Finance Minister Mathias Cormann says he wants to cap tax revenue.
There are many potential reforms to the tax system that are revenue neutral, from broadening the tax base to replacing transaction taxes.
Fresh fruit and vegetables are currently exempt from GST for equity reasons, but it’s time for a rethink.
Simply increasing the GST rate would make for poor tax design. Instead, the government should broaden the base and lock in compensation measures.
History tells us it’s better for countries to get their GST right to start with, rather than try to broaden the base later.
Value added tax (VAT), virtually non-existent before 1960, has been the predominant form of consumption tax since the mid-1980s. Given that more than 160 countries now have a VAT, it is hardly surprising…