The Coalition can try to 'sell' a GST increase, but Australians won't buy it
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Version 0 of 1. It’s little wonder that attempts to make Australia’s taxation system more unfair have emerged as one of Malcolm Turnbull’s early prime ministerial priorities. In his victorious spill night speech, Turnbull’s pledge to govern “for freedom, the individual and the market” made it explicit that mechanisms to advance the unmentioned “public good”, “community” or, God help us, “the people” were of zero immediate interest. Related: Raising GST to 15% 'will cost poorest families 7% of disposable income' So it’s barely November and the Coalition have a new leader but no new tactics, let alone ideas. With dreary inevitability, they’re talking tax reform. A suitable stalking horse – David Gillespie MP (um, who?) – has been trotted out to suggest a NZ-style overhaul of the tax system that would apply an increased GST to food, health, education and probably the air we breathe, should the government finally manage to privatise it. The “tax reform” strategy is, as usual, to propose something so preposterous amongst a clutch of other dreadful options that what the government really wants – the increase of the GST to 15% with a packet of tax cuts to rich people – can, with a gentle pucker of the treasurer’s mouth, be presented as a palatable compromise. Indeed, Scott Morrison has already “stressed [Gillespie’s] idea is not official policy” although all ideas are “on the table”. Nobody should get comfortable. The Coalition’s radical economic agenda – that came to be in Abbott government documents like the post-election Commission of Audit and disastrous 2014 Budget – didn’t start as “official” policy, either. This is because Australians will not vote for economic policies they know to be unfair, so the Coalition can’t be too explicit about it – like Abbott and Hockey were – or they’re toast. Turnbull appears to believe he can deliver the radical economic outcomes Abbott couldn’t if his team – that same Coalition team – just delivers a better sales pitch. He said as much himself in that mightily revealing spill night speech. The Coalition’s hucksters are at least explicit about this part of their strategy. For Turnbull’s tilt at a GST increase, Arthur Sinodinos, newly-resurrected, claimed urgency was needed to “sell a story to the Australian people”. The AFR reports that communications minister Mitch Fifield “said selling the changes to Australia would nearly be as important as the changes themselves”. But Australians are right to question just why this particular “reform” is the one preferred by Turnbull. He could instead address revenue gouging created by multinational tax avoidance, domestic tax evasion, superannuation tax concessions, diesel fuel rebates and negative gearing. He could establish a common-sense Buffett Rule, or, you know, simply increase the Medicare Levy. He’s not going to. For all their colourful antics the Coalition remains an assortment of pro-business and propertied neoliberals, neoconservatives, neocon-libs, neo-lib-cons and petrified single-minded recalcitrants. Protecting the wealthy is, as always, the real agenda of the Coalition’s taxation “reform”, because – and this may surprise those Australians who have already had their pensions cut, or their services cancelled, or are living in terror of higher medical or education fees - apparently, it’s not about raising revenue. Hockey insisted there was a “budget crisis” to justify spending cuts – but now assistant treasurer Kelly O’Dwyer’s assures that an increased GST is about “improving the overall tax intake and not increasing it”. The sales claim from the Coalition is for “improving economic efficiency” because to claim that increasing the notoriously regressive GST is fair is not true. As modelling this week from the Australian Council of Social Services showed, increasing the GST to 15% would cost the poorest Australian families an extra 7% of their disposable income. It would cost the richest families only an additional 3.6% . In an Australia where wages are not keeping pace with productivity, unemployment is rising, labour casualisation is increasing and two years of Coalition government have coincided with a surge in wealth inequality, proposing to raise the GST is nothing short of shameful. |