I have mentioned a few times recently that I believe there is a good chance the FHOG will be raised soon, and maybe as an election promise late next year. Quite obviously, the FHOG is worth half of what it was 5 years ago.
The article below confirms to me the Coalition's concern about the falling birth rate, and their prioirity to curb that. Raising the FHOG would definitely seem to be on the table in achieving the same ends.
One could argue that rentals will continue to tighten, and that pressure could be relieved by helping young families out of the rental market and into PPORs.
However, the unknown is whether PIers will continue to compete with FHOs for product, thus driving prices up, and achieving no gains for anyone....
Whatever, IMHO the Coalition will be putting a lot of thought into how to redistribute wealth from baby boomers to young families over the next 10 years... If the free market (esp the property and mortgage markets) won't favour this, then the government certainly will.
How they get the balance right will be very interesting...
http://www.theaustralian.news.com.au/story/0,20867,18856982-601,00.html
PM signals big tax cuts for parents
David Uren, Economics correspondent April 19, 2006
JOHN Howard has signalled to low and middle-income families they can expect substantial tax relief in next month's budget, after identifying the need to help with the costs of raising children as his Government's top priority.
The Prime Minister also dampened expectations for significant change at the top end of the tax scale, saying the Government had already done a lot for high-income earners, with the number of people paying the top marginal tax rate of 48.5 per cent falling from 14 per cent to 3 per cent in the past three years.
Mr Howard said yesterday rhetoric on tax reform meant little without a focus on the pressures facing families. "My Government places the low and middle-income families of Australia squarely in the foreground of our policy lens," he said.
"And strengthening the family - helping them with the costs of raising children - is the best way any government can reinforce social cohesion and stability in a changing world."
After the $4 billion-a-year increase to the family tax benefit system in the 2004 pre-election budget, the Government may choose to deliver help to families in a different way this year.
In a speech to the Menzies Research Centre last night, Mr Howard said the family tax benefit system gave parents choices about how they balanced work and family responsibilities.
"The Government has been especially keen to give families with children greater freedom to choose how they balance work and family responsibilities, including through additional support for those families who desire to have one parent - usually the mother - at home full time with children in their early years."
He ruled out introducing a family income means-test on the benefit paid to mothers who choose to stay at home, saying that Labor's proposal to cap payments where family income exceeded $250,000 was the "thin edge of the wedge".
He said the benefits were not middle-class welfare. "They are tax relief for a universal reality - that it costs money to raise children."
Mr Howard said nearly three quarters of recipients were on incomes below $50,000 a year.
But he said Labor's plan would save only $6 million a year - meaning the Opposition must be planning to whittle down the threshold further if elected.
"In government, Labor would have a much tighter income test which would affect tens of thousands of single-income Australian families who could by no stretch of the imagination be described as rich," he said.
"The family tax benefit system symbolises the great philosophical divide in Australian politics between a Labor Party that thinks government should direct people's behaviour and a Coalition that sees its role as letting families make up their own minds."
Mr Howard also attacked critics of the family tax benefit system who say that taxing people and then giving them money back as benefits is "churning".
"Income tax raises revenue according to an individual's capacity to pay, while the family payments system is focused on need, assisting families according to their income and number of dependents," Mr Howard said.
He said that if family tax benefits were rolled into the tax system, the bulk of individual tax cuts would go to men, financed by the withdrawal of direct fortnightly payments to women.
Mr Howard's speech follows several comments from Treasurer Peter Costello that his priority in framing the budget would be providing help to families on low to middle incomes.
With a healthy budget surplus estimated to be as high as $16billion, Mr Howard said the Government would look at cuts after meeting its spending responsibilities. "Taxpayers deserve tax relief. After all, it is their money," he said.
University of NSW tax specialist Neil Warren said the Government might borrow tax ideas from New Zealand, which abolished the tax-free threshold, but replaced it with a series of more generous rebates for people on low to middle incomes and for taxpayers with children.
A joint statement by Labor Treasury spokesman Wayne Swan and family spokesman Chris Evans said the Government was ignoring the punishing tax that families faced as parents increased the amount of work they undertook.
They said Labor fully supported the financial assistance provided by family tax benefits.
"However we will not sit by and watch a well-intentioned benefit system be destroyed by incentive-killing 50, 60 and 70 cent tax grabs."
Mr Howard likened his Government's commitment to families to former Liberal leader Robert Menzies' appeal to the "forgotten people".
PM signals big tax cuts for parents
David Uren, Economics correspondent April 19, 2006
JOHN Howard has signalled to low and middle-income families they can expect substantial tax relief in next month's budget, after identifying the need to help with the costs of raising children as his Government's top priority.
The Prime Minister also dampened expectations for significant change at the top end of the tax scale, saying the Government had already done a lot for high-income earners, with the number of people paying the top marginal tax rate of 48.5 per cent falling from 14 per cent to 3 per cent in the past three years.
Mr Howard said yesterday rhetoric on tax reform meant little without a focus on the pressures facing families. "My Government places the low and middle-income families of Australia squarely in the foreground of our policy lens," he said.
"And strengthening the family - helping them with the costs of raising children - is the best way any government can reinforce social cohesion and stability in a changing world."
After the $4 billion-a-year increase to the family tax benefit system in the 2004 pre-election budget, the Government may choose to deliver help to families in a different way this year.
In a speech to the Menzies Research Centre last night, Mr Howard said the family tax benefit system gave parents choices about how they balanced work and family responsibilities.
"The Government has been especially keen to give families with children greater freedom to choose how they balance work and family responsibilities, including through additional support for those families who desire to have one parent - usually the mother - at home full time with children in their early years."
He ruled out introducing a family income means-test on the benefit paid to mothers who choose to stay at home, saying that Labor's proposal to cap payments where family income exceeded $250,000 was the "thin edge of the wedge".
He said the benefits were not middle-class welfare. "They are tax relief for a universal reality - that it costs money to raise children."
Mr Howard said nearly three quarters of recipients were on incomes below $50,000 a year.
But he said Labor's plan would save only $6 million a year - meaning the Opposition must be planning to whittle down the threshold further if elected.
"In government, Labor would have a much tighter income test which would affect tens of thousands of single-income Australian families who could by no stretch of the imagination be described as rich," he said.
"The family tax benefit system symbolises the great philosophical divide in Australian politics between a Labor Party that thinks government should direct people's behaviour and a Coalition that sees its role as letting families make up their own minds."
Mr Howard also attacked critics of the family tax benefit system who say that taxing people and then giving them money back as benefits is "churning".
"Income tax raises revenue according to an individual's capacity to pay, while the family payments system is focused on need, assisting families according to their income and number of dependents," Mr Howard said.
He said that if family tax benefits were rolled into the tax system, the bulk of individual tax cuts would go to men, financed by the withdrawal of direct fortnightly payments to women.
Mr Howard's speech follows several comments from Treasurer Peter Costello that his priority in framing the budget would be providing help to families on low to middle incomes.
With a healthy budget surplus estimated to be as high as $16billion, Mr Howard said the Government would look at cuts after meeting its spending responsibilities. "Taxpayers deserve tax relief. After all, it is their money," he said.
University of NSW tax specialist Neil Warren said the Government might borrow tax ideas from New Zealand, which abolished the tax-free threshold, but replaced it with a series of more generous rebates for people on low to middle incomes and for taxpayers with children.
A joint statement by Labor Treasury spokesman Wayne Swan and family spokesman Chris Evans said the Government was ignoring the punishing tax that families faced as parents increased the amount of work they undertook.
They said Labor fully supported the financial assistance provided by family tax benefits.
"However we will not sit by and watch a well-intentioned benefit system be destroyed by incentive-killing 50, 60 and 70 cent tax grabs."
Mr Howard likened his Government's commitment to families to former Liberal leader Robert Menzies' appeal to the "forgotten people".
The article below confirms to me the Coalition's concern about the falling birth rate, and their prioirity to curb that. Raising the FHOG would definitely seem to be on the table in achieving the same ends.
One could argue that rentals will continue to tighten, and that pressure could be relieved by helping young families out of the rental market and into PPORs.
However, the unknown is whether PIers will continue to compete with FHOs for product, thus driving prices up, and achieving no gains for anyone....
Whatever, IMHO the Coalition will be putting a lot of thought into how to redistribute wealth from baby boomers to young families over the next 10 years... If the free market (esp the property and mortgage markets) won't favour this, then the government certainly will.
How they get the balance right will be very interesting...
http://www.theaustralian.news.com.au/story/0,20867,18856982-601,00.html
PM signals big tax cuts for parents
David Uren, Economics correspondent April 19, 2006
JOHN Howard has signalled to low and middle-income families they can expect substantial tax relief in next month's budget, after identifying the need to help with the costs of raising children as his Government's top priority.
The Prime Minister also dampened expectations for significant change at the top end of the tax scale, saying the Government had already done a lot for high-income earners, with the number of people paying the top marginal tax rate of 48.5 per cent falling from 14 per cent to 3 per cent in the past three years.
Mr Howard said yesterday rhetoric on tax reform meant little without a focus on the pressures facing families. "My Government places the low and middle-income families of Australia squarely in the foreground of our policy lens," he said.
"And strengthening the family - helping them with the costs of raising children - is the best way any government can reinforce social cohesion and stability in a changing world."
After the $4 billion-a-year increase to the family tax benefit system in the 2004 pre-election budget, the Government may choose to deliver help to families in a different way this year.
In a speech to the Menzies Research Centre last night, Mr Howard said the family tax benefit system gave parents choices about how they balanced work and family responsibilities.
"The Government has been especially keen to give families with children greater freedom to choose how they balance work and family responsibilities, including through additional support for those families who desire to have one parent - usually the mother - at home full time with children in their early years."
He ruled out introducing a family income means-test on the benefit paid to mothers who choose to stay at home, saying that Labor's proposal to cap payments where family income exceeded $250,000 was the "thin edge of the wedge".
He said the benefits were not middle-class welfare. "They are tax relief for a universal reality - that it costs money to raise children."
Mr Howard said nearly three quarters of recipients were on incomes below $50,000 a year.
But he said Labor's plan would save only $6 million a year - meaning the Opposition must be planning to whittle down the threshold further if elected.
"In government, Labor would have a much tighter income test which would affect tens of thousands of single-income Australian families who could by no stretch of the imagination be described as rich," he said.
"The family tax benefit system symbolises the great philosophical divide in Australian politics between a Labor Party that thinks government should direct people's behaviour and a Coalition that sees its role as letting families make up their own minds."
Mr Howard also attacked critics of the family tax benefit system who say that taxing people and then giving them money back as benefits is "churning".
"Income tax raises revenue according to an individual's capacity to pay, while the family payments system is focused on need, assisting families according to their income and number of dependents," Mr Howard said.
He said that if family tax benefits were rolled into the tax system, the bulk of individual tax cuts would go to men, financed by the withdrawal of direct fortnightly payments to women.
Mr Howard's speech follows several comments from Treasurer Peter Costello that his priority in framing the budget would be providing help to families on low to middle incomes.
With a healthy budget surplus estimated to be as high as $16billion, Mr Howard said the Government would look at cuts after meeting its spending responsibilities. "Taxpayers deserve tax relief. After all, it is their money," he said.
University of NSW tax specialist Neil Warren said the Government might borrow tax ideas from New Zealand, which abolished the tax-free threshold, but replaced it with a series of more generous rebates for people on low to middle incomes and for taxpayers with children.
A joint statement by Labor Treasury spokesman Wayne Swan and family spokesman Chris Evans said the Government was ignoring the punishing tax that families faced as parents increased the amount of work they undertook.
They said Labor fully supported the financial assistance provided by family tax benefits.
"However we will not sit by and watch a well-intentioned benefit system be destroyed by incentive-killing 50, 60 and 70 cent tax grabs."
Mr Howard likened his Government's commitment to families to former Liberal leader Robert Menzies' appeal to the "forgotten people".
PM signals big tax cuts for parents
David Uren, Economics correspondent April 19, 2006
JOHN Howard has signalled to low and middle-income families they can expect substantial tax relief in next month's budget, after identifying the need to help with the costs of raising children as his Government's top priority.
The Prime Minister also dampened expectations for significant change at the top end of the tax scale, saying the Government had already done a lot for high-income earners, with the number of people paying the top marginal tax rate of 48.5 per cent falling from 14 per cent to 3 per cent in the past three years.
Mr Howard said yesterday rhetoric on tax reform meant little without a focus on the pressures facing families. "My Government places the low and middle-income families of Australia squarely in the foreground of our policy lens," he said.
"And strengthening the family - helping them with the costs of raising children - is the best way any government can reinforce social cohesion and stability in a changing world."
After the $4 billion-a-year increase to the family tax benefit system in the 2004 pre-election budget, the Government may choose to deliver help to families in a different way this year.
In a speech to the Menzies Research Centre last night, Mr Howard said the family tax benefit system gave parents choices about how they balanced work and family responsibilities.
"The Government has been especially keen to give families with children greater freedom to choose how they balance work and family responsibilities, including through additional support for those families who desire to have one parent - usually the mother - at home full time with children in their early years."
He ruled out introducing a family income means-test on the benefit paid to mothers who choose to stay at home, saying that Labor's proposal to cap payments where family income exceeded $250,000 was the "thin edge of the wedge".
He said the benefits were not middle-class welfare. "They are tax relief for a universal reality - that it costs money to raise children."
Mr Howard said nearly three quarters of recipients were on incomes below $50,000 a year.
But he said Labor's plan would save only $6 million a year - meaning the Opposition must be planning to whittle down the threshold further if elected.
"In government, Labor would have a much tighter income test which would affect tens of thousands of single-income Australian families who could by no stretch of the imagination be described as rich," he said.
"The family tax benefit system symbolises the great philosophical divide in Australian politics between a Labor Party that thinks government should direct people's behaviour and a Coalition that sees its role as letting families make up their own minds."
Mr Howard also attacked critics of the family tax benefit system who say that taxing people and then giving them money back as benefits is "churning".
"Income tax raises revenue according to an individual's capacity to pay, while the family payments system is focused on need, assisting families according to their income and number of dependents," Mr Howard said.
He said that if family tax benefits were rolled into the tax system, the bulk of individual tax cuts would go to men, financed by the withdrawal of direct fortnightly payments to women.
Mr Howard's speech follows several comments from Treasurer Peter Costello that his priority in framing the budget would be providing help to families on low to middle incomes.
With a healthy budget surplus estimated to be as high as $16billion, Mr Howard said the Government would look at cuts after meeting its spending responsibilities. "Taxpayers deserve tax relief. After all, it is their money," he said.
University of NSW tax specialist Neil Warren said the Government might borrow tax ideas from New Zealand, which abolished the tax-free threshold, but replaced it with a series of more generous rebates for people on low to middle incomes and for taxpayers with children.
A joint statement by Labor Treasury spokesman Wayne Swan and family spokesman Chris Evans said the Government was ignoring the punishing tax that families faced as parents increased the amount of work they undertook.
They said Labor fully supported the financial assistance provided by family tax benefits.
"However we will not sit by and watch a well-intentioned benefit system be destroyed by incentive-killing 50, 60 and 70 cent tax grabs."
Mr Howard likened his Government's commitment to families to former Liberal leader Robert Menzies' appeal to the "forgotten people".
