Tax reform is necessary, but on its own it cannot fix an economy shaped by housing speculation, resource dependence and weak productivity.

Michael Keating is right about the moment.

A rare alignment is emerging: a large Labor majority, Senate support from Greens and independents, mounting inequality, and visible fiscal pressure. Windows like this do not open often in Australian politics. His piece captures that sense that something which has long been politically blocked may now be briefly possible.

He is also right that the case for reforming the capital gains discount is strong. A 50 per cent discount made more sense in a different inflation environment. Today it operates less as a technical adjustment than as a structural gift to wealth holders, especially those accumulating assets through housing. He is right too that negative gearing and capital gains concessions together have helped entrench a system in which wealth grows faster than work, and in which younger Australians face a far more difficult path into home ownership than earlier generations did. And he is surely right that Australia remains a relatively low-tax country trying to sustain the expectations of a far more substantial public realm than its revenue base comfortably supports.

In that sense, Keating’s article is useful because it reminds readers that tax reform is not some fringe obsession. It is a necessary part of any serious attempt to deal with inequality, budget pressure and democratic strain.

But the article is still too limited for the scale of the problem Australia........

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