If you can enact a tax reform that improves both equality and efficiency, you must be doing something right. And so it seems with the government’s mooted redesign of the former Coalition government’s stage 3 tax cuts, to be announced by Prime Minister Anthony Albanese on Thursday.

Arthur Okun, US president Lyndon B Johnson’s chief economic adviser, described the key challenge in tax policy as akin to a leaky bucket: seeking to reduce inequality by redistributing income is like carrying water from a well using a bucket with a big hole in it; the leakier the bucket, the more water we will waste in trying to share it around. Okun described equality and efficiency as “the big trade-off”.

If........

© The Sydney Morning Herald