Forum more than a talk-fest

Key Points

• Business tax and tax system governance were integral to the two-day Tax Forum discussion in Canberra on 4 and 5 October 2011
• Long-term fiscal challenges were a common thread throughout each session
• The Institute’s Tax Counsel, Yasser El-Ansary, appeared as a keynote speaker in the governance session, arguing for more resources in tax policy formulation and law design processes.

The federal government’s two-day Tax forum earlier this month should serve as a sound platform for action in the implementation of a simpler and more transparent taxation system.

More than 180 delegates from across business, government, academia and the community attended, and while opinions differed on all areas of the tax base, comments made suggest growing uniformity in the need to address a tax system that’s complex to both administer and interpret.

The Institute’s Tax Counsel, Yasser El-Ansary, says there was widespread accord that the intricacies of tax policies needed was not going to be solved in two days of discussion, but a comprehensive approach can and should be committed to.

Efficiency, equity and simplicity were the key principles of Dr Ken Henry’s tax review, with the sentiment again reflected in the six key sessions, including business tax, personal tax, tax system governance, transfer payments system, state taxes, and social and environmental taxes.

'The business tax session yielded significant debate in areas including the possibility of a reduction in the corporate tax income rate, with most participants believing it to be a balancing act between generating the revenue needed for community services and achieving economic growth. Business groups in attendance argued economic growth is currently being stifled by inefficient business taxes,' Mr El-Ansary said.

The transfer payments and personal tax sessions were dominated by social welfare and negative gearing issues respectively.

'Perhaps the most critical resolution to stem from the forum is that any formal reform process undertaken should not be rushed, and requires open and thorough consultation with a range of associated stakeholder groups,' he said. 

'The forum presented a unique opportunity for the government to listen first-hand to the views of stakeholder representatives, but action is now needed.

'Now that we’ve got some momentum, it’s important the ideas are critiqued and assessed on their merits. The transparency of the dialogue at the forum needs to continue well beyond the next couple of months. There’s a huge appetite among the community for substantial tax reform to make things simpler and fairer, so it’s now up to the government to outline a forward direction,’ Mr El-Ansary said.

Measures heralded for assessment include the need to improve arrangements around the use of company losses, and the push for detailed economic analysis to support the business community’s drive for a lower headline corporate tax rate. 

Article last updated 21 March 2012