{"id":111394,"date":"2023-04-01T16:02:10","date_gmt":"2023-04-01T16:02:10","guid":{"rendered":"https:\/\/websitedesigns.com.au\/elankanew\/?p=111394"},"modified":"2023-04-01T16:02:59","modified_gmt":"2023-04-01T16:02:59","slug":"majority-of-economists-back-an-inheritance-tax-to-help-fund-government-priorities","status":"publish","type":"post","link":"https:\/\/websitedesigns.com.au\/elankanew\/majority-of-economists-back-an-inheritance-tax-to-help-fund-government-priorities\/","title":{"rendered":"Majority of economists back an inheritance tax to help fund government priorities"},"content":{"rendered":"

Majority of economists back an inheritance tax to help fund government priorities<\/span><\/h2>\n

\"elanka\"<\/a><\/p>\n

Source:<\/span><\/strong>Yourlifechoices<\/a><\/span><\/p>\n

Peter Martin<\/span><\/a>,\u00a0Crawford School of Public Policy, Australian National University<\/a><\/em><\/span><\/p>\n

Asked to find an extra $20 billion per year to fund government priorities like building nuclear submarines and responding to climate change, Australia\u2019s top economists overwhelmingly back land tax, increased resource taxes, an attack on negative gearing and extending the scope of the goods and services tax.<\/span><\/p>\n

The 59 leading economists surveyed by\u00a0The Conversation<\/em>\u00a0and the Economic Society of Australia were asked to pick from a list of 13 options (many of them identified in the government\u2019s 2022-23\u00a0Tax Expenditures and Insights Statement<\/a>) and reply as if political constraints were not a problem.<\/span><\/p>\n

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The economists chosen are recognised as leaders in their fields, including economic modelling and public policy. Among them are former International Monetary Fund, Treasury and\u00a0OECD<\/a>\u00a0officials, and a former member of the Reserve Bank board.<\/span><\/p>\n

Asked to choose tax measures on the basis of\u00a0efficiency<\/a>\u00a0\u2013 minimising the economic damage the extra taxes or tightening of tax concessions would do \u2013 40 per cent chose increased or new taxes on land, while 39 per cent choose increased resource taxes.<\/span><\/p>\n

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Responses from 59 economists to the question:<\/span><\/h3>\n

If\u00a0efficiency<\/i>\u00a0was the only priority, how should the government raise more funds? Choose up to three<\/span><\/p>\n<\/div>\n

\n
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\n
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Introduce or increase land taxes<\/span><\/div>\n
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<\/div>\n
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40.7%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Increase resource taxes<\/span><\/div>\n
\n
\n
<\/div>\n
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39%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back negatively geared property deductions<\/span><\/div>\n
\n
\n
<\/div>\n
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25.4%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Broaden set of goods and services in GST<\/span><\/div>\n
\n
\n
<\/div>\n
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25.4%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Introduce inheritance taxes<\/span><\/div>\n
\n
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<\/div>\n
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22%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Tax windfall profits<\/span><\/div>\n
\n
\n
<\/div>\n
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22%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Increase the GST<\/span><\/div>\n
\n
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<\/div>\n
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20.3%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back superannuation tax concessions<\/span><\/div>\n
\n
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<\/div>\n
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20.3%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back capital gains breaks on family homes<\/span><\/div>\n
\n
\n
<\/div>\n
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15.3%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Increase corporate tax rate<\/span><\/div>\n
\n
\n
<\/div>\n
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3.4%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back franking credits<\/span><\/div>\n
\n
\n
<\/div>\n
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1.7%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back Jobseeker or pension payments<\/span><\/div>\n
\n
\n
<\/div>\n
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1.7%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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Wind back deductible work-related expenses<\/span><\/div>\n
\n
\n
<\/div>\n
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1.7%<\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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International consultant Rana Roy said every major economist in every strand of modern economics had found taxes on the use of land and natural resources to be the least damaging way of raising money.<\/span><\/p>\n

This was confirmed in Hong Kong, which charged for the use of crown land; in Norway, which heavily taxed oil and gas resources, and in countries such as Australia, which charge for the use of broadcast spectrum.<\/span><\/p>\n

Former OECD official Adrian Blundell-Wignall said Australia\u2019s natural resources were the birthright of every Australian. It was time for a resource rent tax along the lines of the one introduced by the Rudd and Gillard governments and abolished by the Abbott government in 2014.<\/span><\/p>\n

Blundell-Wignall said politicians should ignore the usual hysteria that arose whenever the idea was discussed.<\/span><\/p>\n

Centre for Independent Studies economist Peter Tulip said he would lump income from inheritances in with income from changes in land value. In both cases the income was unexpected, undeserved and not compensation for sacrifice. And it disproportionately went to the already fortunate.<\/span><\/p>\n

Negative gearing an \u2018easy win\u2019<\/span><\/h2>\n

A quarter of those surveyed backed winding back the ability to negatively gear (write off against tax) expenses incurred in owning investment properties, a concession costed by Tax Expenditures Statement at\u00a0$24.4 billion per year<\/a>.<\/span><\/p>\n

Blundell-Wignall said negative gearing should have been wound back years ago. Few other countries allowed it, and it contributed to the build up of exposure to property in Australia\u2019s banking system and financial risk as interest rates climbed.<\/span><\/p>\n

University of Sydney economist James Morley described getting rid of negative gearing as an \u201ceasy win\u201d. There were better ways to support home building.<\/span><\/p>\n

Independent economist Saul Eslake said while he was inclined to extend capital gains tax to the sale of high-end family homes, the problem with the idea was that it might allow owners to write off against tax their mortgage payments (as is the case for investors who negatively gear), encouraging even larger mortgages.<\/span><\/p>\n

One quarter of those surveyed wanted to broaden the scope of the goods and services tax (at present it excludes spending on education, health, childcare and fresh food) and one fifth wanted to increase the rate, pointing out that a 10 per cent, it was low by international standards.<\/span><\/p>\n

\u2018Unfair\u2019 super concessions and tax-free inheritances<\/span><\/h2>\n

Asked to choose measures on the basis of equity \u2013 not treating similar people differently \u2013 52 per cent backed inheritance taxes, 37 per cent backed winding back superannuation tax concessions and 32 per cent backed increased resource taxes.<\/span><\/p>\n

None would broaden the GST on equity grounds, and only 3.4 per cent would increase its rate on equity grounds.<\/span><\/p>\n

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