
Could a future federal government override the States on GST changes? > Check the facts
Who: “The GST cannot be changed without the agreement of all the states and territories.” Tony Abbott
“No federal government can change the GST without the consent of each state and territory.” The Australian
The claim: The Opposition denies it has any intention of either increasing the GST rate (currently 10 per cent) or extending its scope (for example to include food). The Opposition has announced that it would hold a review of the taxation system if it wins government and the GST would be part of that review. However, the Opposition claims that even if it wanted to it could not increase the GST without agreement from the states and territories.
The facts: The Coalition had promised a ‘comprehensive White Paper on tax reform’ which includes the GST. The legislation creating the GST includes provisions for only making changes subject to the agreement of the states and territories. However, new legislation could repeal those provisions. For example amending and/or repealing the relevant parts of A New Tax System (Managing the GST Rate and Base) Act 1999 and A New Tax (Goods and Services Tax) Act 1999 would be necessary to change the rate of GST and broaden its scope.
The finding: Like any tax the GST could be changed without the agreement of the states and territories.
Discussion of evidence: The GST was introduced under the Howard government. Food and educational materials were excluded. The Business Council of Australia has released an action plan that includes lowering business taxation and potentially financing lower business tax with a revisiting of the GST. Business interests have openly called for a widening and broadening of the GST.
The Coalition has said that if it wins the election any tax initiatives outlined in the proposed White Paper would be taken to a subsequent election. But at any time governments can change the GST legislatively. There may well be political challenges for a government wanting to change the GST, but if it can get legislation through Parliament it can make those changes.
An increase in GST will impact the poor who have little or no discretionary money.If the GST is increased low income and medically stretched folk will have real problems.
The well off, over extended, well off may have trouble making ends meet, however, these people have the means to change their spending patterns to cope.
Those with large amounts of discressionary funds will not be effected
An increase in GST is all about not tackling the real issue of the low tax collection. Very easy to hit the low paid who really have no voice other than the ballot box. How about tackling the tax havens that the top 61 companies of Australia use to avoid paying proper income tax for starters.
This proves that TA cannot be trusted. He slams and blocks actions by the current government to raise taxes, then when those are introduced and passed then slams big new taxes and then goes about promises big tax cuts to the big end of town.
Now when asked to provide costings says that will submitted for review late in the election. Only way gap can be filled is to raise tax somewhere. Likely target is GST
Tony Abbott is a compulsive lier they pour out of his mouth like tap water. The best bit even he believes them! He made a statement publically on TV then openly denied it! When someone lies looking you in the eye that person has betrayed any sort of TRUST for evermore.
I doubt that Tony A will change the GST during his first term. If the review of the Tax system suggests that an increase in the GST was the best approach I would have no problems with any Government going to an election with that as a centerpiece of their tax reform. The people then get a chance to vote on it. As for it hitting the poor disproportionally this can be dealt with through the welfare and tax system. I for one would be prepared to wear an increase in GST if it meant that the unemployment benefit was significantly increased as it is impossibly low at the moment and there looks to be no likelihood of it being revised any time soon.