RAMSHACKLE G.S.T. WILL DO NOTHING FOR EMPLOYMENT
When in May 1998, the Government announced it would go to an election with a G.S.T. [Goods and Services Tax] as its policy centre-piece, the Leader of the Opposition [Mr Kim Beazley] was quick to indicate that, if defeated at the election, he would torpedo the Government’s Tax Package in the Senate.
The Sydney Morning Herald, in its editorial of May 16 classified the statement as "an act of political and constitutional thuggery" and further, "it is an attempt, moreover, to condemn Australia to a third-rate tax system for the foreseeable future".
"A window of opportunity"
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The Herald then suggests that if the [Labor Party] Opposition should succeed, "the result will be that the present ramshackle and inequitable system will be maintained and made increasingly inequitable for PAYE [Pay As You Earn] taxpayers."
The expensive media campaign to sell GST carried the foot-note clearly referring to GST "Not a new tax. A new tax system". This of course is obvious misrepresentation.
Since we have never had a GST it is definitely a new tax. Secondly, to replace some bad sales taxes with the proceeds of an equally bad GST is to leave in place the majority of the present "inequitable and ramshackle" taxes referred to even by the Prime Minister [Mr John Howard] as "Rotten".
This certainly is not a new system and is not reform.
When public pressure is to simplify the tax structure, GST offers only a new tax with an extraordinary burden of additional administrative work on trade and commerce.
GST cannot be applied equitably across the entire spectrum of income diversity. It will do nothing for employment.
The Prime Minister, having linked the new tax to the additional provision for Health, Education and Social benefits, is clearly looking for increased revenue from it.
Perhaps the statement which ought to galvanise us into action is that of the Treasurer who pointed out that this is the first "reform" in a century and it may be another century before we have another chance.
It could be good news that we may not have a GST or its implementation may be considerably delayed because of the inevitable period of political instability which lies ahead.
So, with tax reform in the air and the widespread condemnation of the present system, this surely presents a window of opportunity to insinuate into the public debate the benefits of that best of all broad tax bases the land.
We should apply all the influence we can muster to promote that as a real tax reform beneficial to all, if we are not to lapse back into the "inequitable, ramshackle, rotten" taxes under which the country and ourselves suffer.
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22 May 1999, last revised with
04 Oct 03
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