What would a rise in GST mean for Australia?

It's hard to think of a party that doesn't have a stake in discussions surrounding Australia's Goods and Services Tax (GST). After all, changes in this area will affect everyone from consumers to business owners and people all throughout the ranks of government. So what could be done?

Any changes to GST will have notable effects for tax agents and other financial professionals, mainly due to the wide impact they will have. Despite this, Chartered Accountants Australia and New Zealand (CA ANZ) feel they have the answer for Australia's tax system.

Their idea is a radical one, with the organisation making the suggestion that GST be raised from its current rate of 10 per cent to 15 per cent instead. 

While their proposal would put extra expenses on the consumer at first glance, CA ANZ believes that a GST increase would enable the federal government to reduce personal income tax. 

The organisation cites the federal government's reliance on personal and company tax as something that needs to change. According to Head of Leadership and Advocacy at CA ANZ Rob Ward, 70 per cent of all government tax revenue is gathered through these channels, a practice he describes as "a time bomb".

CA ANZ believes the benefits estimated in its model will appeal to the wide range of parties that have a stake in the issue of raising GST. According to its estimates, the organisation is predicting that raising GST to 15 per cent could provide and extra $265 billion of revenue to the federal government over a four year period. 

This isn't the only recent example of support for a 15 per cent GST rate. A July 20 Sydney Morning Herald article stated that NSW Premier Mike Baird also supported the cause and is looking to submit his proposal to the federal government.