“Everyone talks about the weather but no one does anything about it,” Mark Twain once remarked. For “weather” substitute “tax”, and you’ve got Australian politics in a nutshell.

We no longer have parties that propose markedly different fiscal systems expressing differing values. Instead, politics is around differing schemes for the differing discussions we’ll have on the tax system.

All of which end up in the same place. Australians allegedly won’t accept much higher taxes, but they sure won’t accept reductions in services either. And so everything remains the same, a system where the mere ratcheting up or down of a tax rate comes to be compared to FDR’s first 100 days of the New Deal in terms of its courage and impact.

Meanwhile, bracket creep does all the rest. Labor and the Greens like that for obvious reasons; the Coalition does because it allows them to pose as a low-tax party, while administering the largesse gained from a higher-taxing one.

Neither side of politics should be happy with the situation. Bracket creep puts an increased burden on average earners and reduces the gap between high and average earners.

We don’t simply need a tax debate in this country, but a much wider ranging debate on our whole fiscal system, which takes in proposals for new taxes and new rebates.

GST, negative gearing, bracket creep — these should be the minor matters in a fiscal system debate, not the major focus. The current debate is a measure of how small our politics has become. But then, everyone talks about Australian politics, but no one does anything about it.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey