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Australia left behind on GST



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i°e" , M edia R elease 220/92 29 July 1992

AUSTRALIA LEFT BEHIND ON GST

The agreement by European Community Ministers to introduce a minimum consumption tax across the EC of 15 per cent from 1

January next year makes a mockery of Labor's scare campaign against the Coalition's GST.

The action by the EC shows that consumption taxes are an

efficient form of revenue raising with a track record of success.

Australia is one of the few developed countries that does not have a broad based consumption tax.

It is now essential that Australia adopt the GST. It is not just a matter of accepting a proven tax reform. It is essential if Australia is to compete in export markets on equal footing.

While debate has focussed on the GST, there should be more

emphasis on the LTP - the lower tax policy. The GST will enable massive cuts to personal income tax and taxes on business.

The GST will lift twenty billion dollars in taxes from business, including two billion dollars in taxes from Australian exports. At present, Australian exports are penalised by the effect of ,payroll tax, petrol excise and wholesale sales tax. These will

be abolished when the Coalition's GST is introduced, and exports will- nqt have to pay the GST.

Exports from t h e :EC already have this benefit which Australian exporters are denied.

Australia must follow the EC and introduce a 15 per cent GST to give our exporters a fair go. .

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