Goods and Services Tax (Australia)

The goods and services tax (GST) in Australia is a value added tax of 10% on most goods and services sales. GST is levied on most transactions in the production process, but is refunded to all parties in the chain of production other than the final consumer.

The tax was introduced by the Howard Government and commenced on 1 July 2000, replacing the previous federal wholesale sales tax system and designed to phase out a number of various State and Territory Government taxes, duties and levies such as banking taxes and stamp duty.

An increase of the GST to 15% has been put forward, but is generally lacking in bi-partisan support.

The idea for a broad-based consumption tax was first proposed by then federal treasurer Paul Keating at the 1985 Tax Summit but was dropped at the behest of then Labor Prime Minister Bob Hawke after pressure from the ACTU, welfare groups and business, which did not like its association with proposals for capital gains and fringe benefits taxes.

The idea was revived in 1991 by the opposition Liberal-National Coalition led by Dr John Hewson, and a GST was the centrepiece of the opposition's "Fightback!" platform at the 1993 election. The opposition had difficulty explaining the policy, as exemplified by Hewson's famous Birthday Cake Interview, and Labor prime minister Paul Keating's campaign exploited public distrust of a GST, which was considered a factor in the opposition's surprise loss of the "unloseable" 1993 election. In 1994 the Liberals decided to discard the remnants of "Fightback!" and Alexander Downer replaced Hewson as Liberal leader.

...
Wikipedia