Labor Legend Bill Kelty Demands Comprehensive Tax Overhaul
Former Australian Council of Trade Unions secretary Bill Kelty has delivered a powerful testimony before a parliamentary committee, advocating for significant changes to Australia's tax system. The union legend and co-architect of 1980s economic reforms emphasized that merely scaling back the 50% capital gains tax discount for investors would be insufficient without broader structural reforms.
A Call for Systemic Change
Kelty, appearing before the Greens' parliamentary inquiry into capital gains tax, argued that young Australians increasingly feel economic policy is rigged against them. He warned that piecemeal adjustments to tax breaks would fail to address fundamental inequities in the current system.
"The nub of the problem is the tax system for young people – you have to fix that," Kelty declared. "Ad hoc changes that end up nowhere are not meaningful."
The Burden on Younger Generations
The former Reserve Bank board member painted a stark picture of financial pressures facing younger workers. He calculated that a worker earning $80,000 annually might retain only $16,000 after accounting for:
- Income taxes and insurance payments
- Goods and services tax obligations
- Higher Education Contribution Scheme repayments
- Escalating rental costs
- Basic living expenses
Kelty questioned the value of isolated tax changes for those struggling with immediate financial pressures: "If I can't pay the bills next week, do you feel better that the government has reduced the CGT discount? Well, it doesn't make a difference to me."
Beyond Bite-Sized Reforms
The Labor heavyweight criticized the current government's approach of breaking economic reform into "bite-size chunks," arguing Australians deserve a comprehensive overhaul. He specifically rejected the idea of using tax changes to fund increased military spending, stating: "What's it for? To increase expenditure and spend it on Aukus? I'm not keen on that idea."
Kelty proposed several substantive reforms including:
- Indexing income tax thresholds to inflation
- Reducing the top marginal tax rate
- Creating a fairer distribution of tax burdens across generations
Political Implications and Warnings
The veteran unionist issued a stark warning about the consequences of failing to address youth alienation. "I need the parliament of this country unequivocally to stand up and say they are on the side of young people," Kelty urged, adding that without meaningful action, younger Australians might turn to "parties of hate" and "parties of division."
While Treasurer Jim Chalmers has reportedly considered scaling back capital gains tax discounts in the upcoming budget, Kelty's testimony highlights the limitations of such isolated measures. His comments underscore growing concerns that even successful implementation of targeted tax changes would fall short of addressing systemic economic inequities.
The parliamentary inquiry continues to examine capital gains tax policies amid increasing pressure for comprehensive economic reform that addresses intergenerational fairness and systemic disadvantages facing younger Australians in housing, taxation, and economic opportunity.
