Accounting firm BDO surveyed more than 500 business across Australia for its annual tax reform survey, and found that multinational profit shifting was the number one priority issue for reform, followed by the GST and state taxes.
In South Australia, more than 82 per cent of respondents – above the national average – agreed that a review of GST was essential to any discussion on tax reform.
Just over 62 per cent of those surveyed believed the GST rate should be increased to enable the abolition of state stamp duties and reform of other state taxes.
Under half – 47 per cent – believed the GST should be increased to allow the states to adequately fund their health and education systems.
Premier Jay Weatherill has led a high-profile campaign for a GST increase to allow states to get a fixed proportion of tax receipts to fund growing health and education costs.
Just over 87 per cent of South Australian respondents believed state stamp duties were a significant impost on business and “reduces the mobility of the population by discouraging the sale of residential and business real estate and other business assets”.
In the 2015 budget, the State Government announced the abolition of stamp duty for non-real property transfers, genuine corporation reconstructions and commercial property transactions.
The national figures showed that multinational profit shifting was the issue in most urgent need of tax reform, despite the Federal Government’s recent moves to tighten up the rules.
BDO national tax director Lance Cunningham said the survey showed the business community was overwhelmingly in favour of a tax reform options paper being released ahead of the budget, but hope had all but faded that this would occur.
“After getting so close to genuine tax reform through the Tax White Paper process, many businesses feel cheated by its recent abandonment and are fearful the federal budget will present only piecemeal measures and a vague commitment to look closer at tax reform after the next election,” Cunningham said.
The survey showed that while a company tax rate cut would be welcome, other areas were considered to be more urgent priorities.
“Like previous announcements regarding carve outs of specific tax areas like GST and individual income tax, there is danger in addressing one-off measures like company tax cuts without taking a holistic view,” he said.
“It is also critical that Federal and State Governments are involved in building the simplest, fairest and most effective tax system we can possibly get.
“Certainly from a business perspective, reform of GST to allow for removal of inefficient state taxes have been identified as much more pressing issues than company tax rate cuts.”
The full report can be found here.
Help our journalists uncover the facts
In times like these InDaily provides valuable, local independent journalism in South Australia. As a news organisation it offers an alternative to The Advertiser, a different voice and a closer look at what is happening in our city and state for free. Any contribution to help fund our work is appreciated. Please click below to donate to InDaily.