CAN WE AFFORD IT?

● The immediate tax cuts for low and middle-income earners will cost the government $13.4 billion in lost revenue over the next four years.

● What the Budget papers don’t make clear is how much it will cost to extend the cuts to higher income earners in 2024-25.

● However, Finance Minister Mathias Cormann revealed to the Bulletin that the government estimates the income tax reforms will cost a whopping $140 billion in lost revenue over 10 years. Despite the hefty price tag, the Treasurer says the tax plan is “affordable and funded”.

● “The overwhelming majority of this cost commences in 2019-20, the same year the Budget is forecast to return to balance,” Mr Morrison said.

● In an earlier press conference, the Treasurer said the government could afford the measures because more Australians were in work and paying tax.

● “More tax is being recovered and we’re saying too much is coming in out of people’s pockets and they should get to keep it,” he said.