Tax reform painstaking, difficult says Govt

PETER CAVE: The Federal Government’s tax forum has kicked off in Canberra with a warning from the Treasurer that making changes to the tax system will be painstaking and difficult.

Wayne Swan has urged participants to learn from the recent divisive debates about the resources rent tax and carbon pricing by appreciating each other’s views just a little more.

The two day forum isn’t expected to produce big changes in policy but the Government says it will seriously consider ideas, as long as they are revenue neutral.

The Opposition Leader, Tony Abbott has dismissed the event as a pointless political talkfest, and has denied that the Opposition were ever invited to attend.

From Canberra, Naomi Woodley reports.

NAOMI WOODLEY: The Prime Minister opened the two day forum with a plea to participants not to talk down the strengths of Australia’s economy.

JULIA GILLARD: We do continue to see an economy in which people lack confidence and are concerned about the future. It’s important in this age that we are reliable interpreters to the Australian people of the strengths and opportunities in our economy, as well as what is happening in the global economy.

NAOMI WOODLEY: Julia Gillard says there are five factors shaping the future of Australia’s economy: the ongoing effects of the global financial crisis, the emergence of Asian economies, the need to price carbon, the pressures from Australia’s ageing population, and the likely length and strength of the resources boom.

JULIA GILLARD: And that means the transformations in our economy that it is driving will be deep and occasionally painful. So working through our tax settings needs to understand the dimensions of this change and the patchwork economy that is resulting from it.

NAOMI WOODLEY: The Prime Minister told the forum that no subject was off limits, but she urged them to be realistic about the ideas the Government was likely to accept.

JULIA GILLARD: We are a Labor government and that means we will never agree with increasing the tax take or tax burden on the poorest in our community. Never have, never will, and no proposition that advocates for that will be taken forward by this government.

Second, we are a prudent government. A government determined to return the budget to surplus. So things that cost have to be paid for.

NAOMI WOODLEY: The Treasurer, Wayne Swan also had a message of caution, urging participants to put forward ideas, along with an explanation of how they’d be paid for.

WAYNE SWAN: You can’t just click your fingers and turn the tax system over completely overnight. It’s painstaking to implement the reforms bit by bit and it can be a hard slog.

NAOMI WOODLEY: The Treasurer indicated the Government has taken some lessons from the backlash to its first proposal for a resources super profits tax.

WAYNE SWAN: We’ve managed to make some very substantial progress in tax reform in recent years despite a pretty divisive and very difficult debate. I think that all of us, all of us have learned from the past few years that we should spend more time appreciating each other’s views.

NAOMI WOODLEY: But he’s again made it clear that the forum won’t be dictating changes in government policy.

WAYNE SWAN: We didn’t get elected to government in order to contract these decisions out. Today is part and parcel of us listening to your voice about what more can be done in addition to the raft of reforms that we have already put in place.

NAOMI WOODLEY: The Government says it would have held discussions about the next steps in tax reform, even if the forum wasn’t a demand of the independent MP Rob Oakeshott. He wants to see a government response to the ideas generated by the forum by the end of the year.

ROB OAKESHOTT: A lot of people have come a long way and put their own time and resources into contributing into this process. There’s been some really good submissions from a whole range of different advocacy groups and individuals.

NAOMI WOODLEY: Despite the Government’s clear moves to downplay expectations about specific policy changes, the Greens leader, Bob Brown went into the forum with high hopes.

BOB BROWN: Our aim is to see that we do get a result but that’s really up to the Government. And the Opposition’s not here so, you know, you’ve got a drag on the potential for good outcomes here because a negative Opposition is missing.

NAOMI WOODLEY: Wayne Swan has had a similar message as recently as yesterday.

WAYNE SWAN: The Opposition were invited to come along to this tax forum to participate in a constructive way. They did not accept that invitation.

NAOMI WOODLEY: But the Federal Opposition Leader, Tony Abbott directly contradicted him today.

TONY ABBOTT: We didn’t get invited. I mean this is basically designed to make the Government look good. They’re spending almost $1 million to stage what I think is going to be, in the end, a pretty pointless PR stunt. And the last thing they wanted to do is to invite the Coalition.

NAOMI WOODLEY: The Government says it would have welcomed someone from the Coalition attending if they were prepared to be positive.

TONY ABBOTT: What’s the point of going to a forum which isn’t allowed to discuss the Government’s two big, new tax increases?

NAOMI WOODLEY: Instead he’s spending the day in Sydney’s north-west continuing his campaign against the Government’s carbon tax.

PETER CAVE: Naomi Woodley reporting.

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