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2009-11-05

No doubt that the Henry tax review will be disappointing

Comments on APP report "Swan says tax review likely to be '10-year plan'", 5/11/2009, http://www.businessspectator.com.au/bs.nsf/Article/Tax-review-likely-to-be-10-year-plan-XH55U?OpenDocument

The biggest disappointment is the limitation of the review not to touch the GST.
Politically, it may be a not too bad strategy, given the sensitivity around it.

But strategically it was not good to limit it to achieve efficiency and simplicity and fairness.

So one small restriction has a big effect to affect all three areas of the review's objective.
It means that the review is incomplete at the best. and misleading at the worst.

The restriction indicates that the Rudd government was timid and was not serious in economic and tax reforms beyond its normal spins that generally typifies the Rudd government's policy approach.

Now Swan admits that it is a ten year plan. What that means is that the Rudd government will not implement many of the recommendations.

It may have something to do with the effect of current economic crisis on government revenue and budget, but one cannot avoid the impression that the Rudd government is avoiding hard decisions, as it always does.

The main problem with the Rudd government is that it does not have the capability to deliver what the best government requires.

However, Rudd has been good at maanging public perceptions politically, until recently with the asylum seekers on board of Australian's custom ship the Oceanic Viking.

The asylum issue exposes the weakness of the Rudd government and the government fared very badly in the weekend's poll.

Would that be a turning point for the political fortune of the Rudd government? It remains to be seen,

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