Australia Eyes Real Tax Reform

I've long been a fan of the concept of a consumption tax - the name says it all. But in practice, the daily paperwork can drive a business, or an individual, around the bend. Not that income tax is easy to manage, but a consumption tax is just in your face more often.

Moreover, switching from an income tax to a consumption tax is also made difficult by the inertia of special interests who like things the way they are.

So I've advocated a practical consumption tax done through the income tax framework. The formula is pretty simple:

consumption = income - expenses - savings.

In common english: don't tax income that goes into savings, because that money is only gonna be reinvested into your economy anyway.

Now - woo hoo! you go, guys! - it appears Australia is looking seriously at such an approach.

Lead on.