"If there is to be no compromise on welfare, surely your only...

"If there is to be no compromise on welfare, surely your only choice is to raise government revenues ... and that can only come from taxing the presently comfortable and the presently wealthy and business?"

With Federal revenue failing to increase at previous boom rates this Government has decided that a reversal of Federalism is in order.
Consequently they have started a process that will require the states to raise more of their own income to spend on health and education. Increasing payroll tax has been a suggested course to take.
Bracket creep should help the Federal Government cover much of their expenditure as long as they don't succumb to tax cuts over the next 2 years. Cuts might be hard to resist as an election bribe.