Prominent investor, Mark Carnegie, has labelled the Abbott Government’s upcoming White Paper on tax a waste of time, arguing that the Henry Tax Review has already outlined what needs to be done, and all that is required is a government with the courage to implement its recommendations:
For Mr Carnegie, what needs to be done was largely fleshed out in the Henry tax review…The clear exception was the GST, which the Henry panel was not allowed to consider.
Mr Carnegie said the consumption tax should rise to 15 per cent but only with a carefully devised compensation package to protect the poor…
Land tax is the second big issue for Mr Carnegie…
“We really need a carbon tax – that debate has been asked and answered…
Negative gearing and trusts are among the areas that could be tapped to help claw back tax from the rich.
“Tax needs to fall disproportionately on the rich – everyone agrees on that now,” he said…
Meanwhile, Fairfax’s Peter Martin has warned today that the stalling of the Tax White Paper’s release from December 2014 to end-March 2015 has materially damaged prospects for reform:
After the discussion paper was to come months of consultation and submissions ahead of a final paper at the end of this year. Unless Hockey extends the deadline, the process will have been severely truncated. If he does extend it, the white paper will be released so close to the next election as to make a bold second package impossible…
Like Martin, I have very low expectations that the Tax White Paper will deliver anything meaningful. Joe Hockey admitted as much last week on Q&A when he defended superannuation concessions that benefit the rich as ““their money. I’m always cautious about taking their money away from them”. His staunch defence of negative gearing and repeating of the myth that rents surged last time around (between 1985 and 1987) also highlighted that we should not expect reform in this area.
As Carnegie suggests, we all know what needs to be done: tax lurks for the wealthy need to be closed and taxation needs to be shifted to efficient sources, including consumption and land (including resources).
Much like the numerous inquiries into housing affordability, the Tax White Paper looks like an attempt to delay decisions on reform until the never-never.
