Pitcher Partners has called on both government and opposition to prioritise tax reform ahead of the upcoming double dissolution election.
“With an early election looking like a certainty now the ABCC bill has been voted down, Pitcher Partners is calling on all political parties to make this election a tax reform election,” said John Brazzale, Managing Partner at Pitcher Partners.
“The stalling of the Tax Reform White Paper means we’re operating in the dark. Our tax system needs to reflect a world that looks very different in 2016 than it did in 2006.
“We have a revenue and spending imbalance at the heart of the Australian economy, and it’s time to get serious about solving that – not just so it’s easier for business to grow and continue to provide employment now but also to insulate ourselves against the future.
“With continued uncertainty over commodity prices, China and Europe, now is the time to outline an economic vision backed by commitment to tax reform.
“In particular, we need tax reform that makes it easier for the middle market to do business.
“Despite being the engine room of the economy, middle market businesses are disproportionately affected by inefficient taxation systems.
“The middle market misses out on innovation grants and favourable tax treatments that are offered to start ups and small business, and it lacks the market power of big business despite contributing more to economic growth and employment.
“We expect a greater commitment to the middle market from all parties heading into the election.”
Pitcher Partners has outlined a series of reforms to assist the government in designing a better tax system that supports business growth, and pre-election we’ll be seeking commitments from all parties on the following issues:
- We support the increase of the GST to 15 per cent on the current base, or an increase to 12.5 per cent on a broader base, with exclusions for health and education and balanced by appropriate compensation measures for Australians on lower incomes. We want government to be visionary in outlining a long term commitment to replacing less efficient means of taxation with a more stable long term revenue source.
- We support a cut in the corporate tax rate. The current corporate tax rate compromises our ability to compete for foreign investment and is a drag on business growth, especially for the middle market.
- We support Division 7A reform. Division 7A rules are needlessly complicated and do not represent the best approach to taxation for mid-market business.
- Red tape and compliance reduction is critical. Government need to focus on reducing complexity and compliance for the middle market and to make the tax system more efficient for those taxpayers.
- Continuous attempts by governments of all persuasions has compromised public confidence in superannuation, undermining its premise. Australians need superannuation certainty if it is going to function as an optimal savings vehicle.
- And instead of demonising foreign investors we should be looking at ways to attract foreign capital and investment while expanding our trade links with the rest of the world.
For further comment please contact:
John Brazzale, Managing Partner, Pitcher Partners, 03 8610 5110
Sabine Wolff, Media and Communications Advisor, 0419 529 577