shopping_cart

Your shopping cart is empty

Budget should not miss the boat on tax reform

Publication date: 21 Apr 16 | Source: THE TAX INSTITUTE

21 April 2016 - The Tax Institute is urging the Federal Government to use the 2016 Budget to unveil plans for meaningful tax reform that will stimulate productivity and drive Australia’s economic growth. 

The government brought relief to small business last year and promised tax incentives for early stage investors in its innovation statement, however the current tax debate has become redundant despite the government previously committing to holistic tax reform. 

While the signs are not optimistic for significant structural tax initiatives in the 3 May Budget, the government should not miss the boat on genuine tax reform. That means the government taking action to shift Australia’s dependence on income tax to more simple and efficient consumption taxes.

The Tax Institute's president, Arthur Athanasiou said: "If we are to ensure our tax system is fair, simple, efficient and sustainable, we must get the Tax Reform White Paper process out of dry-dock. It'd be a national shame if we missed the boat on tax reform in the 2016 Budget.

“The government must take the opportunity to flag better policy than its recent idea to let the states and territories levy income tax. Shifting from the current heavy dependence on individual and corporate income tax towards more efficient consumption taxes will create a simpler tax system to implement and regulate while providing the government with more sustainable revenue collections.

“The government must determine the appropriate tax mix for Australia to provide sustainable revenue to meet future government spending promises. To do that, it must commit to review issues surrounding individual tax, superannuation, general business and small business tax, not-for-profit sector tax, GST, state taxes, and the complexity, administration and governance of the tax system.”

The Tax Institute believes 2016 Budget priorities should include: 

  • reducing company tax to 25%;
  • abolishing the ‘10% rule’ limiting superannuation contributions to self-employed Australians;
  • reforming superannuation laws that benefit the small wealthy minority that see superannuation as a wealth and estate planning vehicle rather than providing reasonable benefits for retirees;
  • continuing deregulation initiatives and publishing regulation impact statements for each reform;
  • concentrating on internationally co-ordinated efforts to address base erosion and profit shifting (BEPS) rather than introducing new Budget measures on multinational taxation; and
  • increasing digital resources at the Australian Taxation Office to improve inefficient systems.

ENDS 

For more information contact:

John Hanrahan, Lighthouse Communications Group, 0411 212 965

Stephanie Conway, The Tax Institute: 02 8223 0011 

The Tax Institute is the country’s leading professional association and educator in tax. Its 12,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia. The Tax Institute supports the tax profession through education and professional development and works to continually improve tax law and its administration.