However it has not spelled out in any detail what it will do with that extra revenue.
It can :
- Increase spending
- reduce the budget deficit
- reduce taxes
- a combination of all three
What we need to know is exactly what they will do.
I see no reason to either increase spending or reduce taxes. Nominal GDP growth is back to reasonable levels so budget consolidation seems to me the obvious thing to do.
Whilst there is no reason to increase spending the ALP could change spending levels within different areas.
Reducing taxes whilst the budget is still in deficit is lubricious and shows the government has given up on budget consolidation.
Political considerations means they will choose 4 however I do hope most of the extra revenue goes toward budget consolidation.
My feeling is we are in unique territory where this could benefit the ALP in both economic and political terms.