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Robert Carling

The tax cut that will only buy you a coffee

The Labor government appears to have chosen a cut confined to the lowest rate so that it could stick to its “tax cut for everyone” slogan.

Hard-pressed taxpayers will welcome any relief, but the modest size of the unexpected personal income tax cut in this week’s federal budget – at most $5 a week from July 2026 and $10 from July 2027 – makes it a sitting duck for ridicule.

In 2003, as a senior minister, Amanda Vanstone coined the term “sandwich and milkshake” to characterise the small tax cut included in that year’s budget, which was $4 to $11 a week for most taxpayers.

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Robert Carling is a Senior fellow at the Centre for Independent Studies, and a former IMF and federal and state Treasury economist.

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    Original URL: https://www.afr.com/politics/federal/the-tax-cut-that-will-only-buy-you-a-coffee-20250326-p5lmn0