Australia needs to move to a more modern, sensible mix of taxes that will best promote the wellbeing of the Australian community and support the creation of jobs for the future. It’s not about one tax. It’s about the combination of taxes and the capacity of the overall tax system to influence decisions that will achieve the goal of growing the economy and creating jobs. For example, any changes to the GST should only be considered against the backdrop of broader-based tax reform and not in isolation. Any changes to the taxation of superannuation, for example, must be consistent with the objectives of retirement income policy: reducing reliance on the age pension and providing comfortable retirement incomes.
The overarching objective of tax reform over the medium term must be to redesign and improve the tax system by shifting from less efficient taxes to more efficient ones, so that the average economic burden of raising each dollar of revenue falls. This requires a tax package that overall reduces the tax burden on investment, working and other highly valuable and productive activities.
While a tax system that promotes economic growth must be the primary objective of reform, the tax system as a whole must also be equitable, have integrity, provide a stable revenue base and be as simple as possible.