Q: On top-up tax cuts, once they’re fully in place they cost $7.4 billion every year. But there’s no saving of $7.4 billion a year in that year when they started so they’re unfunded. Why is that? Did you think you didn’t need to fund them by finding savings to offset tax revenue foregone?

Chalmers:

First of all, we’ve found $95 billion in savings over the course of our four budgets. I’d say again and I hope I’m not labouring this point it’s pretty unusual to have billions of savings in a Budget on the eve of an election. That’s unusual. There wasn’t many savings in the March ’22 Budget. As Katy said more eloquently than I do, the best way to think about Budget repair is not in any one specific moment in time but the progress that we’ve made over four budgets and But the previous savings… that… The improvement in the Budget is about making room for these sorts of things which are tax cuts, cost-of-living relief.

Q: But is that double counting? You’ve made savings in this term of Parliament but that doesn’t necessarily give you a new saving to fund a new initiative and here you’ve foregone the tax revenue without any additional saving to cover the cuts.

Chalmers:

The $207 billion improvement in the Budget is net of those investments we’re making in the tax cuts in addition to tax cuts we’re providing. Now, we think it’s a very important, very worthy objective to return bracket creep where you can and do it in the most responsible, cost effective, efficient way you can and that’s what the tax cuts represent. They’re modest in isolation but substantial with the rest of the tax cuts and cost-of-living help and they come in conjunction with this history-making improvement in the Budget more broadly, net of that, in addition to that.