The release of the MYEFO is a timely reminder that tax reform is essential if the structural problems that Australia currently faces are to be fixed, the IPA said.
IPA chief executive officer, Andrew Conway o amount of cost-cutting will fix the budget but rather a balanced, holistic view is needed, looking at both the revenue and expenditure sides of the ledger, including maintaining an optimal tax to GDP ratio.
“Therefore, a mature debate on tax reform is urgently needed,” he said.
“The promised tax white paper cannot come quickly enough if we are to get the economy back on track and tax reform represents one of the most effective levers that the government has at its disposal to reinvigorate economic growth.”
“This will go a long way in addressing Australia’s productivity crisis.”
According to My Conway, the Henry Review, published in 2010, was “hamstrung” by the decision not to allow GST to be included in the terms of reference. True tax reform, he said, needs to consider the whole picture, not just segments.
“Australia is currently shackled with a plethora of inefficient and regressive taxes which is stifling growth.
“It’s surely time to review this position, have the tax reform debate and get the tax mix right that will support business productivity and competitiveness,” Mr Conway said.