Treasurer Scott Morrison’s first National Press Club address exposed the Government’s blind spot on genuine tax reform and reinforced the impression the Government does not have the stomach to go after wasteful tax breaks and exemptions for the super wealthy.
“Mr Morrison failed to address the most obvious tax reform options which tackle spending – capital gains exemptions, negative gearing, superannuation tax concessions, and corporate tax avoidance,” said Ged Kearney, President of the Australian Council of Trade Unions.
“The Treasurer’s insistence on the need for more corporate tax cuts is put forward under a vague notion that modest tax reduction can drive of innovation and productivity. The reality is that education and infrastructure investment contribute far more significantly to innovation and productivity growth – both areas where the government is cutting funding.
“We have no hope for meaningful tax reform if the Government continues to turn a blind eye to the most obvious opportunities available.
“The Government cannot afford to shy away from real revenue raising initiatives like Labor’s negative gearing policy and capital gains tax exemptions.
“If the Government is to fund the services Australians need, then corporate tax minimisation must be tackled head-on. We know 38 percent of the 1539 largest public and foreign companies operating in Australia paid zero tax.
“But it is clear the Government is hamstrung by politics and listening to vested interests in the corporate Australia – especially the property sector, rather than the facts that are on the table.”
Ms Kearney said Australians pay taxes so we can have good health and education systems, good infrastructure and good opportunities.
“If the Government wants to ignore negative gearing, capital gains tax exemptions, but still put the break on spending, this does not bode well for education, health, disability and other services that working Australians rely on.”
Ms Kearney said Australia does have a revenue problem, but it is not that we don’t pay enough, it’s that our tax base relies too heavily on low and middle income earners who can least afford to do the heavy lifting required to balance the budget.
“While the Treasurer belittled the contribution of the majority of low and middle income Australians to the tax base today, the fact is when you take account of all taxes, like the GST, low income households pay 24 per cent in tax and high income earners 28 per cent.
“The notion that big corporates and the super wealthy already pay their fair share of tax is false – they benefit from excessive loopholes, tax exemptions and handouts. It is time that these were removed so that we can afford to fund the services in education and other areas which Australians need, and which actually drive innovation and productivity growth.”
Media contact: Tim O’Halloran 0409 059 617