Unions say NO to GST rise
The union movement is gearing up to oppose changes to Australia’s taxation system that would leave working people worse off.
The move comes in response to the revival of the Goods and Services Tax (GST) debate by the Turnbull government. The Coalition is clearly preparing the ground for an increase in both the level and the scope of the tax.
The GST is a regressive tax i.e. it involves everyone paying the same tax rate (in this case on goods and services purchased/used) irrespective of their capacity to pay. Income taxes, in comparison, are progressive because they are tailored to the level of earnings.
ACTU President Ged Kearney said an expanded GST would hit middle and lower income earners while leaving corporate giants untouched. The result would be increased inequality in the tax system.
The ACTU says that if the government is as genuine about tackling the tax system as it says it is then the reform must include current corporate tax minimization methods which cost the nation billions of dollars.
And high income earners should also be made to pay their fair share of tax.
In 2011/12, there were 75 Australians who earned more than $1 million and yet declared an average taxable income of only $1.09 by taking advantage of complicated tax minimisation strategies.
High earners are also disproportionately advantaged by other tax loopholes as well. For example:
- Half of all negative gearing tax breaks go to the top 20% of high income earners.
- Almost 75% of Capital Gains Tax breaks go to the top 10% of income earners
- A third of superannuation tax breaks go to the top 10% of income earners
“We need a broad approach to tax reform that ensures everyone pays their fair share, we don’t need a GST hike, we need a fairer tax system,” Ms. Kearney said.
