Business Day’s Michael Pascoe has written an excellent article this afternoon arguing that the states must unite in order to drive GST reform:
Barnett called for leadership on the GST issue from Tony Abbott, but it’s not the federal government that needs tax reform, let alone the political cost of broken promises and scare campaigns. The “leadership” is going to have to come from those who most urgently require it – the states. Only when the states unite in demanding change will Abbott be able to wash his hands of it, pointing out as his treasurer already has that the GST is the states’ tax merely administered by the commonwealth…
[The states have]…trashed their own tax bases and show little inclination to take politically unpopular decisions to fix their inequitable and damaging revenue sources, but they’re all facing soaring health, education and infrastructure needs. Which is why it has been argued here before that we’ll only get serious about changing the system when the states demand it…
The bigger and more beneficial potential reform that’s already in the states’ own hands is to move from reliance on economically and socially damaging real-estate stamp duty to a broad land tax without exceptions…