Straight tax talk
IT is interesting to read the range of comments on Julia Gillard’s carbon tax versus John Howard’s GST.
Ms Gillard, Mr Swan and Mr Combet’s endeavours to give their carbon tax proposal some legitimacy by claiming they are only doing what John Howard did with the GST, is as deceptive as Ms Gillard’s promise not to have a carbon tax.
Labor’s main claim in likening their carbon tax to Mr Howard’s GST is that Mr Howard broke a promise never to have a GST and negotiated with the Democrats to have the GST legislation passed. This is a d e l i b e r a t e d e c e p t i o n b y Gillard and Co.
John Howard did promise not to have a GST in 1995 when he became Leader of the Opposition.
His statements in 1995 should be read and understood. May 2, 1995 ( doorstop interview) – Howard: No, there’s no way that a GST will ever be part of our policy. Journalist: Never ever? Howard: Never ever. It’s dead. It was killed by the voters at the last election.
December 11, 1995 ( Radio 2NC): ‘‘ Can I look you straight in the eye and say this, that if I state before an election that we’re not going to do something and say it in concrete terms, I mean it. One of the worst things about politics in WHAT MANDATE?: Julia Gillard and Labor have not been totally honest in their handling of the carbon tax proposal Australia at the moment is that the public doesn’t believe what political leaders say.’’
Mr Howard always believed in a GST and that Australia needed to broaden its tax base. He also believed in 1995 that you could never win an election with a GST policy hence it could never be party policy.
Before the 1998 election Mr Howard had decided that the need for a GST outweighed the political risk of going to an election with a GST policy.
He won the election and a mandate to implement the GST. Despite Mr Howard having a mandate, Labor continued its opposition and Mr Howard was forced to reach a deal with the Democrats.
Ms Gillard was elected to the parliament at this election and voted against the GST.
To Labor’s shame, and Ms Gillard’s shame, their refusal to acknowledge that Mr Howard had a mandate resulted in a forced compromise with the Democrats that meant an unnecessarily complex GST and the states being able to break their commitment to scrap many state taxes. In 2001, Labor again tried to win the el ecti on promising a GST rollback. Fortunately they failed. The impact of the GST should not be underestimated. The GST was a significant contributor to Australia surviving the GFC in good condition.
If our economy had predominantly relied on a narrow income tax base, we would have had more serious problems.
Income tax receipts crashed during the GFC but the GST income held and allowed the states to maintain their indiv i d ual e c o nomies wit hout draining the federal coffers.
For Gillard and Co. to liken the current event to Mr Howard’s GST, they should have displayed some courage as he did, by declaring before the 2010 election that they supported a carbon tax.
Gillard and Co claim that it is essential we have a price on carbon, it is the right thing to do etc . . . when did they come to this conclusion? The day after the 2010 election?
If they always believed in a carbon tax, why did Ms Gillard promise no carbon tax and why did her ministers support her promise?
If Ms Gillard wants to liken herself to John Howard and his stance on the GST, she must defer the carbon tax to the 2013 election, then announce details of her carbon tax policy or go to an election now.