Tax the rich, stop the cuts, abolish the GST

Issue 
The Socialist Alliance says the GST should be scrapped entirely.

Some of these Liberal politicians must think that the rest of us are stupid. Take NSW Premier Mike Baird, the always-smiling poster boy for this deeply right-wing party, whose latest pitch for raising the GST from 10% to 15% is a politician's promise that he would spend the proceeds on health and education.

Baird claimed that a GST rise would undo the $80 billion in state cuts over a decade to health and education funding imposed by the federal Liberal government in its 2014 budget.

At the same time, federal Treasurer Scott Morrison has been promising to spend the proceeds of a GST hike on cutting company tax from 30% to 22% and the rest on income tax cuts, which always disproportionately benefit the richest.

In an interview on Sky News on January 24, Morrison made it very clear that he was going to spend the proceeds from the GST on these tax cuts and continue the cuts in social spending.

So which of these politicians is lying? Is it the smiling Baird — who paid someone $1000 a day to put up selfies and chatty posts on his Twitter account — or the federal Treasurer? They cannot both be telling the truth.

In any case, it seems that 54% of us are not being fooled, because that is the proportion who oppose a GST rise according to a recent Newspoll. Only 37% of voters supported the proposed GST hike.

In the wake of the latest Oxfam report on global inequality — the one that produced the shocking statistic that 62 mega-rich people across the globe now hold as much wealth as 3.6 billion of the world's poorest — and reports of massive tax avoidance by some of the biggest multinational companies, most people see the Liberals' push for a hike in the GST as just another greedy grab by the big end of town.

Even pro-capitalist economists are beginning to concede that this cannot go on. Ross Gittins, the economics editor of the Sydney Morning Herald and the Mebourne Age was blunt in a recent column entitled “Big business-biased 'reform' won't fly”.

He wrote: “Big business and high income-earners want to pay less tax — a cut in the rate of company tax and in the top personal tax rate — and if that means other people paying higher tax, say through a higher goods and services tax, so be it.

“Naturally, their self-interest is cloaked in claims about how good this would be for the economy. Benefits going directly to the well-off, we're assured, will trickle down to the punters.

“But rarely do the advocates of such reforms spell out the mechanisms by which lower rates of tax are supposedly transformed into greater effort to 'work, save and invest', much less produce empirical evidence.

The reality is that the rich get away with this because the ruling class is the most class-conscious class in society. When this changes the game is up for the billionaire class.

This turning point might well be close, judging from the popularity of Jeremy Corbyn in Britain and Bernie Sanders in the US. The working majorities of even the richest capitalist countries have had enough of government for the billionaire class.

So far we have seen no equivalent of Corbyn or Sanders in Australian politics. But in the coming federal election, the Socialist Alliance is going to present a platform for taking power back from the billionaire class.

We are not just opposing the proposed hike in the GST, we are campaigning for its total abolition. We support a steeply progressive taxation system that taxes the corporate rich to stop the cuts. And if the corporate rich refuse to pay their taxes, their assets should be confiscated and used for the public good.

[Peter Boyle is the Socialist Alliance candidate for the seat of Sydney. Click here to like his campaign page on Facebook.]

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