The Australian government has announced $300 billion in economic stimulus, but the final figure of the country's debt hasn't been calculated and will take years to repay.

Director of the Tax and Transfer Policy Institute at the Australian National University Robert Breunig has warned Australia's young generations, who have been hit hard by job losses related to the coronavirus, will also be hit hard when it comes time to pay the bill for the economic stimulus without systemic change.

"Our tax system is overdue for a serious overhaul and that's going to become particularly important when we come out of the pandemic," Professor Breunig argues.

"Because if our tax system is one of the things that makes us grow less quickly then our ability to recover from the pandemic will be reduced."

Australia's tax system is overly reliant on personal income and corporate taxes, with not enough use of consumption taxes like the GST and land tax, and this would need to change to aid the country's recovery after the worst period of the pandemic shutdowns has passed, he says.

An expert panel of academics, senior public servants and former politicians could be pulled together to re-write the tax system to both be more equitable and encourage more growth.

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Professor Breunig says politically toxic ideas like increasing GST, including owner-occupied houses in the asset test for the aged pension, death duties and moving from stamp duty to land tax could have a better chance of becoming reality if introduced under system-wide reform rather than as standalone changes.

"The problem if you change one tax law is that whoever loses from that change is going to fight like mad to keep it, but if you change many things at the same time you can do it in a way that makes all of Australia better off.

"Some of us will pay more taxes of one type but less taxes of another type, it can make it easier to pass that."

Australia's tax system and economic stimulus are geared towards protecting people who are asset rich, a strategy which disadvantages younger generations, Professor Breunig believes.

"This is fine for people with assets. But in the main young people don't have these assets and if their parents don't have these assets, they can't even look forward to inheriting them. And so they are the ones who will be left with the bill."

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