Jim Chalmers Prepares for Major Tax Reform Roundtable

Next week will mark the 40th anniversary of the Hawke government's tax summit. The summit, led by then treasurer Paul Keating, aimed to garner support for a consumption tax but faced challenges due to conflicting interests. Ken Henry, who later became the treasury secretary, played a key role in the reform efforts, dedicating long hours of work alongside his team.

Despite efforts to unite stakeholders, the summit ended with limited reforms as unions opposed the proposed consumption tax. This led to tensions between Keating and Prime Minister Bob Hawke. Jim Chalmers, inspired by Keating's legacy, is now gearing up for a new roundtable on economic reform, with a focus on tax reform.

Chalmers aims to kickstart a process for tax reform through the upcoming roundtable, which will gather key stakeholders to discuss productivity, budget sustainability, and tax system improvements. While specific outcomes may not be achieved immediately, the roundtable seeks to build consensus on the direction of reform.

Experts suggest that Australia's tax system needs rebalancing to reduce the emphasis on taxing income. Chalmers is open to discussing changes, including the GST, to achieve a fairer tax system. However, challenges such as compensating affected parties may limit the extent of reform.

Ken Henry advocates for broadening the GST and exploring alternative revenue sources to ease the tax burden on younger workers. The roundtable discussions may also touch on issues like negative gearing and capital gains tax, presenting potential challenges for policymakers.

As Chalmers leads the tax reform agenda, the process is expected to be lengthy and require careful consideration. The involvement of key figures like shadow treasurer Ted O'Brien signals bipartisan engagement in the reform dialogue, setting the stage for constructive debates on economic policy.

According to the source: Australian Broadcasting Corporation.