LEADERS’ RETREAT DISCUSSING ‘TAX REFORM’; BUT IS IT REFORM?

Increasing the GST is easy.

You’ve just got to get it past a couple of half-hearted, nay-saying State premiers, because ill-informed people believe it’s an answer to Australia’s budgetary problems.

It’s regressive: people who have no capacity to save will spend a greater proportion of their net incomes on it.

It isn’t real reform: it’s just more tax, adding further to Australia’s deadweight costs.

Land ‘tax’ reform is hard ….

…. because there is so much ignorance on the subject.

However, every study shows it to be the most efficient, encouraging economic growth, discouraging property speculation, and having no deadweight – because it’s an economic rent, not an arbitrary tax.

Let’s hope ignorance on the benefits of reformed land-based revenues can be overcome, and we don’t end up with an increased GST which, although it may raise extra revenue, will not encourage growth nor diminish Australia’s taxation deadweight costs one iota.

[See also Prosper Australia post today.]