Bipartisanship on GST increase

“It’s time for the states to open up discussion about tax harmonisation”.

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“I think the Australian community would be up for a conversation if you could be confident that you had eliminated a lot of waste in health, that you had a much stronger foundation to maybe look at a Medicare levy increase”, Andrews said.

The leaders did not rule out making other changes to the GST.

Speaking at a joint media conference beside Mr Baird in Sydney, Mr Abbott said: “What we have today is a very sensible proposal from the NSW Premier following on from the sensible suggestions from the South Australian Premier”.

NSW Premier Mike Baird proposed increasing the GST to 15 per cent and spending all the revenue on heath, while Victorian Premier Daniel Andrews and Queensland’s Annastacia Palaszczuk, with the backing of ACT Chief Minister Andrew Barr, preferred raising the 2 per cent Medicare levy to 4 per cent over eight years.

Mr Giles, a Country Liberal, said he was also prepared to discuss the GST proposal brought forward by Mr Baird.

Mr Abbott praised the spirit of the retreat, saying it was about “solving problems rather than starting fights”. “The massive cut to health funding has to be filled in some way”, he said.

“This week, as the Premiers and PM gather, I’ll be proposing increasing the GST to 15% with all the extra revenue going to healthcare and compensating lower income earners so they are no worse off”.

Tasmanian Premier Will Hodgman is opposed to any rise in the GST.

She urged leaders to look at superannuation tax concessions, negative gearing and raising the Medicare levy instead.

The Treasurer last week dangled the carrot of future income tax cuts if more money could be found elsewhere, and yesterday Tony Abbott again promised “lower, simpler, fairer taxes” under a Coalition Government. “This is what the people who elected us deserve”.

“Our expectation is that a package can be designed with compensation to ensure households earning up to $100,000 are not disadvantaged”.

“Both [Treasurer Joe Hockey] and I have been quite consistent in our call in providing a level playing field for the provider of key services in Australia, whether they come from overseas or whether they’re provided domestically, and this is an area that we’ve been working with worldwide partners on, trying to get a good understanding of where Australia’s tax system should be for the future, because we have a growing digital and e-commerce world and the tax system needs to stay up with that game”, he said.

“There’s no doubt there is a gap between what we have and what we need to fund basic services in health care”.

“That means being bold enough to embrace GST reform to abolish a range of inefficient state taxes”.

Hewson wants the federal government to take a clear position on the GST to the next election, due in 2016.

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Mr Weatherill told ABC radio in Adelaide that he supported Mr Baird’s call.

Alice Springs in Australia's Northern Territory