Productivity roundtable final day: Tax reform up for discussion as summit eyes negative gearing
The third and final day of the federal government's economic reform summit in Canberra will focus on tax reform and budget sustainability on Thursday.
The government went into the federal election in May promising not to make changes to negative gearing and the capital gains benefit, but forum attendees are still expected to make the case for the reforms.
Unions are set to argue for a full suite of tax measures including limiting negative gearing to one investment property, with existing laws allowed to stay in place for the next five years.
A minimum tax rate of 25 per cent for people earning more than $1 million per year has been pitched by union attendees.
Capital gains and negative gearing reform needed to be considered by the government to take to voters, tax expert Dale Boccabella said.
'Aspects of the tax system is just unfair and the big one is the capital gains tax discount,' the associate professor of tax law at the University of New South Wales told AAP.
'If you look at who gets the benefits, it goes to the top end, they don't need a 50 per cent tax break.'
Assoc Prof Boccabella said sustainability of the tax system needed to be front and centre during the final day of the roundtable.
'Sustainability and fairness go hand in hand, and underlying that, of course, is generational unfairness,' he said.
'The government should not be criticised for acting on (negative gearing), it should be done in a sustainable way.'
The third day of the summit will include a presentation on budget sustainability by Treasury secretary Jenny Wilkinson.
A pitch on a better tax system will be delivered by Grattan Institute chief executive Aruna Sathanapally.
Discussions on how to make government services and spending more efficient will be another topic for debate.
The roundtable had produced consensus for areas of economic reform, Treasurer Jim Chalmers said.
'We've already got a big agenda to ease the burden on businesses, cut red tape and build more homes but we're keen to do more where we can,' he said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Perth Now
9 minutes ago
- Perth Now
Uni students demand action against Israel
Thousands of students are gathering at mass meetings on university campuses across the country to debate and vote on whether the federal government and universities should implement sanctions on Israel. The national student referendum on Palestine comes after nearly two years of protests, sit-ins, and encampments, and seeks to hold both the government and universities accountable by demanding concrete action. National Union of Students Education Officer James McVicar told AAP the referendum provided a chance for students across the country to vote on ending universities' links to companies involved in the supply of weapons to Israel. He anticipates more than 5000 people to sign up to vote over the coming week. "It shows that students are feeling anger, and outrage, and horror (about) the images coming out of Gaza," Mr McVicar says. "Students and the general population are frustrated that the government and their universities have not listened to the overwhelming popular support for an end to the war. "Not just a tokenistic recognition of a Palestinian state further down the track." Two votes have already taken place at Victoria University and Griffith University, with students voting overwhelmingly in favour of calling on the federal government to impose sanctions on Israel. The majority of the votes will take place over the next week. The vote comes just days after a report revealed Melbourne University breached Victoria's Privacy and Data Protection Act when it used its wi-fi network to monitor students and staff holding a pro-Palestine protest in 2024. Rachel Dixon, the state's deputy commissioner described the incident as a "significant breach of trust". A separate inquiry in July found that the university's conduct had contributed to an atmosphere of self-censorship, discouraging students and staff from speaking openly about pro-Palestinian movements on campus. Mr McVicar hopes the vote will pressure universities to respond to student sentiment and take meaningful action. "The point of the referendum is to put them under pressure to respond," he adds. "We have a mass display of student democracy and an expression of the student voice directed straight at them and straight at the Australian government." The referendum comes amidst a raft of events including a nationwide march for Palestine on Sunday.
West Australian
4 hours ago
- West Australian
Productivity roundtable final day: Tax reform up for discussion as summit eyes negative gearing
An overhaul of how Australians could be taxed will be put in the spotlight as a productivity roundtable draws to a close. The third and final day of the federal government's economic reform summit in Canberra will focus on tax reform and budget sustainability on Thursday. The government went into the federal election in May promising not to make changes to negative gearing and the capital gains benefit, but forum attendees are still expected to make the case for the reforms. Unions are set to argue for a full suite of tax measures including limiting negative gearing to one investment property, with existing laws allowed to stay in place for the next five years. A minimum tax rate of 25 per cent for people earning more than $1 million per year has been pitched by union attendees. Capital gains and negative gearing reform needed to be considered by the government to take to voters, tax expert Dale Boccabella said. 'Aspects of the tax system is just unfair and the big one is the capital gains tax discount,' the associate professor of tax law at the University of New South Wales told AAP. 'If you look at who gets the benefits, it goes to the top end, they don't need a 50 per cent tax break.' Assoc Prof Boccabella said sustainability of the tax system needed to be front and centre during the final day of the roundtable. 'Sustainability and fairness go hand in hand, and underlying that, of course, is generational unfairness,' he said. 'The government should not be criticised for acting on (negative gearing), it should be done in a sustainable way.' The third day of the summit will include a presentation on budget sustainability by Treasury secretary Jenny Wilkinson. A pitch on a better tax system will be delivered by Grattan Institute chief executive Aruna Sathanapally. Discussions on how to make government services and spending more efficient will be another topic for debate. The roundtable had produced consensus for areas of economic reform, Treasurer Jim Chalmers said. 'We've already got a big agenda to ease the burden on businesses, cut red tape and build more homes but we're keen to do more where we can,' he said.
The Age
6 hours ago
- The Age
The act of bastardry that's hurting young generations
So post-tax income and pension payments have gone up relative to the overall population, but not all parts of the population. Older Australians have a post-tax income one-third higher than someone aged between 18 and 30. They used to be around the same. The change has been caused by more tax on the younger cohort and less tax (and larger income streams) for the older bunch. Before the turn of the century, retirees received relatively little in the way of income, relying largely on the age pension to get by. Superannuation was created to ensure older people did not have to rely on government support. It was all aimed at giving retirees dignity in their later years. But along the way, it's gone way beyond dignity. In too many cases, it's become estate planning, tax management or wealth transference. The average 60-ish retiree drawing tax-free income from their super plus a bit of the age pension is getting the same income as an average working 40-year-old. But the spending pressures on a retiree and someone in their early 40s are very different. The retiree doesn't face the 'pressures of saving for the future or supporting a growing family'. They've probably paid off their mortgage while they spend far less than someone of working age. One of those saving pressures is finding a deposit for a home. In 1990, to buy a median-priced house in Sydney required almost seven times the median income. It's now more than 13 times the median income. That's a big factor in the collapse in home ownership among under-35s. That fall in ownership is one of the factors contributing to the drop-off in fertility rates among younger couples. We're asking younger Australians to pay huge amounts for their higher education, leaving many in debt for longer (another issue making it more difficult for this group of people to save for a deposit). Breunig and his team point out that we have a tax and welfare system which rewards people who move their wealth into income-generating low- or no-tax asset classes. About two-thirds of income is captured by the tax system. That's great if you have assets not attracting tax. But for those who don't, like most people under the age of 40, that translates into paying more tax. And that tax is probably going towards services (the health system, aged care) used by older Australians. This is why Breunig and his team believe the intergenerational contract is broken. 'The current tax and transfer system, with its growing obligations to the growing cohort of older Australians and shrinking resources from which to meet those obligations, is spiralling down and unsustainable,' they found. To resolve this problem, you could slash spending. The second-largest expense for the federal budget is the age pension, at $66 billion a year. That's followed by the NDIS ($51 billion), aged care services ($41 billion), medical benefits ($35 billion) and assistance to the states to run their hospitals ($34 billion). Loading The largest expense in the budget world is actually the GST at $101 billion, which goes straight out the door, mostly to fund state hospitals. Combined, that's about 40 per cent of the budget, much of which flows to the old, the sick, the disabled and the young. Another option is to increase taxes on older Australians. That would be the bunch of politically important voters who have managed to move the tax system in their favour over the past 30 years. The economic roundtable was all about finding ways to lift our nation's collective living standards while also fixing the budget bottom line. When it came to tax, the usual ideas such as company tax or the GST dominated discussion.
