sceptic.
A system such as yours would be very suitable in a rational society that values efficient process over "industry".
Making tax sensible would destroy the tax "industry", the personal accountant "industry" and the small business lobby "industry".
Most of our economy is not sensible wealth creation but useless middleman "industries" like these.
Alas, the idea of "good profits" and "parasitic profits" therefore "good industry" and "useless parasitic industry" is simply not understood by politicians, who are somewhat parasitic and so probably relate to parasites more than wealth producers.
With the advent of technology we should be working less hours and spreading work around and recognising that we do not need most humans to be "fully employed". Attempting to do so simply clogs work places with unmotivated and talentless people, making the real work harder to do. (Most big companies are full of "make work". Surprisingly, more so in private enterprise than Public. The decade of record profit has resulted in significant big business bloat.)
So long as the wealthy are subsidised by the poor we will continue to slide. Progressive, not regressive taxes are needed.

Indeed the tax system needs great simplification. However I am a sceptic - most attempts in the past have resulted in more complexity. Believe me, most accountants would welcome the removal of their requirement in the taxation system - it would leave them free to engage business clients in improvement and profit-increasing consulting...much more profitable for an accountant than taxation (but with an ongoing labour market shortage, many are stuck with large compliance workloads).

The problem with the NIT suggested, is that I believe that it ignores how to deal with business profits, and ignores how to deal with fringe benefits (non-cash payments to employees). The system has to have some level of complexity to deal with this. Perhaps an extension of the imputation system, with all business profits or income from investments taxed at a set rate (maybe 20%), and then when those profits are taken for personal use they come with a tax credit for what's already been paid, but the individual taking the income as their own then has to pay the difference (if the individual tax rate is 30%). This should encourage savings, and business reinvestment, as the funds used for such would be taxed at a lower rate, yet still hit at the normal rate if they are taken for personal use.

The current effect of the child welfare system would need to be taken into account as well, with some families raking in $20k+ just for having a housefull of kids (yes I know they cost a lot, but main cost is in provision of shelter). How to I dont know, but no doubt could be worked into the above.

Country Gal,

I'm not sure the NIT "ignores" these things. Certainly you can't write the entire Income Tax Act on the back of an envelope. But it can serve as the backbone for a new tax system in which most of the existing pandaemonium is cleaned out.

For example I suggested interest on deposits be adjusted for CPI before assessing it. Other refinements could cover things like non-monetary transactions as you suggest. The principle should be to smooth out distortions rather than to engineer good behaviour.

Company tax would be charged at the same flat percentage rate as personal tax (the above example of 30 per cent personal tax matching the current company rate). But without the negative tax component (-$15,000 in the example above) which would be only for natural-person taxpayers. (With probably an extra few thousand per dependent once it gets through negotiating with welfare lobbies.)

Recall John Hewson's 1992 Fightback campaign to reform tax with a GST. The original concept which generated so much excitement was that most existing taxes would be replaced by the new, simpler tax, eliminating the inequities, rorts, and tax avoidance industry. Enthusiasm cooled once it became clear that only a few existing taxes would be abolished. The final GST we got was more of an overdue necessity than a great reform.

Australians desperately want a simpler, fairer tax system, with minimal but equitable refinements. If done right, we can all become richer from it, including the government coffers, and this offsets most of the claims of rentseeking lobbies. Even the professional tax cheats would soon find themselves richer from living in an economy that no longer stumbles along with the equivalent of one leg shorter than the other one. Any political party that really seriously offers this can probably sail right into office.

The problem with any major change to any tax system is that taxpayers are generally fairly bright and largely averse to paying any more tax than they absolutely have to.
As a result, people have attempted since tax began to arrange their affairs in such a way as to minimise the tax they have to pay. This inevitably creates some distortions in the way tax is collected or not. Many people bash negative gearing, but the removal of it would have a massive effect on the property market as people move into other investment areas to maximise their tax benefits.
Likewise a 'transaction' tax as someone suggested will accomplish exactly the same thing - people will try to avoid electronic transactions.
This is why tax, to be effective, needs to be simply, wide, and hard to avoid.
It is not simply a matter of changing something and assuming all else will remain equal.

Country Gal,

Different investment rates or personal-use rates sound economically responsible, but they all become abused, leading to tax avoidance through tricky ways of converting between investment income and personal income.

Wouldn't it be better if there was simply no tax pressure either way, then people will invest to invest, save to save, and spend to spend. No more long-standing deductions or rebates.

From time to time, special tax incentives are required, like a training deduction or carbon tax. Such incentives should be for a limited term only, with a sunset clause after say five years. That way the tax system would remain lean, not become a shambling behemoth again with hundreds of obsolete provisions welded onto it long past their use-by dates.

J S Mill I would agree wholly with every word of your post.

Tax is not some method of wealth distribution,

Work is

Tax is not a method of supporting people in the manner they would wish to become accustomed to

Work is

As Dearest Margaret wrote

“The muddle arises because once we concede that public spending and taxation are than a necessary evil we have lost sight of the core values of freedom."