Call for GST to be widened amid $75b revenue shortfall

THE Business Council of Australia has called for a complete overhaul of our tax system, including the introduction of the GST on tax free items such as food, health and education.

A blueprint for economic growth calls for the company tax rate to be dropped to 25% but payments such as family tax benefits to be reviewed.

The lobby group's 10-year plan also calls for infrastructure spending to lifted to around $55 billion a year to improve rail, road and air links.

Australia's population will reach 42 million by 2050 and the BCA says state governments must come up with 15 year infrastructure plans that they stick to.

BCA president Tony Shepherd warned that without meaningful reform Australia faces a bleak future with an ageing population and slowing economy.

"Australia is at a crossroads. We need a comprehensive road map for the actions and changes required to seize our opportunities and avoid our nation slipping back," Mr Shepherd said.

The Business Council's Economic Action Plan for Enduring Prosperity has been developed in consultation with government, business and the community, and proposes 93 actions over 10 years in the nine policy areas Australia needs to get right to ensure a stronger economic future.

"Well-managed growth is essential to deliver what all Australians want - good jobs, teachers and schools, quality health services and better roads and railways," Mr Shepherd said.

"Our challenge to all parliamentarians in the coming months is to look beyond the news cycle and show the leadership and the focus on the long-term national interest the community is looking for.

"As we have previously shown, if we keep going with our current approach to spending we will have to cover a budget shortfall at both Commonwealth and state levels of 5 per cent of GDP by 2050, which in today's dollars would be around $75 billion.

"For example, to cover this the GST rate would need to go to 25 per cent or the Commonwealth would need to cease all payments for education, defence and hospitals, which is clearly unsustainable and unacceptable.

"If we adopt this plan and we can maintain real growth in our GDP of 2.75 per cent per year, which includes achieving annual growth in labour productivity of at least 1.6 per cent, then average per capita income in Australia could double in real terms by around 2050.

The plan recommends urgent action in the first three years to repair the nation's budget, start the process of comprehensive tax reform, improve our workplace laws and reduce the red tape burden that is strangling business investment and growth.

The plan includes key ideas for tackling Australia's long-term challenges, including:

  • a comprehensive audit of public spending to ensure it is being spent wisely and efficiently
  • actions to ensure skilled and educated people are a competitive advantage for Australia through teacher quality and reward for teacher performance, better matching the VET and skills programs to the needs of the workforce, and free up universities from red tape
  • introduction of new productivity payments for the states to encourage and reward them to undertake structural reforms
  • the states should produce 15-year infrastructure plans and Infrastructure Australia should concentrate on national networks in roads, rail, water, gas and electricity, and broadening our approaches to infrastructure funding and financing.

Special screening of Laura’s Choice tells euthanasia story

Premium Content Special screening of Laura’s Choice tells euthanasia story

The film will have a special screening next week.

Qld borders reopen to all of NSW in shock decision

Premium Content Qld borders reopen to all of NSW in shock decision

Premier Annastacia Palaszczuk to open Qld borders to Greater Sydney within days

‘Excruciatingly painful’: Scorpion-like fish no urban myth

Premium Content ‘Excruciatingly painful’: Scorpion-like fish no urban myth

This spiky little creature lives in freshwater waterways