Senate debates

Thursday, 4 February 2016

Questions without Notice

Goods and Services Tax

2:13 pm

Photo of Mathias CormannMathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

I would say to Senator Conroy and everyone who is listening to this answer that I clearly confirmed in my primary answer, which is what I referred to in the first five seconds of my answer to the supplementary question, that Treasury did indeed conduct modelling at the request of state and territory governments, including the very good friend of Senator Conroy the Labor Premier of the great state of South Australia. This is not a secret. This has been long established. I think the Treasurer referred to this as part of the fact-finding. The important point here is that the government has not made a decision to increase the GST and, as such, this is just academic.


Tibor Majlath
Posted on 7 Feb 2016 8:02 am

Why is the result of the modeling a secret?

For the financial year 2013-14, the GST payable and collected breaks into various components as

Gross GST payable = $271,072 million
Input tax credits = $246,733 million (business exemptions)
Deferred GST payments on imports = $24,160 million
Net GST = $48,499 million = $(271,072 - 246,733 + 24,160) million
Customs GST collections = $3,239 million
Total = $51,738 million = $(48,499 + 3,239) million

Source: Australian Taxation statistics

With 15% we could expect a 50% increase in the net GST of around $26 billion. The total net GST take could now be around $78 billion per year. And this doesn't even include a broader base! This will be borne by households not business even after tax cuts/compensation which won't adequately cover the increase.

Remarkable how we can afford to throw away $247 billion per year in exemptions with federal/state budgets in crisis.