National Tax Forum Must Consider Social Equity - VCOSS
15 September 2011 at 12:38 pm
The Victorian Council of Social Service (VCOSS) has urged participants to the October Tax Forum to remember that the point of the tax system is social equity and stability.
VCOSS has published a special National Insight into Tax Reform in the lead-up to the Federal Government’s National Tax Forum on October 4-5.
Pro Bono Australia News joins with VCOSS in publishing this Special Tax Edition.
VCOSS CEO Cath Smith says tax is not usually a policy area inhabited by state-based bodies like VCOSS, beyond state levies like stamp duty and land tax.
However, Smith says VCOSS sees the impact of the federal tax system every day, not just in the revenue it raises to fund services to address disadvantage, but how it actually causes or exacerbates disadvantage.
She says the most obvious impact is in the crisis in housing – with many low-income households struggling to afford a roof over their heads because tax breaks have fuelled rampant speculation, while million-dollar homes become effective tax shelters for high income earners.
But she says it is evident across the system, from the personal income tax breaks which allow higher income earners to ‘opt’ for a lower tax scale to the hidden ‘wealth welfare’ of the superannuation system, which sees one-fifth of the annual value of super tax breaks accrue to the top 5 per cent of earners, while low part-time wage earners do not benefit at all.
Smith says these are the sorts of issues that those concerned about social justice want on the table at the National Tax Forum, which will bring together 150 representatives of the community, business, union, finance and academic sectors to consider: Tax reform: next steps for Australia.
She says no-one should hope perhaps for major packages or consensus to emerge from a two-day meeting but VCOSS agrees with the Australian Council of Social Service (ACOSS) that the forum is an important opportunity to re-open a debate that shut down too early on the review on Australia’s Future Tax System led by former Treasury Secretary Ken Henry.
Smith says the sector did not agree with all that Henry recommended, but his review provided high quality analysis of key problems and solutions and, as a nation, has barely scratched the surface of many of its recommendations.
In the VCOSS publication, Dr Cassandra Goldie, Julian Disney, and Peter Davidson lay out what ACOSS and the Community Tax Forum – a collaboration set up in 2008 by ACOSS, the Australian Council of Trade Unions, Consumers’ Federation of Australia and Australian Conservation Foundation – see as the most pressing areas for reform.
As well, Saul Eslake and Sarah Toohey look at how housing taxes create and exacerbate inequity, Miles McGregor-Lowndes and Cameron Rider explore the impact of tax measures for and on the Not for Profit sector, Mark Henley discusses the pros and cons of so-called ‘sin taxes’, Simon O’Connor examines different models for funding social and environmental infrastructure, and the Vox Pop section asks ‘what was the great social justice achievement of the tax and transfer system and what’s the one that ‘got away’?
To download the VCOSS Publication – National Insight into Tax Reform (PDF) – click here.