Voters typically rank economic issues among their top concerns. And campaigning politicians regularly make bold (but vague) pronouncements regarding their competence and credibility as “economic managers.”  In popular discourse, economic “competence” is commonly equated with being “business-friendly.”

After three long weeks of election campaigning neither the Prime Minister nor the Treasurer has explained how the $48 billion centrepiece of their “economic plan” will be funded. Sure, they love being asked about it, as such questions allow them to say “jobs and growth” a lot. But the actual answer is yet to pass their

New research from Canberra based think tank The Australia Institute has exposed a serious funding hole in the Government’s company tax cut modelling. “Our research has uncovered that the Treasury commissioned modelling finds a $3.9B gain in government revenue because multinationals suddenly and voluntarily begin to pay more tax because the company tax rate drops 5 percentage points.  It is

The centrepiece of the Turnbull government’s ‘plan’ for the economy, and its plan to win the upcoming election, is based on some heroic assumptions. There is no strong evidence to support the government’s claim that cutting the company tax rate will boost “jobs and growth”. And there is no strong evidence that the public will

New research, based on US Internal Revenue Service (IRS) data, shows that the proposed company tax cut would see the Australian tax system delivering billions of dollars to the US Treasury. Australia and the US have a foreign tax treaty to ensure company profits are not double taxed. This arrangement means that companies pay the

For someone who piously bemoans an “us versus them” mentality in political culture, Treasurer Scott Morrison certainly drove a deep wedge into the social fabric with one of the centrepieces of his budget. There are four thresholds in the personal income tax system; Morrison chose to increase one of them, supposedly to offset the insidious effects of “bracket creep.” The third threshold will be raised from $80,000 to $87,000.

The Australia Institute has modelled the distribution of income tax cuts announced in the 2016 Budget. Using census data indexed to 2015, the modelling shows the percentage of income earners who would reap the full benefit of moving the second-top tax threshold cut-off from $80,000 to $87,000. “This tax cut is highly selective, with very

The Coalition Government’s business tax plan would deliver $7.4B to the big 4 banks. “Cutting company tax rates delivers a massive windfall to an already highly profitable banking sector,” Executive Director Australia Institute, Ben Oquist said. “It makes no economic or budget sense to deliver the big 4 banks a multi-billion dollar tax break when

As the Turnbull Government prepares to deliver tax cuts for high income earners and highly profitable corporations, including large banks, the latest data shows those living on government assistance are slipping further below the poverty line.  Professor Ronald Henderson delivered a major report to the government in 1973, which established an absolute poverty line, often

A report analysing cutting the budget repair levy and giving high income earners a tax cut to compensate for bracket creep, as touted by Treasurer Scott Morrison, finds the measure would exacerbate the revenue problem and not deliver growth.  New polling in the report also showed that the vast majority of Australians were not able

As Transfield Services found out last year, governments don’t just outsource service delivery, they outsource political risk. And while Scott Morrison was promoted from immigration minister to Treasurer because of his “success” in “stopping the boats”, he left the Belgiorno-Nettis family, Diane Smith-Gander and Transfield Services shareholders to take the heat and pay the price. Well played, Scott. Politicians

In the lead-up to tomorrow’s pre-election Commonwealth budget, much has been written about the need to quickly eliminate the government’s deficit, and reduce its accumulated debt.  The standard shibboleths are being liberally invoked: government must face hard truths and learn to live within its means; government must balance its budget (just like households do); debt-raters will punish us for our profligacy; and more.  Pumping up fear of government debt is always an essential step in preparing the public to accept cutbacks in essential public services.   And with Australians heading to the polls, the tough-love imagery serves another function: instilling fear that a change in government, at such a fragile time, would threaten the “stability” of Australia’s economy.

A new report models a progressive traffic fine system, based on the Finnish model, for South Australia.  Progressive traffic fines, based on income, rather than flat fees, have been successfully implemented in Scandinavia. The Australia Institute has released a report looking specifically at how the policy could be adopted in South Australia. The report, From

When other people get pay rises, do you feel discouraged from working? If the Australian Taxation Office stopped BHP or Google from using tax havens, would your firm be less likely to invest in its own expansion? In a bizarre twist on behavioural economics, Treasurer Scott Morrison seems to think individuals and companies are motivated

Top economists and community leaders have signed an open letter calling on Prime Minister Malcolm Turnbull to not to cut taxes at this time – especially not on company profits. The letter, published as a full-page newspaper advertisement, is signed by Former Reserve Bank Governor Bernie Fraser, ACTU National President Ged Kearney, Former WA Premier

The latest “big idea” on tax policy from the Coalition government is to grant independent income tax powers to the states.  This would be accompanied by a devolution of funding responsibility for big-ticket services like health care, hospitals, and schools.  Prime Minister Turnbull argues that forcing state governments to raise the money they spend will

New state-wide ReachTEL polling in South Australia and in the seats of New England and Indi on refugee policy shows most voters do not support the current policy to send all boat arrivals to Nauru and Manus Island. The polling also shows majority support for the resettlement in Australia of those assessed as refugees who

The ruling mantra once was user pays, but now laws requiring mining companies to clean up their mess are derided. Where have all the economic rationalists gone? Back in the 1980s and ’90s most conservative politicians and businesspeople were obsessed with expanding the “user pays principle” to all areas of government service, but these days you

A ReachTEL poll of 1217 Queenslanders and 1077 South Australians shows respondents resoundingly rejected conventional political wisdom – that income tax cuts are even more popular than government investment in health, education and infrastructure. (See full results below)  Just over half (53.0%) of voters in South Australia and half (49.2%) of Queenslanders would prefer to

Polling reveals public support for civil disobedience and other protest in support of farmer’s rights against gas fracking operations. The Australia Institute commissioned polling, undertaken by Research Now, about communities conducting civil disobedience in opposition to coal and gas projects in their area.  84% of Australians said farmers should be able to say no to

First published by the Australian Financial Review – here Economic modelling is like a meth lab, it can make you rich or blow up in your face. And like cooking meth, economic modelling gets more dangerous when it is done fast by those new to the industry. But despite the dangers, and the fact he

New Catalyst research, released for International Women’s Day, reveals the best and worst points of women’s participation in corporate Australia.  The report covers female participation on boards and in management as well as assessing policies to help women in the workplace.  While some companies in the ASX have real equality on their boards, overall the

Was it really the Treasury’s economic modeling that convinced Prime Minister Turnbull to abandon his plan to raise the GST and cut income taxes? Treasury simulations indicated the trade-off would have no significant impact on growth. Or perhaps it was another kind of calculation – electoral – that convinced the Coalition to drop the idea, and the economic numbers just provided political cover.

The Australia Institute has released data from modelling commissioned from NATSEM together with ATO statistics which show that young Australians are receiving little benefit from three of the budget’s most expensive tax concessions.  “Australians under 30 years of age receive only 6.4% of the combined tax concessions on superannuation, the capital gains tax discount and

Today, The Australia Institute has released a new paper Surprise Me When I’m Dead: Revisiting the Case for Estate Duties, which adds further analysis of the role estate taxes could play in Australia to raise revenue to and address inequality. “Congratulations to Tim Costello and the Community Council for Australia for bringing estate duties into