Tax Reform

We had a PBO estimate yesterday into a MP reference to them about how much revenue a GST would gain if it was essentially the same as in New Zealand.

We have a few problems when discussing this.

If you raise and broaden the GST ( which I  have no problem with ) the following things need to be done:

• the poor have to be compensated
• The States have to get rid of taxes that inhibit economic activity. as the HENRY Review recommended.
• The States need more revenue to compensate for the funds the Federal government are no longer going to give them
• It needs to gain more revenue to the States over and above the last point so the Federal government can cut income taxes ( from monies they no longer have to give to the States)

Thus you have to raise one hellva lot of revenue to do all these things.

I do not have any problems with any of the above items but I do think it would be politically courageous.

I do agree with Noah Smith