TONY ABBOTT has delivered a strong message to colleagues pushing for a change in the GST: it won’t be happening anytime soon. Speaking in the Middle East, the Prime Minister insisted there “will be no changes to the GST in the first term of the Coalition Government” and there are currently “no plans” to tinker with it.
This was eerily reminiscent of his comments in February about a GP co-payment
“Nothing is being considered; nothing has been proposed; nothing is planned,” Abbott said. “I think I have knocked the scare campaign on the head. This is all the Labor party has got. Nationally or locally all they’ve got is a scare campaign and I think that the people of Griffith and the people of Australia are bigger than that.”
It seems apparent that we are being prepared for a change to the GST. Whether it will be increased, or the base broadened, or both, remains to be seen but it is coming, regardless of Tony Abbott’s assurances of “there will be no change to the GST.” We know how much his word is worth.
Broadening the base to include fresh food, health and education would hit low income earners hardest so, considering the statistics about poverty in Australia, other alternatives should be considered.
Recently I suggested that we could have a differential GST where luxury items attracted a higher rate. Pappinbarra Fox rightly pointed out the logistical and administrative problems with this idea.
On another thread, Carol Taylor made the following suggestion:
“In a user-pays world cease all funding for all things ‘private’ such as schools and health care. If anyone wants something more than what the public purse can afford, then they should pay for it themselves. Likelihood: zero.”
This reminded me of my father, a public school teacher, who, whilst lamenting private school funding, would say “We have a public transport system. If they choose not to use it does that mean we should buy them a car?”
Whilst we may not be able to go so far as stopping funding private schools, I was interested to read the latest research from the Australia Institute which suggests that broadening GST to include private school fees and private health insurance could reap $2.3bn a year predominantly from well-off households.
Modelling done for the institute by the National Centre for Social and Economic Modelling (Natsem) found only 9% of the $2.3bn a year raised by the extension would come from the poorest 20% of households, 34% would come from the richest 20% of households, and 60% of the revenue from the richest 40%.
The move would also shield rural and regional areas, with 71% of the revenue raised from capital cities.
Increasing the GST seems the lazy option to me. Businesses bear the brunt of repricing all stock and reprogramming tills, collecting the money, accounting for it and passing it on. Business Activity Statements are basically privatising the tax office with no recompense for the hours spent collating all the paperwork to complete them.
If you are looking for an easy way to find $50 billion dollars why not cancel our order for 58 fighter jets that may or may not be ready sometime next decade and what on earth do we need 12 new submarines for?
Cutting back on hosting $50,000 dinners all around the world would also make the “end of the age of entitlement” sound a little less hypocritical. Don’t you people have offices you can meet in during business hours?
Stop always looking to hit the poor, the weak, the vulnerable. Stop telling us there is no choice – we know better.
“If you care about other people, that’s now a very dangerous idea. If you care about other people, you might try to organize to undermine power and authority. That’s not going to happen if you care only about yourself. Maybe you can become rich, but you don’t care whether other people’s kids can go to school, or can afford food to eat, or things like that. In the United States, that’s called “libertarian” for some wild reason. I mean, it’s actually highly authoritarian, but that doctrine is extremely important for power systems as a way of atomizing and undermining the public.”
– Noam Chomsky “Business Elites Are Waging a Brutal Class War in America”.
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