GST last in federation debate: Hockey

Treasurer Joe Hockey says talk of changing the GST is premature.

A GST component printed on a receipt

State premiers have poured cold water on Tony Abbott's call for a mature discussion on the GST. (AAP)

Treasurer Joe Hockey believes people are getting ahead of the game talking about the need for changes to the GST.

Recent speeches by Prime Minister Tony Abbott have encouraged people to engage in a debate about the state of the federation and how it should be better structured.

It has prompted a renewed bout of speculation that the base of the GST may have to be broadened or the rate increased, or both, to help the states cope with additional responsibilities.

Mr Hockey, launching a new productivity report by Deloitte in Canberra, said the last position should be to increase the tax.

"When you work out who does what, who has full responsibility for what particular area of servicing the community, then you work out how much money you need," he said.

"Too many people are focusing on the tail of the horse than the head."

Deloitte Access Economics economist Chris Richardson said the GST has long been known as an efficient tax but it could be better.

It could cover more things to raise more revenue or the rate could be increased to replace a bunch of "deadweight taxes".

The rate of the GST has been 10 per cent since it was introduced in 2000, as has exemptions covering fresh food, health and education.

Recommendations from the government's federation and taxation white papers will be released in the run-up to the 2016 election.


Share

2 min read

Published

Updated


Share this with family and friends


Get SBS News daily and direct to your Inbox

Sign up now for the latest news from Australia and around the world direct to your inbox.

By subscribing, you agree to SBS’s terms of service and privacy policy including receiving email updates from SBS.

Download our apps
SBS News
SBS Audio
SBS On Demand

Listen to our podcasts
An overview of the day's top stories from SBS News
Interviews and feature reports from SBS News
Your daily ten minute finance and business news wrap with SBS Finance Editor Ricardo Gonçalves.
A daily five minute news wrap for English learners and people with disability
Get the latest with our News podcasts on your favourite podcast apps.

Watch on SBS
SBS World News

SBS World News

Take a global view with Australia's most comprehensive world news service
Watch the latest news videos from Australia and across the world