Vigilance Urged Over GST

The Australian Catholic Social Welfare Commission today called on the Australian community to remain calm but vigilant over the impact of the GST in its first year of operation. The Commission also urged Government not to rule out changes to the GST and immediate increases to compensation where vulnerable individuals and families are discernibly worse off following its introduction.

Mr John Ferguson, Acting National Director of the Commission said, "It is inevitable that the response within the community to the GST has been sharply divided. Some are lauding its praises while others are fearful of its impact on their own financial circumstances and the well-being of those made vulnerable to significant increases in costs of living. It is understandable that angst over the uncertainties of this tax are reaching fever-pitch in the final days before its implementation.

"Whether for or against the GST, it cannot be denied that together we face an historic moment when a major new tax on consumption is supplanted into the core of the Australian taxation system. The Government is standing by its commitment that this reform holds overwhelming benefits for Australia despite the many unanswered questions about its consequences for ordinary citizens and many businesses around the country. Following all the debate and some concessions to improve the equity of this system, we must now take the Government at its word that no one will be made worse off."

Mr Ferguson urged the Government and concerned citizens to be vigilant about the equity and fairness of the GST in its first year of operation. "We must pay particular attention to the inflationary effect of the GST which will have its greatest impact on costs of living in the months immediately following its introduction. It is clear that households on relatively low and fixed incomes risk being made worse off where negligible income tax cuts and little or no access to GST compensation will expose them to the impact of higher prices."

Mr Ferguson concluded, "As well as monitoring the GST through the ACCC and paying close attention to evidence concerning its impact on vulnerable groups, the Government must be prepared to assist those who are particularly disadvantaged. For the sake of equity and justice, the Commission urges Government not to rule out alterations to the application of the GST and significant increases to compensation for vulnerable individuals and families following its implementation."