Peter Costello made it clear this week he’d love to cut taxes: “Is a politician in favour of cutting tax? Is a farmer in favour of rain?” he reminded everyone on Wednesday:

So why doesn’t he? Particularly with record tax inflows filling the Treasury to bursting point, and tax crusader Malcolm Turnbull leading a national reform agenda. Turnbull’s campaign continues in today’s media: here and here.

The simple answer is that Treasury won’t let him. Costello blew the chance for comprehensive income tax reform coinciding with the introduction of the GST’s rivers of gold in 2000 – on Treasury’s advice.

Last year’s Budget tax adjustments were a step in the right direction; but that’s when the politics of personal ambition kick in. The most compelling reason Costello is sitting on his hands while the political classes talk tax reform is this: as long as John Howard is Prime Minister, Peter Costello will never comprehensively reform the nation’s income tax system.

Sure, Costello badly wants to reform tax; but he wants to do it on his terms. Costello is no longer interested in enhancing Howard’s legacy – as he’s made clear by jetting off next week to Indonesia with a plane load of journalists, snubbing Prime Minister and Parliament.

His childish reaction to Turnbull’s ideas this week betrays the deep frustration of a Treasurer who regards himself as a true tax reformer courtesy of the GST – but is determined to do nothing about it, for now.

But mark this down: Costello’s first Budget – maybe earlier, his first major announcement – as Prime Minister will be to announce sweeping reform of the tax system. Tax cuts all round; the top rate slashed; a redistribution of the base he so loudly brays is impossible; a fistful of dollars for everyone. In the meantime, Costello will continue playing Treasury’s dead hand.