Work In Progress Budget
The Commission of Audit has looked at the spending side of the ledger and has identified structural changes to rein in costs, but what is missing is the revenue side, according to the Institute of Public Accountants (IPA).
“All of the measures announced in tonight’s Budget by themselves will not be able to address the unsustainable structural deficit that has been created,” said IPA chief executive officer, Andrew Conway.
“The first step to address the revenue shortfalls is to revisit the Henry Review and look at the most efficient ways to collect tax.
“Temporary taxes are no panacea for genuine tax reform.
“Short term initiatives to fill the revenue gap can be damaging to a fragile economy, particularly in terms of small business.
“Piecemeal tax hikes can erode business confidence and may not produce the anticipated revenue levels as it can lead to behavioural changes.
“However, we are very pleased to hear that the Government is apparently going to reduce the company tax rate. Even though only one-third of small businesses are incorporated, this is a great step forward.
“The promised tax reform white paper can’t come quickly enough to restore productivity and growth in the Australian economy,” said Mr Conway.