CANBERRA, April 16 (Xinhua) -- The Australian government has denied that it will have to dramatically cut spending to deliver its proposed tax cuts, in a responding to the findings released by Australia's leading policy think tank.
The Grattan Institute on Tuesday released its analysis of the tax plan proposed by Treasurer Josh Frydenberg in his Federal Budget for 2019/20.
It found that in order to deliver all three stages of the plan, which includes tax cuts for all Australians earning up to 200,000 Australian dollars (143,459 U.S. dollars) per year, while maintaining a budget surplus the government would have to cut spending by 40 billion Australian dollars (28.6 billion U.S. dollars) per year by 2030.
Responding to the findings, Frydenberg said that they were simply wrong.
"They are wrong. What we are doing is getting more people into work and therefore government spending is less. That is the key point," he told Australian Broadcasting Corporation (ABC) radio.
"Where our savings, where our budget surplus has come from, is actually by getting a record number of people in work and the proportion of working age Australians who are on welfare is the lowest in 30 years. That is a great story.
"These tax cuts are non-negotiable because they actually strengthen the economy. But the second point is they are not mutually exclusive from the record spending on essential services that we have actually guaranteed."
The Grattan Institute's report has been seized upon by the opposition Australian Labor Party (ALP), which has ruled out supporting stages two and three of the tax plan and instead will offer low-income earners bigger cuts if it wins the general election on May 18.
"The whistle has been blown on the government's secret cuts to spending in the Budget," ALP leader Bill Shorten told reporters on the campaign trail.
"The secret's out. This is a government with secret cuts to spending in its Budget to fund its promises on the never-never, for tax cuts." Enditem
