Prime Minister Malcolm Turnbull has finally killed off the debate over an increase in the GST, just as Labor was trying to restart it.
"I can assure you that the government will not be taking a proposal to increase the GST to the election," Mr Turnbull told reporters in Rockhampton on Tuesday.
Treasury modelling released last week showed that increasing the GST from 10 per cent to 15 per cent does not give the economic growth dividend people had assumed it would.
"Somewhere between nil and very small," Mr Turnbull said.
Many had thought that a GST hike was already dead and buried when this modelling was released, but Opposition Leader Bill Shorten pounced on comments by Employment Minister Michaelia Cash that it hadn't been taken off the table completely.
"Malcolm Turnbull needs to today stop waffling and just say in plain English, not 300 word slogans, that he will not introduce a 15 per cent GST, full stop," Mr Shorten said in Adelaide.
Australian Greens leader Richard Di Natale welcomed Mr Turnbull's change of heart on the GST, telling reporters in Hobart it would have been "a road to political oblivion".
Aside from ditching the GST, Mr Turnbull said he is looking at every aspect of negative gearing, but he won't be mimicking Labor's 'badly designed' proposal to restrict it to new properties.
"The idea that this is a massive rort for the rich is simply not right," Mr Turnbull said.
His comments came as the Property Council chief executive Ken Morrison warned both sides of politics against "playing around" with negative gearing for a part of the economy that is providing economic growth and jobs.
"We have seen it in the past where governments at the state and federal level have made significant tax changes, claimed it's targeted, claimed it well modelled and in fact it has had major impact," he told Sky News.
Welfare group ACOSS has been calling for reform to negative gearing for some time, saying it is a major distortion of people's investment decisions.
Instead, ACOSS in its pre-budget submission calls for a tax incentive to encourage institutional investors into the affordable housing market to build up stock.
In its budget submission, the Minerals Council of Australia calls for a phased reduction in Australia's corporate tax rate, that remains at 30 per cent for big business, to make the tax system more globally competitive.
The chief executive of biotechnology giant CSL Paul Perreault agreed.
"If you want to attract new industries and jobs and to create top-rate manufacturing facilities then I think you have to be competitive with the people that seem to be getting more of the play," Mr Perreault said.
