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Policymakers will need to consider if red tape that was suspended during the COVID-19 crisis is necessary post-pandemic, and use the downturn as an opportunity for tax reform, says the BCA.
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Australia needs a competitive tax system post-COVID-19: BCA
29 April 2020
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9 minute read
The Business Council of Australia has said that Australia is in a good position “for a strong recovery” from the economic downturn, provided it effectively manages unemployment and enacts reform.
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BCA chief executive Jennifer Westacott said Australia should really consider whether or not it actually needs some of the tax regulations that have been suspended to help businesses ride out the crisis.
“We will emerge from the COVID-19 pandemic with our reputation as a safe country enhanced,” Ms Westacott said.
“We now need to ensure we also have the advantage of an efficient and competitive tax system that actually attracts investment to our shores.
“As we chart the course forward, we should act on the quick reforms that will get new investment flowing and get started on the bigger, more long-term growth plan.”
Reforms could create jobs
Ms Westacott said that the BCA modelling “makes the point” that Australia needs such reforms going forward to make it easier for companies to do business here, which will create jobs.
According to the BCA, around 20 per cent of Australia’s full-time work force has been “displaced”, with around 40 per cent of those workers at high risk of long-term unemployment.
The workers most at risk of long-term unemployment are those over 50 years of age and those who have completed a high school or below education.
While tax reforms would attract more companies to Australia, Ms Westacott noted that there will need to be changes in other areas to ensure Australia does not see job losses turn into long-term unemployment.
“On skills, we need a system that lets people rapidly upskill as the world changes by giving them access to micro-credentials that let them build their own qualifications and a life-long skills account they can use as they need,” Ms Westacott said.
“Our workplace relations system must be simpler and our enterprise bargaining system must work better for employers and employees.
“These things are possible with shared vision and purpose. As we prepare for the long journey of the recovery, I encourage people to put aside their ideological constraints and abandon their biases against business.
“The choices we make will determine the strength of our recovery.”
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