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New tax incentives needed to foster Aboriginal investment

Zak Kirkup -

In a significant keynote speech delivered to the 11th Annual Aboriginal Economic Development Forum held in Darwin, Professor Wayne Bergmann offered a compelling blueprint for tax reform that promises to unlock Aboriginal economic empowerment.

With unwavering dedication to the pursuit of economic independence as a catalyst for social change, Prof. Bergmann, a proud Nyikina man, leading Aboriginal entrepreneur and Executive Chairman of National Indigenous Times underscored the systemic financial barriers that stifle Aboriginal participation in the economy.

"The Australian Government's biggest investment vehicle in northern Australia is the Northern Australia Infrastructure Fund (NAIF), and $7 billion has been set aside under an Act to grow northern-Australian businesses," Prof. Bergmann said.

"Despite the Indigenous population of northern Australia being significant, there is no dedicated focus to support and grow the Aboriginal business sector in the region.

"This lack of focus to build Aboriginal businesses will create further dependence on the Australian Government to fund welfare.

"If you can build Aboriginal people's capacity and participation in the economy, you will create resilient Aboriginal people who will not need government support.

"Surely that is the fundamental thread of any policy initiative to make any lasting change?"

Prof. Bergmann said the NAIF is not working.

"How many Black businesses have been able to get access to that money? The institutional structures are not set up to grow Aboriginal enterprises out," Prof. Bergmann said.

"One of the biggest challenges for Aboriginal economic independence is the access to capital."

Professor Bergmann criticised the existing financial structures such as NAIF as outmoded and inadequate for meaningful Aboriginal economic engagement advocating instead for "a new endorsable Indigenous tax-exempt business entity that encourages investment with Aboriginal enterprises".

"The purpose of the tax system is to collect taxes for the Australian Government with the objective and purpose to contribute to the economic and social well-being of Australia," he said.

This innovative tax reform is envisioned to entice investors, providing the necessary incentives to foster investment in Aboriginal enterprises through tax incentives for corporate entities and individuals who invest in Aboriginal businesses.

"I think we need something at the front end, that encourages the free market to engage Traditional Owners upfront," Prof. Bergmann said.

"If investors see that they invest with this vehicle, they're gonna get better tax benefits. So this is creating an incentive at the front end and as a result addresses our social inequity."

The essence of Prof. Bergmann's argument is grounded in the need for equity and strategic incentives that do more than promote economic growth for Aboriginal businesses, they should also champion social advancement.

"The principles of the taxation system are distributing tax fairly across the population. Well, that doesn't work for us," he said, calling for a proactive tax system that champions Aboriginal economic empowerment.

The envisioned tax code reform represents a pivotal step towards correcting historical economic disparities, setting the stage for how governments and industries can fulfil their promises of Aboriginal economic and social independence.

"We need policy that makes government and industry more accountable. And the more we do that, the outcome is more economic and social independence," Prof Bergmann declared.

Prof. Bergmann's proposal for a new tax structure is a decisive move towards remedying generations of opportunity loss and establishing a robust foundation from which Aboriginal communities can build true economic autonomy and strength.

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