of Labor’s $3.118bn in election commitments would be delivered based on pre-poll costings.

But Mr Speirs highlighted an inflation rise of 4.7 per cent for South Australia in the March quarter – the highest since 2008.

“South Australians are paying more for everyday items, yet Peter Malinauskas and Stephen Mullighan appear to think taxpayers won’t have to pay a cent more for their lofty promises that were costed before the election,” Mr Speirs said.

“How Stephen Mullighan thinks he’s somehow exempt from the pressure of rising inflation and interest rates without tax increases and budget blowouts is galling.

“Something’s got to give and Labor needs to be honest with taxpayers about how their first budget is going to impact the hip pockets of South Australians or the services they rely on.”

Treasurer Stephen Mullighan. Picture Simon Cross

The state Liberal leader also warned of “pretty dramatic cuts” ahead for government departments, such as environment and primary industries, which had not been deemed frontline services and, therefore, spared from Labor’s 1.7 per cent efficiency dividend.

“We’re calling for Labor to start giving South Australians an indication as to how they’re going to fulfil their commitments without any new taxes, without tax increases – and in the face of these fairly significant economic headwinds at a global level,” Mr Speirs said.

In The Advertiser interview, Mr Mullighan also forecast he would deliver a surplus for the next financial year and cautioned public sector unions whose pay deals were coming up for renegotiation to temper demands, declaring it was not a case of “the brakes are off and these guys can have whatever they want”.