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Election blocking tax reform: Oakeshott

Federal independent MP Rob Oakeshott is concerned both sides of politics are running away from a debate on tax reform, even though he says they privately "get it".

Both Mr Oakeshott and fellow independent Tony Windsor have called for a review of the GST despite Labor and the coalition declaring changes to the consumption tax off limits - especially a year out from a general election.

But Mr Oakeshott says tax reform is not just about the GST, citing the need for doing away with inefficient state taxes.

"Why on earth in Australia we have insurance taxes at all, why do we still have stamp duty in Australia in 2012?" he said on ABC Radio on Tuesday.

The MP said there was a need to a look at getting more out of efficient taxes.

"That is an opportunity to engage the Australian community, not a threat to the election."

The Henry tax review found that of all of Australia's 125 taxes, 10 brought in 90 per cent of all revenue.

The review did not include consideration of the GST.

Mr Oakeshott is heartened by MPs on both sides of politics saying that they "get it".

"I'm not heartened by the fact that we are in such a bad place with our politics that we cannot have a conversation as adults between politicians and the community about how we get our tax mix right for Australia," he said.

Finance Minister Penny Wong insisted the government was not interested in increasing the rate of the GST or extending its coverage.

"We think there are better ways to approach tax reform, and we have demonstrated that," she told Sky News, citing an increase to the tax-free threshold and the loss carry-back tax initiative for business.

The government was looking at the way the GST was distributed among the states and would be briefed soon on ways to make state taxes more efficient.

Australian Greens leader Christine Milne dismissed the need to expand the GST, saying it was "not on".

"What you are doing is saying companies should be fossilised for their fossil fuel intake and the community should pay more for their cost of living," she told reporters in Canberra.