Chalmers vows to 'dial-up' Labor's ambition for 'bold' tax reform

Australia Broadcast Center

5 hours ago

Jim Chalmers has promised to "dial-up" Labor's ambition to change the tax system and repair the budget, signalling determination to use the government's landslide election victory to push "bold" ideas beyond the platform pitched to voters.
Tax featured prominently in the treasurer's address to the National Press Club on Wednesday, where he declared he was happy to "grasp the nettle" and propose a reform package that created both winners and losers.
"What we're trying to do … is to be up-front with all of you and the country beyond about the trade-offs," he said.
"This is about testing the country's reform appetite and I don't see it in personal terms but I am personally willing to grasp the nettle … I am prepared to do my bit."
Mr Chalmers went further than his prime minister, who told the same forum last week that he wanted to look for "win-wins" with his main focus on boosting productivity.
The treasurer also emphasised the importance of pursuing "consensus" on any changes that come out of his reform round table, which will include a small selection of business and union leaders and experts and be held in late August.
But he was explicit that any changes should improve the budget or at a minimum not worsen it, and that raising taxes on some things could be considered as long as the overall reform package reduced Australia's reliance on taxing people's wages.
"No sensible progress can be made on productivity, resilience or budget sustainability without proper consideration of more tax reform. I don't just accept that, I welcome that," he said.
"Tax reform is bigger than just managing the difficult balance between spending and collecting … It's about encouraging investment, lowering the personal tax burden and increasing the rewards from work."
Mr Chalmers declined to engage in what he called "the rule-in-rule-out game", saying this was "cancerous" for reform and refusing to close off options even if he personally disagreed with them, such as increasing the GST.
"It's not a [policy] I've been attracted to historically, but I'm going to try not to get in the process of shooting ideas between now and the round table … We genuinely want to hear people's ideas."
Budget repair is one of three themes to be discussed on successive days of the round table, alongside "resilience" to global uncertainty and productivity boosters.
Mr Chalmers said his department had identified four reasons for disappointing productivity gains in recent years, which economists see as the only sustainable way to lift living standards.
"Firstly, our economy is not dynamic or innovative enough. Secondly, private investment has picked up, but not by enough," he said.
"Thirdly, skills aren't abundant enough or matched well enough to business needs. Finally … the growth in services, where productivity is harder to find."
The treasurer named priorities including regulation to support artificial intelligence, faster approvals for homes and major products, and "cutting red tape without lowering standards".
On housing, he said further policies would be needed to "build more homes and sooner", acknowledging the government's 1.2 million homes target was "hard [but] not impossible" and that work was underway led by Housing Minister Clare O'Neil.
Mr Chalmers said he would not necessarily favour taking reform ideas to the voters at the next election before enacting them, saying he did not believe the government was assured of another term despite the size of its victory and it may not be "wise" to wait if consensus could be found at the round table.
"It's difficult to pre-empty … Let's see what the nature of the changes are before we make some of those decisions around timing."
The round table will begin on August 19 and be held in the cabinet room, with Anthony Albanese to provide an opening address but the main body of work to be led by Mr Chalmers.
The choice of venue is meant as a signal that participants should leave aside "vested" or sectoral interests, with attendees told to prioritise "practical" ideas in the "national interest".
The invitation list has not been finalised, but Mr Chalmers said he was "surprised" the opposition asked to be involved, not ruling out that possibility but suggesting they should be "constructive whether they're inside the room or not".
"We don't pretend that we'll be in government forever … I don't even accept the argument that says another term of this government is assured. I think few things in politics are assured, and so the more buy-in that we can get across parliament the better."
Labor sources said consideration could also be given to crossbenchers who wanted to attend, with independent MP Allegra Spender regarded as the most likely name, but that no decisions had been made.