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Australia's aggregate tax burden paper

Published on 01 Jan 07 by Australian Tax Research Foundation

This paper looks at a range of government tax and service issues from the point of view of comparing “aggregate tax burdens”. It discusses the use of the tax-to-GDP ratio as an indicator of tax burden and some of the problems that this measure can present. To get meaningful comparisons, it
relates the tax-to-GDP indicator to the purposes for which tax is collected, showing that without these links the tax-to-GDP indicator has a range of weaknesses that can give misleading impressions of government size and tax burden. The paper provides a brief survey of some other issues that may have affected Australia’s tax burden in the past, and which may influence the future scope for change.

The aim of the paper is to get a better understanding of the measures and the issues they address. It is not a paper that ultimately takes sides in the debate about whether tax burdens are too high or too low. The intention is to provide a high level map of the issues, to better inform the political discussion rather than directly participate in it.

Author profile

Greg Smith
Greg is an Adjunct Professor at the Australian Catholic University and a Senior Fellow at the Melbourne Law School. He is also a member of the Commonwealth Grants Commission, CEDA Council on Economic Policy, and the Government's Specialist Reference Group on the Taxation of Multinational Enterprises in Australia. He was formerly a head of the Federal Treasury Revenue and Budget Groups, and a member of the 'Henry' Future Tax System Review panel. Greg has recently been appointed Chair of the Grants Commission. - Current at 14 August 2014
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