By increasing the GST to 15%, we could make the tax system fairer for younger Australians (18 Aug 2025)
Article summary: In a compelling article, Kate Chaney, the independent Member for Curtin, calls for urgent and courageous tax reform in Australia, criticising both major political parties for their reluctance to address long-term structural challenges. She reflects on a time when governments took bold steps—such as floating the dollar, introducing the GST, liberalising trade and implementing the NDIS—and contrasts it with the current political landscape, which she describes as dominated by “embarrassing small-mindedness.”
Chaney highlights post-election Treasury advice given to Treasurer Jim Chalmers, which warned that current budget settings are “unsustainable” and that indirect taxes could be a viable avenue for reform. She argues that without serious policy action, Australia risks handing younger generations a reduced standard of living, weakened public services, and a deteriorated environment.
Pointing to the 2022 federal election, Chaney notes the declining support for major parties, with 33.6% of Australians voting for community independents or minor parties—clear evidence, in her view, of widespread discontent over the lack of ambition in economic and climate policy. She suggests that genuine reform may not come from majority governments, but rather from minority governments under pressure from a principled crossbench.
Chaney and fellow independent Allegra Spender have been vocal advocates for tax reform in Parliament—Chaney having raised the issue 10 times, and Spender 21—while major parties have largely avoided the topic. Chaney expresses cautious optimism about the Treasurer's decision to broaden the economic reform roundtable to include tax reform, interpreting it as a potential turning point. However, she criticises Prime Minister Anthony Albanese for appearing to lower expectations by limiting the scope to minor changes.
A key concern raised by Chaney is the disproportionate tax burden on younger Australians. She highlights bracket creep—where inflation pushes workers into higher tax brackets—as a stealthy and regressive way to raise revenue. She argues that the GST, while politically sensitive, presents a promising path forward. At present, Australia’s GST is among the lowest and narrowest in the OECD, applying to just 7.5% of the economy compared to an OECD average of over 11%, and set at only half the average rate.
To address this, Chaney and economist Richard Holden revisited their 2023 proposal for a “progressive GST.” Under this model, the GST would increase to 15% and exemptions would be removed. Crucially, it would include an annual $3,300 payment to all adults, effectively shielding the first $22,000 of spending from the tax and ensuring equity. Modelling from the Parliamentary Budget Office indicates that this change could benefit the bottom 60% of income earners even before factoring in future income tax cuts, made possible by the additional $24 billion in revenue raised.
Chaney challenges the Labor government to seize its 19-seat majority and lead genuine reform, warning that failure to act will leave them accountable to voters in 2028. “The small-target game is over,” she declares. “Australians are ready for courageous action to secure a prosperous future for our children.”
Related article: Tax reform must include GST: economist (8 Aug 2025)
