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A senior economist at the University of Sydney has called on the government to introduce a 'GST card' that would allow GST charges to vary in line with the holder’s income.
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Academic calls for means-tested GST card
04 August 2015
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7 minute read
Professor David Hensher said a card of this nature could overcome concerns about the regressive nature of the GST and its disproportionately high impact on low-income individuals and households.
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Mr Hensher said the proposed GST card would operate at the point of purchase in the same way as existing swipe cards and would indicate a GST level of between 10 and 15 per cent, based on federal government means testing.
“Built into the card is a code related to a prior means test, which indicates eligibility for a particular GST charge,” Mr Hensher said.
“It could vary anywhere from 10 per cent to 15 per cent on specific purchases and even be exempt on other purchases.”
Mr Hensher said the card could also be used to set a GST level in non-electronic cash and cheque transactions with the amount recorded on a receipt.
The academic’s suggestion comes after NSW Premier Mike Baird sparked renewed debate by calling for an increase in the Goods and Services Tax to 15 per cent.
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