# Australian GST reform debate

> Live situation record from CLSTR: https://clstr.news/situations/australian-gst-reform-debate
> Updated: 2026-10-20T18:00:00.000Z. Sources: 9. Developments: 2.

The Grattan Institute has proposed a major overhaul of the Australian tax system to address rising national and state debts. The proposal recommends increasing the Goods and Services Tax (GST) from 10 per cent to 15 per cent and removing current exemptions for grocery staples to include all food items. This change is estimated to generate approximately $76 billion annually.

Under the institute’s plan, $33 billion would be used to reduce income taxes for low- and middle-income earners, while $25 billion would fund increased welfare payments, such as pensions and rent assistance. Grattan Institute CEO Aruna Sathanapally stated there are ‘no easy paths back to budget sustainability’ due to an ageing population and rising debt.

Following this proposal, a broader debate has emerged among political and economic figures regarding tax reform. Proponents of the discussion include former treasurer Josh Frydenberg, former finance minister Mathias Cormann, and independent MP Allegra Spender. The debate focuses on managing national debt and deficits, which have reportedly grown from 5 per cent of GDP twenty years ago to 45 per cent today.

## Timeline

### 2026-10-20: Australia tax reform debate focuses on potential GST increase

Economic experts and political figures are debating potential GST increases in Australia to address rising national debt and long-term budget deficits.

2 sources. https://clstr.news/cluster/australia-tax-reform-debate-focuses-on-potential-gst-increase

### 2026-10-18: Grattan Institute proposes raising Australia's GST to 15%

The Grattan Institute proposes raising Australia's GST from 10% to 15% and removing food exemptions to generate $76 billion annually for income tax cuts and increased welfare payments.

8 sources. https://clstr.news/cluster/grattan-institute-proposes-gst-increase-to-fund-tax-cuts

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Cite as: Australian GST reform debate. CLSTR, https://clstr.news/situations/australian-gst-reform-debate