How a 15 per cent increase to GST could fix Australia’s ‘inefficient’ tax system

Australians could receive $3300 every year in exchange for a 15 per cent increase and broadening of the GST under a proposal which would boost the nation’s budget by $28 billion a year.

Professor of economics at the University of New South Wales business school Dr Richard Holden says Australia’s tax system is inefficient.

“It holds back productivity, it holds back innovation, it has intergenerational problems where it taxes younger people of working age a lot more,” he told Ross and Russ.

Press PLAY to hear what other benefits an increase to the GST could have

He also says the changes would make the GST a progressive tax, which would help people with lower incomes.

“Because people on lower incomes obviously earn less and spend less, this has an inbuilt progressivity,” he said.

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