despite labors claims tax revenue is up 7%, page-15

hairyback, gilded, duty, zzedzz et al,


I agree you're being conned - but not by the people you think it is.


Joe Hockey is being deliberately misleading. He knows better and should be communicating information as clearly and as honestly as possible.

If you REALLY want to know the economic situation you will read on...

The 7% figure quoted is the percentage increase in terms of the ABSOLUTE GDP.

No economist, economics department, finance department or treasury in ANY of the OECD governments in the WORLD use absolute numbers!!

revenue IS down. Not only is it down - it's down CONSIDERABLY!! Forget the absolute numbers! Look in terms of percentage of GDP. The reason that absolute numbers are misleading is that they don't account for changes in other quantities. For example, revenue expressed as a % of GDP automatically accounts for the fact that the population is higher than it was 6 years ago. It also automatically accounts for the fact that prices and wages are higher than they were 6 years ago. Therefore, government spending has to go out to more people (more people claiming medicare, more people in schools etc.) and they're paying people (eg, nurses, doctors, policemen) higher wages than 6 years ago.

This is why nearly all economic indicators are expressed in percentages.

unemployment - %
interest rates - %
inflation - %

but for some reason Joe says that revenue is up just because the absolute number today is greater than the absolute number 6 years ago. The absolute number is VERY misleading.

Let's just put aside party politics for 3 minutes.

Consider the following from,

http://www.smh.com.au/opinion/politics/before-we-tackle-the-budget-lets-clarify-a-few-points-20130429-2iot4.html


"In the last eight years of the Howard government, cash revenues averaged 25.4 per cent of GDP while spending was 24.2 per cent. Result? Budget surpluses averaging 1.2 per cent of GDP.

In 2012-13, revenue will be roughly 23.2 per cent of GDP. Underlying spending, after adjusting for last year's budget fiddles (which shifted $9 billion of spending into 2011-12), will be roughly 24.5 per cent of GDP.

You do the sums. Which is the bigger problem: revenue or spending?"

Spending (as a fraction of GDP) has increased by 0.3% !!!

Revenue (as a fraction of GDP) decreased by 2.4% !!!

Any OBJECTIVE analysis of this data would conclude that spending is not the problem. The problem is revenue! The economic slowdown is caused by the recoil of the GFC. Now, whether people LIKE/DISLIKE those conclusions doesn't change the fact they're correct.


It's prefectly FINE if the general aussie population doesn't know this.

However Joe DOES know this... but he's choosing to spin it a different way... and that's NOT fine!