Grattan Institute calls for GST increase to 15 per cent

Summarised from 2 outlets · Updated 18 Oct, 18:01 · Archive

The Grattan Institute has urged Australia to raise the GST from 10 to 15 per cent and extend it to all food items to help pay down national debt.

The Grattan Institute has called for the GST to be raised from 10 to 15 per cent and extended to cover all food items, ending the current exemption for grocery staples. The think tank says the proposal would generate $76 billion per year, which could then flow through to tax cuts for low-and-middle-income earners and expanded welfare payments.

Institute chief executive Aruna Sathanapally said the overhaul was needed to repair state and federal budgets. Commonwealth debt topped $1 trillion in recent months, although Australia's debt as a share of the economy is lower than most developed peers. Dr Sathanapally said there were no easy paths back to budget sustainability, but the changes would allow the government to raise sufficient revenue to care for an ageing population.

Under the proposal, JobSeeker and Youth Allowance would rise by 20 per cent, while rent assistance would increase by 50 per cent to offset the higher GST costs. A low-income single-parent family would be $150 a week better off, while higher-income working families would pay $162 a week more.

How it is being reported

• 'No easy paths': why calls grow for a GST hikeBallooning debt should force a major rethink of the GST, a top think tank says, but the neediest families would still be better off.Perth Now · 18 Oct, 17:32
• 'No easy paths': why calls grow for a GST hikeBallooning debt should force a major rethink of the GST, a top think tank says, but the neediest families would still be better off.The West Australian · 18 Oct, 17:32

In this story: Grattan Institute · Aruna Sathanapally · Australia

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