They Spent. You Pay.

When Australian families cannot cover the bills, something has to go. Governments can demand more money from those same families. The latest tax reform proposal would give them a bigger claim on the weekly grocery budget, reaching straight into the fresh-food aisle.

The Grattan Institute’s Budget Reboot report, released on 18 October, proposes lifting the GST from 10 to 15 percent and extending it to all food. It would raise an estimated $76 billion annually, with $33 billion funding income-tax cuts, $25 billion supporting higher welfare payments and $18 billion going to the states.

Grattan proposes increases to JobSeeker, pensions and other payments, including a 50 percent rise in Rent Assistance. Its household examples put a low-income single-parent renter $150 a week ahead. A higher-income working family, however, pays $262 more in GST and receives a $100 tax cut, leaving it $162 a week worse off. That is $8,424 over a year.

The full report says most households would pay more overall. It also acknowledges gaps among people with low living standards, including young adults whose access to Youth Allowance is restricted by parental means tests. But a household does not become comfortable simply because a government formula denies it assistance.

At the checkout, the tax applies regardless of whether compensation fits your circumstances. A $100 purchase of currently GST-free food becomes $115 if the tax is passed through in full and the underlying price stays unchanged. Families cannot indefinitely cut food spending without changing what they eat.

Grattan recommends ten-year debt targets and annual limits on spending growth, with independent budget offices checking governments’ finances. Governments that overspend would be expected to make up the difference in later years. But the report also acknowledges that governments have a poor record of sticking to their existing budget targets.

Taxpayers are being asked to accept a bigger GST alongside another promise of spending discipline. Governments should already be required to correct overspending, with ministers answering publicly for failures. That is a basic duty, not a concession to be traded for higher taxes. Australians should demand restraint without surrendering another slice of the household grocery budget.

The promised income-tax cuts have a weakness: Grattan expects bracket creep to continue. When tax thresholds stay fixed, even a pay rise that merely keeps pace with inflation can push more earnings into higher tax brackets. The government takes a larger share without the worker becoming better off. Over time, that erodes the promised relief. The higher GST would remain, while workers waited for politicians to grant another tax cut.

Australians should reject this bad idea. Promised tax cuts and higher welfare payments do not justify taxing fresh food or making families depend on government to return part of what it takes. Government debt is no licence to raid the household grocery budget. Ministers should cut waste, scrap projects that cannot justify their cost and bring spending under control before demanding another dollar at the checkout.

The family shopping trolley is no place to collect the price of political failure. Australians work to feed their children, pay their bills, and build lives of their own. Governments have no automatic entitlement to a larger share whenever the public accounts turn ugly.

Leave the grocery money alone.

“We don’t have a deficit because we’re taxed too little; we have a deficit because they’re spending too much.”
– Ronald Reagan