Treasurer Scott Morrison has lent his support to a plan to hike and broaden the GST, insisting it would grow the economy.
The plan presented to the Prime Minister’s advisers, by the Financial Services Council, suggested slashing the company tax rate to 22 cents in the dollar while hiking the GST to 15 per cent, and extending it to fresh food, education and health care.
The $36.8 billion raised could then be returned through income tax cuts for workers and annual payments to the vulnerable, such as pensioners.
Mr Morrison said the plan demonstrated that “you can change the tax mix and grow the economy”.
“The goal here of growing the economy, the goal here of growing jobs, can be achieved, at least as that presentation demonstrates, by changing the tax mix,” he told Sky News on Monday.
“The thing you have to do is get the income tax monkey off people’s back.
But Mr Morrison insists any change to the tax mix would be put to voters at the next federal election.
“The ultimate arbiter on these things is the Australian people,” he added.