Australia's last great act of economic courage — Peter Costello
Update: 2025-11-02
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1Description
Peter Costello is the longest-serving Treasurer of Australia (1996–2007).
He led the most complex overhaul of Australia's tax system in the postwar era: introducing the Goods and Services Tax (GST) — a value-added consumption tax — while abolishing a range of indirect taxes (notably wholesale sales tax) and cutting income-tax rates.
I wanted to learn from Peter what it actually takes to achieve a reform at that scale — and why we haven’t managed anything like it since.
In this conversation, we discuss:
- GST implementation war stories;
- lessons on how to get big things done in government;
- why major reform became so much harder after 2000;
- why Peter would sometimes hide revenue estimates even from the prime minister; and
- the baby bonus (introduced in 2004), which led to an uptick in Australia's total fertility rate — making Australia one of the only western countries to increase (albeit temporarily) its TFR since the demographic transition began.
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