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Go back to basics on the GST

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3 February 1999

W G° B - A * ,

The tax reform debate needs to go back to basics and Tocus on creating a system that will stand die test of time, the Australian Society of Certified Practising Accountants (CPAs) told the GST Senate Inquiry in Melbourne today.

The ASCPA went over the allocated 1 !4 hours at today’s hearing of the GST Senate Committee at Melbourne Town Ilall today.

“The Committee were particularly interested in the food debate and the implications of making food GST free. It is important that we don’t replicate the anomalies o f die current Wholesale Sales Tax (WST) system in die new tax regime and that means that food must be included in the tax base,” Angela Ryan, ASCPA Tax Director said today.

The ASCPA representatives also explained, in practical terms, the impact of GST free food on the small business sector.

The Committee slated during the ASCPA hearing, that it was the first lime during the inquiry process that evidence had been presented by a full time practitioner who deals with the tax system on a daily basis.

The ASCPA presentation concentrates on three key points that are necessary to create a viable and robust tax system. These are:

• The GST should be broadly based and apply at a single rate to make it administratively simple - particularly for small business - as well as efficient and equitable, • It is essential that the position of low-income earners be protected from the impact of tax reforms. This should be addressed by close consideration of the compensation package - not

through GST concessions, • A lead-time of at least 12 months will be required between the passing of the legislation and the implementation of the GST, to provide adequate time for all administrative arrangements to be put into place. The nominated start date of 1 July 2000 should be met to minimise any

disruption in the transition to a new tax regime.

“These three points will determine the final shape of our tax system and its ability to meet the requirements of the community in the future. It will also determine whether we create a system that will remain robust over time, or one that will be open to constant challenges and changes,” Ms Ryan said.


Contact: Angela Ryan, ASCPA Tax Director, 03 9606 9830 (bh), 0414 865 339 (mob), or Lisa Armstrong PR M anager-NSW , 02 9375 6205 (bh), 0414 834 700 (mob).


Australian Society o f Certified Practising Accountants 170 Queen Street, Melbourne, Victoria 3000 Tel.: 03 9606 9606 Fax: 03 9602 1163 ACN 008 392 452