The Howard Government decision in 2001 to cut indexation has cost the budget more than $46 billion in tax revenue to date. If no change is made the total cost to the budget is projected to top $160 billion by 2025.
Additional carbon dioxide emissions attributable to the policy are projected to reach 16 million tonnes by 2025.
A report released today from The Australia Institute also provided a breakdown of impact on lower income Australians.
“The cost of the Howard decision has massively blown-out over the years and the sooner a deal is made to reindex the excise, the sooner the bleeding will stop,” Executive Director of TAI, Richard Denniss said.