Prime Minister Malcom Turnbull’s Hamletian dilemma on tax reforms has offered the opportunity for Tony Abbott to do some political muscle flexing. On Tuesday, the former Prime Minister joined the tax debate and cautioned the Turnbull government against ignoring the Coalition’s core commitment of delivering lower taxes.
He was speaking in a party meeting called to discuss the merits of modifying negative gearing. Abbott reminded Turnbull that taxes cannot be reduced by raising them, reports The Sydney Morning Herald.
Cautioning Turnbull against tinkering with negative gearing, Abbott said the coalition cannot ape Labor on this because “if we do, our words will come back to haunt us.”
He urged Turnbull to look at other options including budget savings. Though it might be difficult, the government has to revisit the task, Abbott noted. The former PM said the budget did not have a revenue problem, its problem is in spending.
Several MPs at the party meeting agreed that the coalition must keep negative gearing on property income intact to take on Labor’s policy of restricting it to new homes.
A News Corp report added that Abbott seemed to be throwing his weight behind his Coalition colleagues who wanted negative gearing untouched while exploring suitable budget cuts. Comments of the former PM also bore his response to the update given by Treasurer Scott Morrison that the government is running out of options in tax reform.
Morrison disclosed his belief at the party meeting that the government’s tax options were severely limited and urged steps for cutting income tax.
“When it comes to tax policy we are dancing on the top of a pin head,” he said.
Turnbull in his reply, praised Tony Abbot and said leadership was about both “continuity and change.”
“Scott Morrison and I are completing the process of looking right across the board (in terms of tax and budget policy) which you and Joe Hockey … so openly and courageously began,” Turnbull said.