News Paul Bongiorno: Joe Biden’s tax promise for working Americans challenges Australia’s ‘fair go’

Paul Bongiorno: Joe Biden’s tax promise for working Americans challenges Australia’s ‘fair go’

Paul Bongiorno muses that Labor could better tackle inequity if voters trusted Anthony Albanese like Joe Biden. Photo: Getty/TND
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Since the election of Joe Biden as the next president of the United States much focus has been on his ambitious climate change policies, but no less ambitious is his suite of tax reforms.

Mr Biden is aiming to raise about $3.67 trillion over a decade – that’s right, trillion dollars – to fund his promises to the “working families” in middle America.

In his victory speech the president-elect said he believed Americans had called on him to “battle to restore decency, defend democracy and give everybody in this country a fair shot”.

The “fair shot” is a bazooka aimed at repealing the top end of Donald Trump’s obscenely generous 2017 tax cuts and concessions to “billionaires and corporations”.

Donald Trump
US President Donald Trump was proud of his 2017 tax cuts.

One report has it that the President flew to his Mar-a-Lago resort in Florida after the tax cuts passed Congress and boasted to his mega wealthy mates he had just made them “all richer.”

The Biden campaign survived fact checks of its claim that “Trump wants to give the 100 richest billionaires – who have made $344 billion during the COVID-19 crisis, a combined $29 billion tax cut”.

This monument to “trickle-down economics” was an edifice the Biden-led Democrats were prepared to risk demolishing, even though the Republicans and their media allies went into hysterical overdrive claiming all taxpayers would be hit.

Again, mainstream media fact checks supported the Biden claim that “no American earning up to $400,000 would lose their tax relief’’.

Mr Biden said billionaires and corporations were his target and he was able to convince millions of voters to trust him.

It is hard to imagine any Australian political leader going to a federal election promising to raise the top personal income tax rate as well as the corporate rate.


And imagine if an Australian political leader promised to impose “a minimum tax on corporations so that none get away with paying no taxes”.

Last week Labor’s Joel Fitzgibbon was worried his “old mate” Anthony Albanese would be encouraged into overreach on climate policies after the Biden win.

Joel Fitzgibbon has privately urged the ALP to stop pretending it's a "government-in-exile".
Joel Fitzgibbon has warned the Labor Party about an overreach on climate policies and tax. Photo: AAP

Mr Fitzgibbon was just as concerned about overreach on tax as Mr Albanese and his treasury spokesman Jim Chalmers had left open the prospect of repealing the top end of the Morrison government’s Stage Three tax cuts due in 2024.

This would hit people with incomes above $180,000 or $200,000 depending on where the repeal would land.

Never mind, coal miners in Mr Fitzgibbon’s seat can earn up to those amounts he claims and he says he has a very simple view on the question of tax: “Never get in the way of a punter and a legislated tax cut.”

His concerns are understandable; the Prime Minister has already seized on Labor’s musings on Stage Three to say Mr Albanese is as big a taxer as his predecessor Bill Shorten.

When you have a look at the suite of tax changes Mr Shorten proposed, mainly to do with trimming generous tax concessions, they are tinkering at the edges compared with the Biden agenda.

Clive Palmer Bill Shorten
Clive Palmer claimed in the 2019 election that Bill Shorten’s suite of policies were not to be trusted.

But they were enough for mining and property developer billionaire Clive Palmer to falsely claim in saturation advertising costing him about $80 million that Labor “will bring back death taxes”.

The Liberals themselves successfully ran the line “Labor will tax you to death”.

The Australian National University’s 2019 election survey found voters trusted Mr Morrison on tax and the economy more than Labor’s Bill Shorten.

And maybe that’s a significant difference.

Mr Trump always knew that Mr Biden had a well-established reputation as a credible and inclusive political operator he rightly feared.

But the question still remains, if Labor had a leader voters felt they could trust as much as a significant majority of Americans trusted Mr Biden, could they sell tax policies that address the inherent inequity we now have?

The inequity is there for all to see.

Australia Institute analysis says the Stage Three tax cuts will go mainly to high-income taxpayers with over half going to the top 10 per cent, 72 per cent going to the top 20 per cent, while the bottom half get only 5 per cent and the bottom 20 per cent of taxpayers get nothing.

All for a cost of $130 billion.

Mr Biden talks about giving everyone a “fair shot” in the US.

Here in the land of the “fair go” surely it’s time to live up to our preferred self-image.

Paul Bongiorno AM is a veteran of the Canberra Press Gallery, with 40 years’ experience covering Australian politics