This video discusses the urgent need for tax reform, given the likelihood of shrinking revenue and, ultimately, permanent deficits if current government revenue to GDP and current entitlements are maintained. In addition, Australia’s tax system is, in many respects, seen as seriously distorting. In the presenters view, reform of our tax system will consist of several major components. The first is that we must move towards a tax structure that has more sensible tax bases and taxes those bases in a more sensible way. The second component involves tackling our dysfunctional system of fiscal federalism. Finally, we must consider the sustainability of entitlements and how to fund them into the future. The presenter then discusses how such reforms may be achieved, and recommends an independent fiscal commission that reports annually to government.
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The inefficiencies in and distrortions caused by our tax system
Author(s): Henry Ergas