Henry Tax Review

Last updated

The Australia's Future Tax System Review, colloquially known as the Henry Tax Review was commissioned by the Rudd government in 2008 and the final report was published in 2010. The review was intended to guide tax system reforms over the next ten to twenty years.

Contents

Remit

The review was commissioned as one of the outcomes from the Australia 2020 Summit held in April 2008. [1] [2]

The review was a "root and branch" review, restricted only in that it could not consider increasing the rate or broadening the base of the Goods and Services Tax (GST), imposing tax on superannuation payments to retirees over 60 years of age, or already-announced personal income tax commitments. [3]

Panel

The review panel members included: [3]

Recommendations

The report made 138 [4] recommendations, under nine themes.

  1. Concentrating revenue raising on four efficient tax bases: personal income, business income, private consumption, and economic rents from natural resources and land. Other taxes may be retained if they serve a specific policy purpose such as discouraging smoking or traffic congestion. Taxes fitting into none of these categories should eventually be abolished.
  2. Configuring taxes and transfers to support productivity, participation and growth.
  3. An equitable, transparent and simplified personal income tax: a much higher tax-free threshold (around AUD $25,000), only two tax brackets, and a simplification of superannuation, deductions and offsets.
  4. A fair, adequate, and work supportive transfer system.
  5. Integrating consumption tax compliance with business systems.
  6. Efficient land and resource taxation.
  7. Completing retirement income reform and securing aged care.
  8. Toward more affordable housing: substantially increase rent assistance, gradually move to a uniform land tax and remove transfer taxes (stamp duty), and gradually move to a neutral treatment of rental and owner-occupied housing.
  9. A more open, understandable and responsive tax system.

Reception

Government

Rudd endorsed and implemented only three of the 138 recommendations. [5] [6]

The major item from the Henry Review implemented by the Rudd government was the move to create a Resource Super Profits Tax. The proposal was highly controversial, and has been suggested as the main reason why Rudd lost power. [7] Following his replacement by Julia Gillard as prime minister, the proposed tax was replaced by a Mineral Resource Rent Tax (MRRT). [8] The MRRT was eventually repealed by the Abbott government following the 2013 federal election. [8] Most of the remaining recommendations were not implemented. [1]

References

  1. 1 2 Cooke, Richard (March 2020). "Descent from the summit". The Monthly . Archived from the original on 30 May 2025. Retrieved 19 September 2025. Many of Australia's big-picture forums seem to produce tax reviews as a byproduct, and the 2020 summit was no exception: it prompted The Australia's Future Tax System Review (also known as the Henry Review), which tabled 138 recommendations. Rudd went on to reject 135 of them.
  2. ↑ Rudd, Kevin (31 May 2008). "Australia 2020 Final Summit Report" (Media release). No. 15944. Transcripts from Prime Ministers of Australia. Archived from the original on 9 April 2025. Retrieved 19 September 2025– via Department of the Prime Minister and Cabinet. The Government has already implemented the first of these ideas by setting up the Henry Commission to review Australia's taxation system.
  3. 1 2 Tilley, Paul (October 2021). "Australia's future tax system". Tax and Transfer Policy Institute . Canberra ACT Australia: Australian National University. pp. 6, 30. Archived from the original on 19 September 2025. Retrieved 19 September 2025– via Crawford School of Public Policy.
  4. ↑ "12. List of recommendations". Australia's future tax system Report to the Treasurer (PDF). Australia's future tax system. 23 December 2009. ISBN   978-0-642-74585-9. Archived (PDF) from the original on 2 August 2025. Retrieved 19 September 2025– via Commonwealth of Australia.
  5. ↑ Stuart, Nicholas (2010). Rudd's way: November 2007 - June 2010. Melbourne: Scribe Publications. p. 256. ISBN   9781921640575.
  6. ↑ Aulich, Chris (2014). The Gillard Governments. Melbourne: Melbourne University Press. ISBN   978-0522864557.
  7. ↑ Mercer, Phil (24 June 2010). "The outcry over Australia's planned mining tax". Sydney: BBC News. Archived from the original on 20 September 2023. Retrieved 19 September 2025.
  8. 1 2 Holland, Angus (22 September 2024). "Do big miners pay their fair share?". The Sydney Morning Herald . Archived from the original on 21 July 2025. Retrieved 19 September 2025. Support for Rudd's leadership wavered, and in June 2010, when Julia Gillard defeated him in a leadership challenge, she immediately worked to make peace with the miners. In any event, Gillard's replacement tax was repealed by the Abbott Coalition government in 2014.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.