Taxing times

When is the government going to take on the kind of systemic tax reform that literally everyone knows is needed?

It has been quite a day for Anthony Albanese. After this morning announcing his engagement to partner Jodie Haydon, the PM then took his turn boasting about Labor’s Stage Three tax reforms in the House of Representatives, crowing about how every Australian will now get a tax cut. The changes passed the House an hour later, but not before the Opposition tried to move some “amendments”. This turned out to be merely an attempt to change the bill’s title, from “Treasury Laws Amendment (Cost of Living Tax Cuts) Bill” to the Coalition’s proposed “Treasury Laws Amendment (Broken Promise) Act”. Labor has the right to be pleased with itself: it successfully counter-wedged the Coalition, which absolutely hates the more equitable cuts but nonetheless voted for them. But Albanese’s gloating begs some questions. If this was such a great idea, why didn’t his government do it sooner? And when, if ever, will parliament be up for addressing the kind of systemic tax reform that top economists say is necessary?

This week, not one, not two, but three of Australia’s most highly respected former public servants are calling on the government to do something about our tax system. Yesterday, it was Ross Garnaut, a leading economist during the Hawke government, and Rod Sims, recent chair of the Australian Competition and Consumer Commission, who joined forces to press for a fossil fuel production tax to be put back on the table. Such a tax, they argue, could generate $100 billion in its first year alone and fund Australia’s transition to becoming a carbon-free energy giant, while also helping with the cost of living. “We don’t have the debates that we should have,” a frustrated Sims lamented to the National Press Club. “We let the debates drop too quickly. We need to have this debate.”

Unfortunately for Sims and Garnaut, Treasurer Jim Chalmers was all too keen to let this one drop, rejecting the idea when asked about it by teal independent Sophie Scamps in yesterday’s Question Time. “Mr Speaker, I agree that Prof Sims and Prof Garnaut are very distinguished economists and thinkers and they are well motivated and informed contributors to this debate,” the treasurer began, before going on to say that he “differed” when it came to the idea of a levy, because Labor had “found a better way”.

Given that response, it’s unlikely that former Treasury secretary Ken Henry is going to have much more luck. Henry, the last person to do a root-and-branch review of the tax system, is today warning that young people are going to pay the price for the intergenerational unfairness that has become embedded in the system. Henry was critical of how the Stage Three tweaks had been done, arguing that current pressures are the result of a lack of genuine reform. “You do not do tax reform based on pandering to people’s concerns about immediate cost-of-living pressure,” he told the ABC. “You should be worried about the cost-of-living pressure in five years, 10 years, 20 years – the poor bastards who are going to have to pick up the bloody cost of all of our stuffing around.” Indeed.

The Greens, who have long been arguing that property taxes are in need of reform, will have been pleased to see Henry giving negative gearing and capital gains tax concessions another mention. As the Australia Institute’s Greg Jericho writes today, such policies are actually a “tax minimisation policy disguised as housing policy” – they were designed by John Howard to increase house prices and reduce affordability (they’re working). The Albanese government, however, is stonewalling on the Greens’ demands and steadfastly ignoring the advice of our top economists, unwilling to do anything that doesn’t result in tax cuts for everyone.

“This will be the time for all of us to take a stand … to stand with Julian Assange, stand for the principles of justice, stand for the principles of media freedom and the rights of journalists to do their jobs.”

Independent MP Andrew Wilkie speaks to his motion calling on the US and UK to end the prosecution of WikiLeaks co-founder Julian Assange. The government voted for the motion, in what Wilkie called “an unprecedented show of political support”, but the Coalition did not, despite some members having previously called for Assange’s release.

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Shadow Indigenous Australians minister Jacinta Nampijinpa Price says Labor must ditch the remaining elements of the Uluru Statement from the Heart, and instead conduct an audit of spending. As was pointed out during the Voice referendum, audits are regularly conducted in this space – including 22 under the previous Coalition government.


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