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Federal Budget Insights

Calling for holistic tax reform

Steve Healey, CTA (Life)

Past President, The Tax Institute

Director – Tax Services, RSM Australia

Transcript, 14 March 2019: Comments on the upcoming Federal Budget 2019-20

STEVE HEALEY: I think the Federal Budget gives the government the opportunity to address some significant issues, and no doubt we're going to see a pre-election budget. There's no doubt about that whatsoever. We've already seen a number of measures from the opposition. A lot of those, I'd look at in terms of piecemeal tax reform.

What we'd like to see is holistic tax reform, and that means going a lot further than just taking populist policies designed to win short term political capital, and focus on the long-term future of the country.

I think one of the things that's incumbent on our government is to really look at what our country will need in 2050, wind the clock back, and see what we really should be doing now. That means doing a whole lot more than just cherry-picking pieces for tax reform, looking at the franking credit debate that's going on at the moment. We do need to look at that as part of a holistic tax reform process, but not in isolation in terms of what is short term political opportunism. Rather as the Henry Review of 2010 sets out, we need to look at a whole lot of different aspects of tax reform of the entire tax system.

The opportunity the federal budget gives every year, is it gives the government the opportunity to do just that, to actually look at what's in the best interests of the country and to put measures in place that will meet those interests as well.

In its mid-year economic and fiscal outlook, the government is projecting a return to surplus in 2019-2020. That will mean that we've got funding for additional infrastructure and new political initiatives.

It will also give us the opportunity, once again, to focus on real tax reform. As I said earlier, that real tax reform is desperately needed if we are to fund the future of this country.