Australia's tax burden hits lowest point since pandemic

Australia's Treasurer Jim Chalmers will present the federal budget on Tuesday night. He is expected to highlight a reduction in the tax burden, noting it is now at its lowest since the pandemic. Taxation is forecasted to fall to 23.1% of the economy, down from 23.7% last year. Chalmers will assure Australians that living standards are improving. He claims wages are rising faster than inflation, and the economy is creating jobs. He mentioned that when Labor took office, living standards were declining sharply. Now, he says, inflation and interest rates are decreasing, contributing to a recovery. However, the opposition Coalition disagrees with the government's tax policies. Shadow treasurer Angus Taylor argues that households are actually paying more tax, despite recent reforms. He criticized Chalmers for not providing a long-term tax target, which the Coalition believes is important for government accountability. The budget is also expected to show that the government is facing a deficit as spending growth exceeds revenue increases. The government will announce $2.1 billion in savings and cuts, primarily targeting spending on consultants and contractors. Labor has cut or reprioritized about $95 billion since the last election, which it claims has allowed for investments in crucial areas like housing and healthcare. The Coalition, meanwhile, plans to reduce public service jobs to save $6 billion annually, although they have not confirmed exact numbers. Dissatisfaction over public service costs has led both parties to clash over different spending programs. Labor is cautious about further financial assistance to avoid inflating costs and risking higher interest rates. A debate is also ongoing about remote work policies and their potential costs to Australians, with neither side wanting to ban work-from-home arrangements.