Guiding policy based on the 'pub test' is foolish. Four propositions prove that

The propositions are: The GST should be increased. It should be applied to fresh food. And education. Donations to charity should not be tax-deductible.

Gasp. Have another schooner and splutter on it while I explain.

This is in the context of last week's accidental release of documents revealing Treasury thinking that we should increase taxes (gasp) to fix the deficit and provide efficient government services expected by Australians. The documents spelling out the details were, alas, kept secret.

The accidental release came in a bundle of documents handed over in response to a Freedom of Information request.

As if Treasury thinking about what the government should do about the growing deficit should not automatically be made public.

It comes after the ATO released information that, in 2022-23, 91 Australians who earned more than $1 million in total income paid no tax at all.

Now, that is worth a gasp.

Analysis of the data by the Australia Institute and the ABC shows that overall, these 91 squillionaires claimed $390 million worth of deductions to reduce their tax bills to zero.

The vast bulk of the claims were for donations to tax-deductible charities, paying tax agents and lawyers to manage tax affairs, and negative gearing.

It is ridiculous that we need a botched reply to a Freedom of Information request to tell us the bleeding obvious: that the federal government must raise taxes to get out of the usual fiscal bind of forever deficits.

Returning to the four propositions. First to charities. A popular (pub) view would be that if you stopped donations being tax-deductible, less money would be given, and charities would collapse or contract substantially.

Wrong. The annual revenue of charities in Australia totals about $200 billion. Only $12.6 billion of that (just 6.3 per cent) is from donations. Given that governments underpin charities, it would be more efficient for the federal government to stop individual deductibility and hand over the $4 billion or so involved directly to the charities.

Importantly, that $4 billion would go to worthy charities, not ego charities often bearing the donor's name, which are merely vehicles for the very wealthy to reduce tax and line up for an Order of Australia for their charity work.

A tiny $1.3 billion (less than 1 per cent) of the bequests Australians make each year go to charity.

How much easier and more philanthropic would it be to reintroduce death duties or inheritance taxes to levy some money for charity and for government services generally?

Once the feds did that, the states would follow. Then they could cut the economically indefensible and inefficient payroll tax and stamp duty.

As for the GST, it is about the only tax those 91 squillionaires paid. That is because it is unavoidable if they want to enjoy their wealth.

Yes, the GST is regressive and hits those on lower incomes, but that can be addressed through the welfare system.

Meanwhile, a higher GST would mean the government would get more tax from those who are able to pay it.

And those 91 squillionaires illustrate why we should change the way the Medicare levy is applied.

It should be applied to income before deductions for charity, tax affairs, negative gearing, and capital gains.

At least they would pay some Medicare levy rather than bludging on everyone else. And obviously, the Medicare levy should be increased to a more realistic level.

The income tests for the health card and child support assess income before negative gearing, so there are precedents for this approach.

On food, a cursory glance at supermarket check-outs reveals that the better-dressed, more affluent-looking people are buying a lot more fresh GST-free food than the less affluent. Some ANU and international research backs this up.

Similarly with education. We should follow Britain's lead and impose the GST (or VAT in their case) to private schools' fees.

Initially, the pub test would suggest that none of the four propositions would be a goer. But the trouble with the pub test is that no one does any study beforehand. If you do not study for a test or exam, the chances are you will fail.

Today is the first parliamentary sitting day since the election. A smart government would not propose one or two large items as Labor did in 2019, which would garner losers into vehement and cohesive opposition.

Better to do a whole lot of minor tweaking within the morass of the Budget papers so people only wake up to a fait accompli - as was done with the removal of the tax deductibility of medical and pharmaceutical gap fees and co-payments.

Big items should be bundled together so that most people get a gain as well as a loss, making reform more palatable.

The image of Labor's huge swelling of its numbers to 94 out of 150 seats will disguise the fragility of that majority, that 63 per cent of the seats were won with just 34.6 per cent of the vote. Labor got more than 50 per cent of the vote in only eight of those 94 seats.

How the government deals with the headline issue of the Treasury's view of tax will underpin virtually everything Labor seeks to achieve in this term and beyond.

That being the case, it would be a good idea to release the whole of the Treasury advice. Hence, the electorate has a greater understanding of the task ahead and is a bit more understanding when the Government tries to trim down some of the excessive tax concessions and tries to boost its revenue base.

Taking the electorate into its confidence more might even increase Labor's primary vote.