NSW Premier calls for GST to be 15%

The only problem with a tax like the GST is that it affects lower income families more – because it represents a larger slice of their take-home income than those well off. Mr Baird suggests that offering a compensation package for those households earning up to $100,000 would ensure they weren’t disadvantaged.

With the change of government came a change with Queensland’s stance on the issue. It presumes there would be no palliative payments to ease the pressure of an increased GST on low-income earners.

There does seem a consensus that Mr Baird has explained a simple truth: none of them can afford to pay for the health system voters now have and expect to keep in the future.

NSW Premier Mike Baird has launched a scathing attack on the state of politics in Australia in a video about his proposal to increase the GST. According to modelling done by NSW, on current projections “by 2030 the annual budget deficits across the commonwealth and states will be about $45 billion, of which about $35 billion will be generated by health”.

The Council of Australian Governments will hold its leaders’ retreat from July 22-23. Then there’s the benefit of the changes to the tax mix.

Abbott said he wanted to see “the overall tax burden go down” while at the same time having “a more rational arrangement of finances and responsibilities between the commonwealth and the states”.

The GST isn’t a popular way to raise revenue, but it’s effective. So more taxes for more expenditure that is how we have gotten into this problem in the first place with the Budget being where it is.

While Australia had one of the most efficient health care systems in the world, it was agreed that health was a top priority for all levels of government, with a serious funding challenge made more hard by an ageing population. It’s not simply a matter of prices going up. “We want to be absolutely sure that we are not the generation of leadership which lets our people down”.

Increasing the GST from 10 to 15 per cent, he argues, will help overcome this.

The Social Services Minister is in Melbourne to give a speech about the need to review housing assistance in Australia. A conga-line of economists (now there’s an image) have also stepped out in favour of it over recent years.

Former Liberal leader John Hewson, who pushed for a 15% GST in the early 1990s, has welcomed the “mature debate” on the range of tax options.

The real hurdle here, and the factor that won’t have the nation holding its breath this week awaiting a deal, is that government leaders need to strike an agreement.

The Premier wouldn’t stand up to Prime Minister Tony Abbott when he cut $25 billion from schools and hospitals across New South Wales, he says. So there is some momentum, even if it’s faint, ahead of the leaders gathering in Sydney tomorrow.

The Federal Government established the fund with the proviso that states privatised assets in order to access it. So there is a long way to go.

“I’m just really pleased that Premier Mike Baird, along with [South Australian] premier Jay Weatherill, are prepared to have a constructive, responsible discussion”, Abbott said in a joint press conference with Baird on Monday.