Malcolm Turnbull’s short-lived state income tax plan is looking a lot like a tactic to recast the central debate of the 2016 election campaign – does Australia need to raise more revenue?  Facing the final reckoning for Tony Abbott’s 2014 budget decision to cut $80bn from projected forward spending on hospitals and schools, and the inevitable blame from state premiers for not stumping up the cash, he grasped for a high-risk strategy to reframe the conversation.  Related: Turnbull's schools and hospitals plan won't work unless taxes go up | Lenore Taylor  “If you think we need to raise taxes to pay for services, then you do it,” he effectively dared the states. “We’ll hand over the power.”  In the unlikely event they had agreed he had an answer to every election campaign question about hospitals and schools funding: “That will be a decision for the states.” And, in the far more likely event that they didn’t, he could say exactly what he has been saying all weekend: “Don’t come to the commonwealth asking for more money when you weren’t prepared to even think about putting taxes up yourselves … Now the ball is back in your court.”  His tactic was couched in the language of “ending the blame game” but was actually calculated to give him a means of shifting, or at least sharing, the blame.  Which means, of course, it provides no answer at all to the question of where Australia finds the necessary money to pay for schools and hospitals. Even if the shortfall isn’t $80bn, it is significant, in the opinion of all the premiers, and well beyond what might be found through “efficiencies” and “stretching dollars further”.  The Coalition’s answer is that they are hoping to increase economic growth. If they get more tax revenue from changes to the tax concessions for superannuation and the like, then they’ll return it in gradual cuts to company tax because, theoretically, that will boost growth. The services we get will be whatever we can pay for by spending wisely.  Related: Turnbull's plan to end tax blame game threatens to break Morrison's budget pledge  The Coalition’s calculation is that we have a spending problem, and only a spending problem. Their only possible response to the immediate fiscal gap can be spending cuts because they will not increase the overall burden of taxation. That is exactly the same strategy that Abbott tried.  Labor’s answer is that we have both a spending and a revenue problem. When they get more revenue from changes to superannuation tax concessions and negative gearing, they’ll spend much of it on hospitals and schools.  That’s an easier political argument to make in an election campaign, especially if backed by the states.  Perhaps that’s why Turnbull took such political risks to change the terms and tone of the conversation.  • Lenore Taylor will be on the panel at Quarter Time – a topical Guardian Live event featuring Dom Knight from the ABC, Adam Creighton from the Australian and Guardian Australia’s Bridie Jabour on 14 April in Sydney.
The prime minister’s high-risk strategy aimed to reframe the debate about revenue but left states with no new answers