leigh sales starting to look liberal, page-45

  1. 10,445 Posts.
    Re changing the GST rate.

    It is the case that Costello reached agreement with the states that the rate would not be changed without the unanimous support of all states and territories and both Houses of Parliament. This agreement was enshrined in legislation. That is currently the law of the land. When a leader cites this he is being quite accurate.

    However, any law made by a parliament can be amended or repealed by a subsequent parliament. The Act entrenching that agreement can easily be repealed or amended. It is easy to do so as a matter of law; however the political consequences of such a breach of faith in the face of campaigns by hostile states would - I suggest - be political suicide for a federal government that tried to run roughshod over the states.

    Besides, who would be more likely to try to raise the GST - a Liberal coalitiion with a history of running balanced Budgets or a Labor Party desperate for cash to plug a huge deficit? Do the maths.

    No, Abbott was not lying to Sales as the Labor acolytes here desperately suggest. A New Tax System (Managing the GST Rate and Base) Act 1999 provides:

    ........................................
    11 Changing the rate and base of GST
    (1) The rate of the GST, and the GST base, are not to be changed unless each State agrees to the change. Such changes to the GST base should be consistent with:
    (a) maintaining the integrity of the GST base; and
    (b) administrative simplicity; and
    (c) minimising compliance costs for taxpayers.

    ......................................

    That is the law as it currently stands.

 
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