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IN PHOTO: Australia's Treasurer Joe Hockey holds a news conference after a meeting of G-20 finance ministers and central bank governors during the IMF-World Bank annual meetings in Washington October 10, 2014. REUTERS/Jonathan Ernst

Federal treasurer Joe Hockey has decided to push for an increase to the GST ahead of a summit to be held next week between all the premiers and chief ministers. The meeting would be presided over by Australian Prime Minister Tony Abbott. He has been hoping for a constructive discussion in order to reform the federation.

According to ABC news, he would be calling upon the states to take up responsibility for their budgets and match taxation capacities with their own spending requirements. He has also planned to push for funding both public hospitals and schools. He insisted on having a, “sensible, mature debate about long-term tax reform.”

Mr. Hockey said that many have expressed to abolish the taxes mentioned in a tax discussion paper released last year and showed interests to broaden the GST base. However, he clearly stated that any change in the GST would have to be backed by “unanimous” support coming from state and territory governments and biparty members of the Federal Parliament. In an interview with ABC, Mr. Hockey did not seem to have an intention of pressurising the government for increasing the GST rather preferred to speak on bringing about broader reforms to the entire tax base.

Shortly after the announcements, ABC Melbourne reported that Victorian Premier Daniel Andrews expressed his disinterest to the general increase to GST because it would disregard a person’s ability to pay no matter how efficient it might look. He confirmed of not extending his support to the changes to be brought about in the GST base especially with regard to food and basic necessities of life.

Mr. Andrews said that a hike upto 15 percent would not have Victoria’s support as it is the recent reduction in funding to the education and health sectors would have to be made up by states, reported the Australian. However, Mr. Hockey pointed out that states such Queensland, New South Wales and Western Australia have failed to remove the inefficient taxes that was supposed to be done with the introduction of the GST 15 years ago. Financial Review reported that he has been keen on encouraging profits, capital investments and workforce participation.

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