Global Slavery Tax? G.S.T. to Rise in Oz? – ConspiracyOz

Misa Han

www.afr.com

Jul 20 2015

Low-income families would be hardest hit if the GST was increased to 15 per cent a survey has found. Louie Douvis

GST 15

Households should be prepared to pay an average of $2900 more a year if the GST is increased to 15 per cent.

Modelling by NATSEM at the University of Canberra showed the average household would be up for an extra $2915 GST a year, or 9.3 per cent of their income.

But the bottom 20 per cent of households would be hardest hit by a 5 percentage point rise; those on average incomes of $41,000 would spend 11 per cent of their income on GST or $4500 a year, while the top 20 per cent, on average incomes of $181,000, would spend $14,000 – or a little less than 8 per cent of their annual income.

NATSEM’s Ben Phillips said the government would be expected introduce a compensation package given the regressive nature of the tax.

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“Middle and higher income families are saving more and spending a higher proportion of their income on things like education, mortgage and superannuation, which are GST-free.

“On the other hand you would find low-income families will be spending most of the money they receive. If you take low-income families, like pensioners or those on unemployment benefits, who are no longer in the tax system, most of the tax they pay would be GST rather than income tax. So if you increase the rate or broaden the GST, you would expect there would need to be a compensation package or increased government support.”

Social Services Minister Scott Morrison said on Monday that increasing the GST was a “very expensive change” and he would expect to spend more on welfare payments to compensate those on low incomes.

The NATSEM modelling took the most recent Australian Bureau of Statistics survey on household expenditure undertaken in 2009-10 and inflated it to December 2014 levels. The modelling assumed there would be no change in consumer behaviour if the rate increased.

 

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Posted on July 21, 2015, in ConspiracyOz Posts. Bookmark the permalink. 2 Comments.

  1. Sign the Petition NO GST for Fresh Food! – Mick Raven (widget bar on the right of ConspiracyOz Website)

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