The Business Coalition for Tax Reform (BCTR) has welcomed the Australian Government's inquiry into comprehensive tax reforms to shape our future tax system (the Henry Review).
Releasing its independent, broad scale review of state business tax reform options to the Henry Review, BCTR chair John Stanhope said: “Australian business is currently weighed down by an inefficient and overly complex tax system.”
“State governments are critically over-reliant on inefficient business taxes which jeopardise jobs and hold back the economy.”
“Inefficient state business taxes are volatile and unpredictable revenue sources which are difficult and costly to manage, unequally applied and harmful to business competitiveness.”
“Replacing inefficient business taxes with better revenue sources is a crucial step toward improving the economic health of the nation.”
“Australian Governments should commit to a new round of real business tax reforms that are underpinned by a new inter-governmental agreement.”
The BCTR, of which the Property Council of Australia is a member, has developed three reform packages that provide the greatest ongoing economic gain:
- Package 1: Improving growth by reducing conveyancing duty & removing insurance duties; (0.6% higher GDP in the long term and $10 billion Federal funding).
- Package 2: Enhancing competitiveness by removing commercial conveyancing duty, land tax and reducing payroll tax; (0.4% higher GDP in the long term and $10 billion Federal funding).
- Package 3: Maximising state tax reform by removing conveyancing and insurance duties and reducing land tax. (1.7% higher GDP in the long term and $17.2 billion State & Federal funding).
Each of these packages could be funded wholly or in part by a Federal and/or state broad based tax.
The BCTR argues these packages would represent money well spent, because:
- the packages deliver a large economic dividend per dollar of reform;
- the packages produce larger economic benefits than replacing lower cost Australia-wide taxes;
- the overall tax burden remains the same.
To download the BCTR's letter and submission to the Henry Review, click on the following links: