The Business Council of Australia is calling for a national discussion on tax reform to start a process which deals with the extraordinary economic cliff Australia will face in the future, including a declining participation rate and revenue shortfall of $140 billion.
BCA Chief Executive Bran Black said practical steps need to be taken now to bring Australians together and start the journey to consensus on reform.
“We need a national discussion on tax reform to break through policy paralysis, with critical decisions being left in the ‘too hard’ basket for too long,” Mr Black said.
“Right now you’d struggle to find any economist who thinks our tax system is OK, and so we must double down and ensure we make our tax system genuinely productivity enhancing to generate the prosperity we need for a brighter future.
“As the latest Intergenerational Report found, we face a ticking time bomb of economic shocks which will mean our living standard drops dramatically unless we act now.
“In 1980 we had over 6 workers for each Australian over 65, but by 2060 we’ll have less than 3 – you can’t ignore that terrifying trend.
“About 11 per cent of our workforce is in the care economy now, but that is set to jump to 45 per cent by 2060.”
Mr Black said the national discussion was a key part of the BCA’s pre-budget submission to the Federal Government and was aimed at proposing practical, realistic and productivity enhancing policy positions free from short-termism.
“Of course, the immediate focus of the Government needs to be fighting inflation and responsibly managing cost-of-living concerns, but we need to get moving on the all-important tax reform discussion or we will lose another decade.
“The BCA is realistic that significant tax reform takes time but if we don’t start now our children and the whole country will be worse off.”
Mr Black said the national discussion could include a diverse range of events and opportunities to participate, and with businesses, policy experts, unions and bureaucrats at the table.
“The BCA will be speaking to potential partners in this push for reform, and our focus will be making sure settings are ultimately productivity enhancing.
“As it stands, Australia can’t afford to pay for our future, and so unless we get moving on tax reform our high standard of living can’t last.
“Building consensus for change doesn’t happen in one event or one discussion and we are determined to work with all stakeholders to find a way forward.”
