Tax forum begins but MRRT and carbon tax stay off agenda

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Business, union, and community representatives will meet in Canberra this week for the Government’s tax forum to discuss the recommendations from the Government’s Henry Review.

The Government has already signalled that any recommendations suggested at the two-day forum must be revenue neutral to be considered.

It has also put discussion of the minerals resource rent tax, carbon tax, and GST off the agenda.

The forum was driven as part of Rob Oakeshott’s deal to from a minority Government with Labour.

Prime Minister Julia Gillard has asked forum participants to ensure the tax system does not send the wrong messages to the public regarding a greener reshaping of the economy.

“People need to adapt in order to prosper, and I want to make sure our tax system is not sending them perverse messages as they seek to adapt and change,” she told AAP.

“Indeed I want our tax system to facilitate that change.”

Gillard said changes to the tax system had to meet the challenges of offering incentives to increase work participation, an ageing population, and a long running resources boom.

Australia’s beleaguered manufacturing sector is expected to be high on the agenda, with unions pushing for tax breaks for mining and construction companies that use local products.

Treasurer Wayne Swan said today the forum would cost less than the contentious million dollar figure reported in the mainstream media, and was not about appeasing Oakeshott.

He said the tax forum would have gone ahead even if Oakshott had not demanded it.

Oakeshott is still pushing for debate over the GST, and early last month he and Tony Windsor threatened to hold a rival tax forum to discuss “banned” reforms.