On treasury figures, the tax plan will raise between $6bn and $8bn a year in extra revenue. This is because Government is right in saying that the new GST will extract no more than the existing wholesale sales tax and other indirect taxes being abolished.
But after the abolition of WST, tobacco and alcohol would be taxed at only the 10 per cent GST rate. The Government argues that this is bad for health. So it will introduce two new excise taxes on alcohol and cigarettes to bring their retail prices up to the pre-GST level.
A similar argument was made with luxury cars. The sales tax of 45% on them is abolished. The 10% GST is applied, so their price would fall dramatically. The Government proposes a special tax on them to bring their retail price to pre-tax-package equivalent
The new alcohol, tobacco and cars taxes (the traditional milch cows of government) will raise about $8bn extra a year. This is will finance the goodies to sell the package.