Advice from the past for reformers

In dealing with both an expenditure blowout and falling income growth, our senior Treasury ranks, controlled by theoretical specialists, are supplying little assistance to the government in stabilizing the books. Treasury employer Martin Parkinson’s discovery of the requirement for expanding the GST base highlights just how insufficient their current support has been.

How times have changed. Almost 40 years ago, Treasury deputy secretary John Stone vehemently opposed Bill Hayden’s action enhancing the yearly individual income tax threshold to just over $1000. Stone was attacking a campaign, supported by Nugget Coombs and tax commissioner Ted Cain, that was developed to remove even more than 500,000 age-pensioners from the ranks of taxpayers, as well as attempting to ensure the tax gathered went beyond the expenses of doing so. Stone fought hard to safeguard tax collections, a task that he made sure Treasury carried out to its finest capability via the Asprey Tax Review. Treasury submitted and released 15 documents covering all aspects of the tax system, making sure the committee and public were informed of its view.

Ratchet forward in time to the Rudd government’s Henry tax testimonial. By accepting chairmanship when the regards to reference eliminated a review of the GST and other crucial products, Ken Henry negated any opportunity of a longoverdue Treasury testimonial of our tax system. This might be why his successor Dr Parkinson has actually now concentrated on the GST. However it could also be an attempt to deflect focus from the discovery that the Henry evaluation has actually not assisted preserve continuing strong development in personal earnings tax collections when the populace is maturing.

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Daryl Dixon

Executive Chairman

Daryl Dixon is one of Australia’s foremost investment experts and a well known writer and consultant. He has provided trusted advice to thousands of personal clients over more than 25 years and is an acknowledged expert in the areas of tax, superannuation (including public sector superannuation), social security and investments.

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