Australian Tax Reform: Which Way Ahead?

Abstract

While the 1980s saw major changes to the Australian tax system which sought both to reduce avoidance and evasion and to reform the base structure of income tax, there are design deficiencies in some of these changes which must be attended to. Also a much closer approach to comprehensive and consistent taxation of investment income should be attempted. On the side of indirect tax the replacement of the wholesale sales tax by a broadly based value added tax is highly desirable, but is unlikely to be achievable politically unless lpart of a strategy which combines sales tax reform, tax mix change and income tax reform. In any case, meaningful and durable reform of the tax system requires a basic community consensus which cuts across sectional interest groups and political parties.