Tax cuts to offset fuel price hike

Sorry if the title of my posting misled you but alas, no such luck for Malaysians. It's about affairs downunder.

The Australia government has just delivered a generally popular budget. The Sydney Morning Herald gave a figure of $58 billion in new spending over four years, including almost $37 billion in tax cuts and a $10 billion surplus.

However, the ABC TV channel stated that Australia expects to earn 51 billion Oz dollars in the next 5 years, of which it would spend 46 billions and keep a 5 billion dollar surplus. 28 billion will be on tax cuts while 18 billion on miscellaneous expenditure and infrastructure development such as roads and rails.

But regardless of who has been more correct, it's big lollies for the taxpayers.

The principal thrust of the tax cuts?

To ameliorate fuel price hike - I thought this might interest us Malaysians.

The Sydney Morning Herald has this to say:

Why so generous?

Because this is Mr Costello's [Treasure = Malaysian Finance Minister] embarrassment-of-riches budget. His coffers are overflowing at a time when many people are feeling the pinch from record petrol prices and the rise in interest rates.

It's not really the Government's job to bail us out just because petrol has become scarcer and dearer or because we borrowed more than was wise in the heat of the property boom.

But with so many of us feeling hip-pocket pain, how can Mr Costello justify raising $22 billion more in taxes than he needs to cover government spending - especially when, as he keeps boasting, the Government is now debt free?

Australia has been earning big revenue from its taxing of companies in gas, oil and mining, which are currently enjoying a boom because of China and her voracious appetite. The Aussie budget is the most generous and certainly timely in view of recent fuel price hike.