New South Wales Premier Nathan Rees says he will not be raising taxes to fix the state’s economic woes, but has labelled government departments “absolutely ripe for reform”. Mr Rees’s new cabinet team will tomorrow be briefed on the grim economic outlook that has put the state’s triple-A credit rating at risk.

This week saw big problems emerge for the Labor Party in New South Wales and Western Australia, while federally the Nationals shrank even further with the loss of Lyne. In the Senate, Steve Fielding voted down the luxury car tax increase, while in the United States, Sarah Palin has garnered an immediate and positive reaction.

Representative Charles B. Rangel, the chairman of the House Ways and Means Committee, which writes the federal tax code, bought the beachfront villa at the Punta Cana Yacht Club and has received twice-yearly payments from the resort, which rents the property for $500 or more per night.

For the first time in months, the Prime Minister spoke on budget measures without referring to a “cheat sheet” of budget facts and delivered telling political lines without bureaucratic jargon. Instead of “prosecuting a process of economic responsibility”, Rudd whacked the Coalition for backing “Porsche drivers” instead of working families.

Family First senator Steve Fielding sided with the Coalition this morning to vote down the increase in the luxury car tax at the second reading, 34 votes to 33. Senator Fielding had wanted to exempt farmers and those in the tourism industry who use cars, worth more than the tax threshold of $57,180, as tools of trade.

Kevin Rudd is determined to be different, to live up to his promise of being a fresh politician who not only has new ideas but also sticks to what he says. What’s more, he is not just making this comparison with John Howard and the previous government.

While shadow cabinet has resolved to block the tax, the Opposition Leader’s office is refusing to release details until after tomorrow’s partyroom meeting. But senior Liberals said today that Woodside’s warning the tax may have to be passed on to consumers “strengthened the arm” of its critics.

Not only is Brendan Nelson advocating big budget cuts, he is proposing the spending of billions more on pensions. Every time, however, he attacks the Rudd Government for dudding pensioners, he is indirectly accusing the Howard government of intending to do the very same thing, simply because Labor pilfered John Howard’s $4 billion pensioner policy during the last election campaign, embellished it a little, and then implemented in it full in the budget.

Woodside Petroleum’s Chief Financial Officer Mark Chatterji said today that the oil and gas giant cannot simply absorb the cost of the Rudd Government’s proposed $2.5 billion new tax on condensate. “In order to stay competitive, businesses seek to pass cost increases on to their customers,” he said in a statement.

The Opposition Leader said that the Coalition’s “natural disposition” was to support anything that would reduce the harm associated with drug and alcohol abuse. “But having examined the evidence which led to this particular budget initiative, we have made a decision that we will not be supporting the excise increase,” he said today.