Genuine tax reform by whichever party forms government in the ACT will make the rest of Australia sit up and take notice, says the Tax Institute's man in Canberra.
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Writing in an opinion piece for today's Canberra Times, Robert Jeremenko says changes to the territory's tax system could prompt the federal government to show more leadership on tax reform.
Mr Jeremenko writes that tax reform is a key part of the negotiations to form government with Greens MLA Shane Rattenbury, given his support for the 20-year territory tax plan introduced in June by Treasurer Andrew Barr.
Mr Rattenbury said this week he stood by his support for the ACT Labor reforms, which include phasing out stamp duty and abolishing insurance levies.
And the Canberra Liberals, despite vowing to repeal the reforms during the election campaign, have indicated they could be prepared to negotiate on tax with the Greens MLA. ''If, as reported, the Canberra Liberals are willing to put tax reform on the bargaining table, then given the Greens' support of Labor's tax reform plans, whoever eventually forms government may emerge with a version of tax reform,'' Mr Jeremenko writes.
''Whether Labor or the Liberals eventually form government, the prospect of a tax reform plan will really make the ACT's colleagues in the states sit up and take notice.
''Better still, the federal government may start to show leadership on the issue of Commonwealth-State relations and bring the states and territories on board to seize the opportunity to set a national vision for tax reform.''
Mr Jeremenko writes that the ACT was the first jurisdiction to take the federal government's Henry Tax Review seriously by commissioning its own review of the territory's tax base, which concluded that Canberra's tax system was unsustainable.
