A government hint at a possible shift from direct to indirect taxes is getting strong support from a university economist who is an Independent Senator.

Yesterday Minister in the Ministry of Finance, Ryan Straughn, told the House of Assembly about government’s financial challenges and indicated more emphasis may be placed on indirect taxes which is taxes on goods and services, rather than mainly income tax.

Today when the Senate debated a bill to extend the reduction of VAT on electricity bills, Senator Crystal Drakes proposed an overhaul of the tax system.

She told the Senate that government should consider reducing direct taxation while increasing indirect taxes such as VAT as one of the ways of boosting disposable income.

Senator Drakes believes a change in tax structure could be a tool in public sector pay negotiations.

University economist and independent Senator Crystal Drakes.