Research // Tax, Spending & the Budget
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September 2016
Submission: Budget Savings (Omnibus) Bill 2016
The Australia Institute submission to the Economics Legislation Committee for its inquiry into the Budget Savings (Omnibus) Bill 2016 critiques the proposed savings on the grounds that they will increase inequality and harm innovation.
Tax cuts and scrapping the Clean Energy Supplement
In the 2016 budget the government announced that it would close carbon tax compensation to new recipients of government welfare benefits. This will have the effect of reducing the amount paid to welfare recipients. This will save the government $1.3 billion over the forward estimates. The clean energy supplement was not the only part of
August 2016
Inequality & poverty in Australia: The case against the removal of the clean energy supplement
New research released by the Australia Institute today shows that government moves to cut unemployment benefits will put recipients at 32% below the poverty line. The research also highlights staggering inequality in Australia where the 10 richest Australian families have the same wealth as the poorest 3.9 million Australians combined.
July 2016
Post-election polling shows agreement on issues, expectation for politicians to negotiate with crossbench
Post-election polling of 2875 voters from across Australia showed the majority of Labor, Green and Independent voters prefer negotiations with cross bench MPs to form government rather than calling another election. 47.0% of all respondents support negotiations with independents and minor parties to form government while 46.3% said ‘call another election’. — Polling results in
June 2016
Four for One?
Are there really four dollars benefit for every one dollar company tax cut? Last year Treasury published a paper which purported to show that there was a four dollar benefit for every dollar cut in company taxes. In the paper accompanying the 2016-17 Budget, a new set of results was published which dealt directly with
Taking an educated guess
A reveiw of OECD data of the relationship between living standards and cuts in company tax rates compared with the provision of better education services.
May 2016
How will the corporate tax cut be funded?
The Coalition’s proposal to reduce the corporate tax rate will result in a significant loss of tax revenue and, in turn, will have a significant impact on the budget balance. The government has argued that the loss in tax revenue will be offset, in part, by the increase in economic activity that they believe will
Company tax cuts: An Australian gift to the US Internal Revenue Service
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.
Good economics or populism?
April 2016
From Start to Finnish
This discussion paper outlines two different possible implementations of the Finnish model. The first alternative is a direct translation of the Finnish system and would result in a loss of revenue for the state. The second alternative is a modification of the first to estimate a revenue neutral alternative.
March 2016
Company tax cuts: Report shows lack of evidence of ‘Growth Dividend’
International and Australian data on tax rates and macroeconomic indicators provides no evidence of link between corporate tax cuts and a ‘growth dividend’. Despite widespread acceptance of the argument that cutting the corporate tax rate will boost economic growth, the economic evidence is not there according to a new report from David Richardson, Senior Research
February 2016
Briefing Note: Are government plans to tackle bracket creep good for average people?
The government has spent a considerable amount of time talking about bracket creep with a particular focus on average incomes ‘creeping’ into the second top tax bracket. The government seems increasingly likely to focus any income tax cuts to prevent these average wage earners from being pushed into the second highest tax bracket. An example
Tax concessions by age
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. The research shows Australians under 30 years of age receive only 6.4% of the combined tax concessions on superannuation, the capital gains
Surprise me when I’m dead: Revisiting the case for estate duties
This paper argues that an estate tax would make a useful contribution to the government’s tax armoury. The aging of the population means that the tax base is likely to be expanding well into the future. In addition the estate duty is useful because it is levied at a time when the one who accumulated the assets no
January 2016
Finland’s Fine Example
This paper examines how the Finnish model of progressive traffic fines could work in Australia, and estimates the effect on individuals at different income levels.
Capital Gains Tax – Main Residence Exemption
The largest tax concession in Australia is the capital gains tax (CGT) exemption for themain residence. Last year it cost the budget $46 billion and is predicted to cost the budget $189 billion over the next four years. Each year the cost of the CGT exemption on for the main residence costs the federal budget more than
December 2015
Polling: Company Tax
ReachTEL conducted a survey of 738 residents across the federal electorate of Dickson, 747 residents across the federal electorate of New England, and 762 residents across the federal electorate of Page during the evining of 17th December 2015. Results in attachment below.
Revenue Polling – December 2015
There is little support in blue-ribbon Coalition electorates for using any extra revenue raised from a 15 per cent GST to cut company taxes, new polling shows. Reducing company tax rates was by far the least popular option when voters in four coalition-held electorates were asked to choose between four alternative ways to use extra revenue if the GST rate is lifted to
November 2015
Cutting the company tax rate: Why would you?
This paper attempts to critically examine proposals to cut company tax rates by looking at the circumstances of some of the main company tax-payers, namely the top 15 listed companies in Australia. The conclusion is that none of these companies are likely to significantly change their behaviour as a result of any cut in company
October 2015
University Deregulation – Polling Brief
In July 2015 The Australia Institute conducted a national opinion poll of 1408 people through Research Now. Respondents were selected to produce a representative sample based on gender, age and state. Questions relating to the performance, pay and position of the Vice Chancellors of Australia’s Universities are compiled in a polling brief available here. The
September 2015
Subsidise this
In 2015 the federal government gave $4b in subsidies to the mining and fossil fuel industry, in the previous six years the Australian government has spent $17.6b in support for these industries. Over 75% of the people agree that fossil fuel subsidies should be redirected to essential services.
Establishing a gas community benefits fund
The NSW Government is currently accepting submissions on how to establish a community benefits fund from the potential development of a coal seam gas (CSG) industry in the state. A Discussion Paper has been published by the Division of Resources and Energy. The Australia Institute has written extensively on the economics of gas in Australia.
July 2015
The goon show – How the tax system works to subsidise cheap wine and alcohol consumption
This paper presents an overview of the Wine Equalisation Tax (WET) in Australia and compares the current system with some reform alternatives and systems in other countries. When the GST was introduced in July 2000, wine products were given special tax status. While beer and spirits attract an excise based on the volume of alcohol
June 2015
Submission on 2015 Tax Discussion Paper
The Tax White Paper is an opportunity to look at areas where the tax system is failing and how to improve it. There are many ways Australia can tax smarter and reduce distortions that the current tax system creates. The Australia Institute has identified a number of areas for reform, outlined in our recent paper
Submission to the Inquiry into Home Ownership
Housing affordability is a complex issue with many moving parts. While some parts of the problem are beyond the domain of the federal government, in particular the supply of land, the federal government can play an important role in helping make housing more affordable. Loans for residential rental property have expanded rapidly, increasing from 16
Powers of deduction: Tax deductions, environmental organisations and the mining industry
Donations to environment organisations in Australia are tax deductible as long as the organisation in question is listed on the Commonwealth Register of Environmental Organisations. This listing gives an organisation Deductible Gift Recipient (DGR) status. A parliamentary inquiry is looking into the Register, largely at the behest of the mining industry. Parts of the mining
May 2015
Tax: the need for change
Prior to the 2014 Budget the Government asked the Shepherd Commission of Audit to report on public spending. They did not include in its remit the cost of tax expenditures – money which could be collected but, because of concessions, is not.