Federal Opposition Leader Tony Abbott has said he won’t support an extension of GST in order to boost the economy.
Independent think tank The Grattan Institute proposed broadening the GST base to include health, education and fresh food, which are all currently exempt.
However, Abbott said that he wouldn’t support an extension, even though these sectors account for 40% of Australians’ spending.
China cuts rates
China has cut its interest rates for the first time since 2008, in a sign that Australia’s largest trading partner is concerned about the ongoing financial woe in Europe.
The one-year deposit rate has been cut from 3.5% to 3.25%, on the back of figures that showed that China’s manufacturing industry grew at the slowest pace in six months in May.
Bernanke ready to act over US economy
The chairman of the US’ central bank has said that he is ready to act if the country’s economy is further destabilised by the euro zone crisis.
US Federal Reserve Bank chairman Ben Bernanke said that the US faced risks that could require further stimulus in the future.
The Dow Jones Industrial Average was up 46.17 points, or 0.37%, to 12,460.96. The Australian dollar was down to US98.95 cents.