Trade Minister Andrew Robb supports changing the GST. Photo: Brent Lewin
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Trade Minister Andrew Robb has outed himself as a supporter of expanding the GST in what could be the first clear sign of a coordinated campaign underway within the Abbott government to tackle the thorny issue.
Mr Robb has told the Australian Financial Review the goods and services tax should be extended to products like fresh food and education, but stressed the government did not have plans to change the tax before the next federal election, which is due in 2016.
“I think there’s general agreement that the broader the base, the better, obviously,” Mr Robb said.
“And the lower the personal tax, the better. Whether it’s the GST or a combination of other broad-based taxes.”
The comments will boost the Labor opposition’s claims that the government is mounting a guerilla campaign to build support for changing the tax, according to the report.
A number of Liberal backbenchers have recently called for the GST to be extended. Mr Robb, a former Liberal Party federal director, is the most high-profile member of the Abbott government to so blatantly declare his support for change.
Deputy Liberal leader Julie Bishop this week said she supported “MPs putting forward ideas” but stopped short of giving her own view of whether the GST should be changed.
“We should have a constructive and mature debate about our taxation system and that will include the GST,” she said.
Applying the GST to private health and education could deliver a $2.3 billion annual windfall, while the Grattan Institute believes extending the tax to fresh food could raise $6 billion in revenue each year.
A tax reform white paper will examine all aspects of Australia’s taxation system, including GST, capital gains, negative gearing and dividend imputation. It is expected to be released within weeks, setting the scene for a national debate over the politically dangerous topic of tax reform.
Mr Robb criticised the recent singular focus on the GST.
“I think to pick out one tax at this stage and suggest all the problems in the world will be solved is I think . . . highly inappropriate,” he told the AFR.
“We are going to have a mature full-ranging discussion and we will allow the white paper to canvass any changes that are put forward by organisations, states and territories.”
The GST would be “in the melting pot” of those discussions, Mr Robb said.
Acting Opposition Leader Tony Burke has claimed there is an “orchestrated campaign” underway within the government.
“There is no doubt whatsoever, when you get the third person coming out flying a kite about changes for the GST, that this is not a few rogue members of Parliament acting alone,” he said this week after Queensland LNP senator Ian Macdonald and West Australian Liberal senator Dean Smith joined their colleague Dan Teehan in calling for taxation changes.