A Tax Odyssey
For five minutes last night I had the pleasure of sharing a glass of red with guest of honour John Freebairn before Grattan Institute’s Danielle Wood delivered “Tax reform in Australia: an impossible dream?” for the 2023 Freebairn Public Lecture at the University of Melbourne.
I reminded John that I’d spoken with him at a Prosper Australia-Centre for Public Policy joint symposium in 2005 at the University. He’d also delivered a well-received 123rd Henry George Commemoration Dinner Address in September 2014.
A colleague in our group mentioned to John that at that this year’s 131st Henry George Address he’d assisted Ross Garnaut up the stairs of the venue because Ross had just that day broken his leg! That was some commitment, Ross!
Danielle Wood’s address on the need for tax reform proved to be brilliant and thoroughgoing. It laid out clearly what Australia requires so urgently. If the media gives her a chance, Danielle Wood is going to make an excellent Head of the Productivity Commission.
Australia has a rotten tax regime. That’s the way banking, mining, real estate and super profit-seeking monopolies want it. We may shift the emphasis from incomes to purchases, or reverse that process from time to time, but that’s the only ‘tax reform’ permitted. A media beholden to well-funded rent-seeking interests will damn any proposal for a tax-shift from the status quo towards greater capture of our natural resource rents.
This flawed tax system encourages many Australians into spec where they’re better served than they are working to create real wealth. We’ve become wedded, if not welded.
I was first alerted to the tax system’s failings in the 1970s when part of the Australian Taxation Office in which I worked in the Prudential Building at the corner of Bourke and Queen Streets Melbourne was re-located into a new building at 270 King Street, where Mainline Corporation, Australia’s biggest office builder, had just gone broke.
I was completing my real estate valuation course at RMIT at the time, and the Mainline collapse heralded and came to characterise Australia’s property bubble-burst. I came to see the link between the tax regime, the property bubble and the 1974-75 recession.
The time of the 1975 Aspery Tax Review was a little premature for me to be involved, but when the Hawke government was about to hold its 1985 Tax Summit, I had the temerity to suggest to my professional body, the Australian Institute of Valuers, that it should have input to the Summit in favour of an all-in land tax. That went well!
As a member of Prosper Australia’s Land Values Research Group, I also took part in the 1996 ACOSS-ACCI Tax Summit with Phil Day, Town Planner Head, Department of Regional & Town Planning at the University of Queensland, to speak to our paper in favour of a land tax.
The purpose of the Summit was obviously to provide an imprimatur for a federal charge upon purchases. This was indeed the outcome, although the communique did allude to strong support at the Summit for an all-in land tax.
As a member of the executive committee of Prosper Australia, my odyssey for public recapture of Australia’s net product, our economic rent, from rent-seekers continues.
Danielle Wood’s contribution last night was most impressive. It merits a thoughtful hearing from a too-often blinded mainstream media. How to get over that particular stumbling block if we’re to have genuine tax reform?