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Government weighs GST increase, childcare rebate cuts

Government weighs GST increase, childcare rebate cuts

Australia could be well on its way to a GST rate of 15 per cent, up from 10 per cent.

Two of the federal government’s most influential policy makers did not rule it out today.

One key figure in Malcolm Turnbull’s Cabinet even suggested the Prime Minister should move quickly to take advantage of his political honeymoon.

“We need to create a greater sense of urgency about some of the issues we face,” Cabinet Secretary Arthur Sinodinos said.


From chief of staff to Prime Minister John Howard when he took the GST to an election 17 years ago, now Arthur Sinodinos is the lynchpin Cabinet Secretary as claims emerge the government has treasury modeling on hiking the Goods and Services Tax.

It was not denied by the Treasurer or his assistant.

In a statement Scott Morrison called it ‘speculation.

Assistant Treasurer Kelly O’Dwyer said all options were on the table.

Studies suggest the near $25 billion increase would cost an average family two to four thousand dollars a year.

“A GST of 15 per cent means you pay more to see the doctor, you pay more when you do your shopping,” Opposition Leader Bill Shorten said.

Surely the Prime Minister would avoid it? Wrong.

“If you want to do something substantial, you’ve got to do it quickly and up front,” Senator Sinodinos said.

And do it, he says, while you are popular.

“And you’ve got to do it when you’re in a capacity to maximise the use of your political capital to sell a story to the Australian people,” Senator Sinodinos told Agenda Sunday.

The news comes as the government considers tightening its $3.5 billion child care plan. Wealthier families could be worse off than it appeared in the budget.

For working parents the 50 per cent child care rebate would begin to reduced with combined salaries above $230,000. By $300,000 the rebate would be 30 per cent.

“This is a government who said they would make childcare more affordable, more accessible, yet all we have seen is fees go up,” shadow minister for education and early childhood Kate Ellis said.

But in this case for wealthy couples; and easier sell than the GST increase which everyone pays.