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FPA calls for the integrity of the tax reform package to remain intact



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F in a n c ia l P l a n n in g A s s o c ia t io n OF AUSTRALIA LIMITED ACN 054174 453

MEDIA RELEASE 26 M ARCH 1999 , ixjzj: .

FPA CALLS FOR THE INTEGRITY OF THE TAX REFORM PACKAGE — 0 T TO REMAIN INTACT.

If the integrity of the Government's tax reform package, including the GST, was not kept intact it would make a mockery o f the reform package says Financial Planning Association of Australia Limited (FPA) Chief Executive Officer, M r Michael McKenna.

“The Australian taxation system is in desperate need o f reform. A broad-based consumption tax, with suitable compensation measures for low-income earners, offers the best opportunity to lower Australia’s high personal tax rates,” he said.

“The new tax system has been designed to work in its entirety. Exempting food from the GST will increase the level of GST on other goods and services and distort the reforms.”

“This would lead to a repeat o f the ridiculous definitions of foods that apply under the wholesale sates tax, where milk is exempt but flavoured milk is taxed.”

“Rather than exempting food from the GST because o f the impact it will have on low income earners, adjustments should be made to the compensation arrangements to ensure this group is not worse off.”

Mr McKenna was following up on comments made by Mr Michael Cannody, tire Australian Taxation Commissioner, at the Taxation Institute of Australian in Hobart earlier this week.

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M edia Contacts: Sue Coffey, Public Affairs Manager Margaret Sullivan, Public Affairs, Sydney 0413 757 206 02 9224 0846

The Financial Planning Association o f Australia Lim ited The Financial Planning Association of Australia (FPA) is the professional association for financial planning in Australia, with around 10,000 members on a national basis, and offices in each capital city. The FPA is a non- profit organisation whose vision is to ensure Australians have access to professional

financial advice, which enhances their financial wellbeing. The FPA promotes improved quality of financial advice, and high standards of ethical and professional behaviour among its members. FPA members manage the affairs o f 3.7 million Australians with an investment value o f over $118 billion and active annual investments o f $36 billion.