PwC Australia’s new chief economist sees tax reform as key for the next economic shift
Treasurer Jim Chalmers has been talking about Australia's move to a "fourth economy", which has economists thinking that a policy shift could be on the cards.
PwC Australia’s new chief economist, Amy Lomas, thinks the federal government is laying the groundwork for a significant policy shift — and tax reform may well be part of the mix.
Treasurer Jim Chalmers has been referring to Australia as on the brink of becoming a “fourth economy”, an extension of former Prime Minister Paul Keating’s depiction of the three economies of Australia’s past: colonial, industrial, and the opening up of the economy to global trade. This new fourth era is expected to be shaped by an ageing population, new technology and an economy largely focused on delivering services including care.
“It’s a way that he’s chosen to discuss and start to put into the public domain the key issue — the services economy challenge and the productivity that goes with it,” Lomas told Capital Brief in an interview, noting that Treasury’s intergenerational report has also highlighted these longer-term challenges and changes.
“The challenge for policymakers going forward will be how you dial up and down the different elements of the taxation system to respond to a fundamental shift — which is that a larger proportion of our population will be dependent relative to the portion of the population that are earning income and participating in the workforce,” she said.
