By Simon Black / The Financial Times A massive tax cut will lift millions out of poverty, and the government will slash social security costs to make sure it can continue to fund vital public services.
The Liberals’ plan is expected to save about $2 trillion over the next decade, which will be enough to finance $10 billion a year for about a quarter of a million families.
The biggest winners will be the middle class, who are likely to be wealthier than the average worker.
The Liberals have also announced a plan to raise $1.7 trillion from a tax on financial transactions, with a 20% cut to the top tax rate.
Mr Turnbull has promised to make tax cuts for people earning over $150,000 permanent.
This is a huge win for the rich.
They will be able to invest and invest more, with tax cuts that will make it possible to do so, said Tony Williams, an economics professor at the University of Canberra.
The middle class will be a lot better off because it is a small group that can’t be taxed, Mr Williams said.
The Liberal Party’s plans are being described as a “huge win for a wealthy few”, which will help to offset the $7.5 trillion budget deficit, according to the Commonwealth Bank.
But the plan has also drawn criticism from those who argue the Liberals are offering benefits to the rich while making it harder for middle-class families to make ends meet.
The plan has already drawn criticism because it includes a plan for a 10% tax cut for people in the top 10% of income earners, which the Conservatives have been pushing for for years.
The government has previously announced a 10-year freeze on the top marginal rate of income tax, while Mr Turnbull has previously said the Liberals plan would cut tax for high earners.
The 10% cut in tax rates would bring the top rate of tax from 38.5% to 37.5%, which is lower than the 39.6% rate that Mr Turnbull had proposed.
The top tax bracket will remain at 35%, but Mr Turnbull says the plan would lower the top bracket to 25% from 28%.
“The Liberals are now proposing to bring the average income tax rate to a low 30%, which would be a big relief to a lot of people,” Mr Williams added.
He said the top 40% tax bracket would be “unacceptable”.
“This will benefit a lot more people than the marginal tax rates that have been proposed,” Mr Cooper said.
But others have argued that it would mean a lower minimum wage, which would disproportionately hurt workers who earn less than $60,000 a year.