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Chocolate,marshmellows, and tax reform

With the Australian Government presenting its full-package of tax reform, there are many issues which the government and the Australian people will have to work through. How will a Goods and Services Tax affect health and education? Will it alter negative gearing? By what percentage will income tax be reduced?
But one major issue which everyone wants cleared up is this - how will the proposed tax reform impact upon the price of rocky road icecream at Baskin Robbins?
Prime Minister John Howard last night repeated claims that the new tax system would not hurt the icecream consumer.
"When people see the details they'll see it will be fair," he told Nine's A Current Affair.
Meanwhile the NSW Government commissioned Arthur Andersen to measure the impact of a GST on rocky road icecream.
The report - Broad Based Indirect Tax: Analysis of the Impact on Icecream- was based on the work of Professor Neil Warren of the University of NSW, the State Government's tax adviser.
Professor Warren's report said that a 10 percent GST, with the combined elimination of the current added tax, would decrease the cost of a single scoop of wildberry by $0.45. However, there would be an increase in chocolate delight of $0.25. The report did not cover rocky road icecream.
NSW Treasurer Michael Egan said the report made it clear that chocolate iceream lovers would be the biggest losers. "The stark and ugly reality is that the wildberry fanatics will still be better off. They are creating a divided society".
Federal Opposition Leader Kim Beazley said the GST would "standout like a huge triple scoop of tutti frutti in the lives of families".
"The Government will say there is an icecream compensation package but it won't work."
Director of Baskin Robbins Australia, Mr I. Scream, said that he would be meeting with Mr Howard over the next few days to "work things out".
"I'm sure that we will be able to come to some sort of arrangement,"he said.

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Copyright © Bennett International 1998