This paper is written in partnership with Australia21. Australia has a long and proud tradition of equality, but in recent decades the benefits of strong economic growth have flowed disproportionately to the rich. In the wake of a declining resources boom, there is a growing gulf between those in the top range and those in the lower ranges of wealth

The Australia Institute made a submission to the Senate Economics Legislation Committee on the Tax Laws Amendment (Temporary Budget Repair Levy) Bill 2014 and related bills. This levy has the effect of increasing the marginal tax rate from 45 to 47 per cent on incomes over $180,000. Inclusive of the Medicare Levy and the DisabilityCare

Governments are not like businesses. They provide services because the citizens demand them, not because delivering them is profitable. They collect taxes from citizens, not charge prices from customers. While a business has a legal responsibility to maximise the dividends it pays its shareholders, it makes no sense for a government to generate a surplus

As Australia’s population ages, government policies that assist retirement will become even more essential. Superannuation tax concessions and the age pension are the two key government policies that assist the ageing, but they are becoming increasingly expensive. Increasing costs have prompted the Treasurer, Mr Joe Hockey to suggest the pension age be increased to 70.

Submission to the Senate Inquiry into Minerals Resource Rent Tax Repeal and Other Measures Bill 2013. 

Most politicians claim that creating jobs is top of the agenda – but public sector jobs are a different matter. The Coalition has promised to cut at least 12,000 jobs in the public sector if it wins government, hoping to portray these jobs as superfluous and implying that getting rid of them will make everyone

The federal government is pouring an extra half a billion dollars into taxpayer-funded subsidies to the mining industry, research by The Australia Institute has found. The Institute’s new paper Pouring more fuel on the fire reveals the booming sector has been propped up even further over the past year and now receives $4.5 billion from

The government would have had an additional $38 billion for last year’s federal government budget and would have collected an extra $169 billion over the past seven years had it not been for unsustainable income tax cuts that were made in the lead up to the GFC. Had the income tax cuts not been made,

Superannuation is unlike any other product in Australia. There is no other product that all employees are forced to spend nine per cent of their income buying. In fact, the proportion of income spent on compulsory superannuation is to rise to 12 per cent by 2020. But it is not just individuals that spend a

Some industries have far more political influence than others, and some political systems are more susceptible to the influence of industries than others. In Australia, the Independent Commission Against Corruption (ICAC) is currently investigating evidence of the links between the previous NSW Labor Government and the mining industry. In the words of Geoffrey Watson, QC,

It is often argued that reductions in the corporate tax rate are necessary to create employment, increase investment and deliver a range of other benefits to the Australian community. However, despite the widespread support for this view, particularly among the business community, the theoretical and empirical case for such an expensive change in policy is

The introduction of the Goods and Services Tax (GST) in July 2000 by the Howard Government was, we were told, likely to lead to a significant reduction in the size of the ‘cash’ or ‘black’ economy. The 2003 report to the then Tax Commissioner from the Cash Economy Task Force stated: The new tax system

Australian taxpayers contributed $30.2 billion to the private accounts of that portion of the population with superannuation 2011-12. By 2015-16 this sum is projected by Treasury to rise to more than $45 billion by which time it will be, by far, the single largest area of government expenditure. By 2015-16 the taxpayer contribution of $45

The role of unemployment benefits is to insulate people from the severe financial hardship of going to work one day and discovering that they no longer have a job. Few people earning $60,000 per year, raising children and attempting to repay their home loan can afford to remain unemployed for more than a few months

The mining industry is receiving substantial assistance from Australian taxpayers worth more than $4 billion per year in subsidies and concessions from the Federal Government alone. Amazingly, this is at a time when the industry is earning record profits. Significantly, these subsidies and tax concessions do not even include the cost of providing the mining

The Australian mining boom has been driven by rapidly rising world commodity prices. Put simply, the world is now willing to pay much higher prices for our coal, iron ore, gold and other resources than they were 10 years ago. For example, gold prices have risen from about 400 $US/ounce in 2004 to about 1600

“When I began the study of economics some forty one years ago, I was struck by the incongruity between the models that I was taught and the world that I had seen growing up” – Nobel Prize Winning Economist Joseph Stiglitz. Economic modelling has, for many people involved in Australian policy debates, become synonymous with

The Gillard Government recently passed legislation which will, for the first time in Australia, see big polluters pay for their greenhouse gas emissions through a price on carbon. While the introduction of a carbon price will not in itself drive a substantial reduction in Australia’s emissions, it does begin to build the necessary policy infrastructure

When sick, the doctor is the first port of call for most Australians. In 2009-10 one in five visits to a GP resulted in extra fees over and above the Medicare scheduled fee. An estimated $557 million extra were paid for these visits. While the government encourages GPs to charge the scheduled fee (known as

It is often said that to retire with dignity in Australia a couple would need a retirement income of around $50,000 per year. In order to help Australians achieve such levels of retirement incomes Australian taxpayers now contribute around $27 billion per year in tax concessions to help boost the retirement savings of so called

There has been much debate recently about the way that wine sold in Australia should be taxed. The proposal by the Henry Tax Review to move from the current ad valorem tax to a volumetric tax, bringing wine in line with other types of alcoholic drinks, has been fiercely challenged by some in the wine

“The future is in our hands, and it will be defined by the way we handle the current minerals boom. Get it wrong, and we falter. Get it right, and we set the nation up for decades to come.” Prime Minister, the Hon. Julia Gillard The Australian economy, like all modern economies, is diverse and

In the 2007 federal election both major parties committed to introducing an Emissions Trading Scheme (ETS). By 2009 both parties agreed on an emissions reduction target of five per cent on 2000 levels by 2020. But since Tony Abbott became leader of the Liberal Party the bipartisan position for a reliance on a market based

The Coalition has committed to reducing greenhouse gas emissions by five per cent on 2000 levels by 2020. It proposes to achieve this target with a “Direct Action Plan”: a competitive grant scheme that would buy greenhouse gas reductions from businesses and farmers. Over the past decade various Australian governments have announced more than seven

The Gillard Government is committed to introducing a price on carbon pollution by July 2012 however the details of the price, the sectors of the economy that will be covered by the scheme and the design features of the compensation package that is likely to accompany the carbon price are currently being negotiated by the

The federal budget presents a complex management puzzle that all governments have to address and explain to the electorate. Sometimes concepts are borrowed from the corporate sector and sometimes analogies are made with the household sector; the Howard Government, in particular, imported numerous corporate accounting concepts. But often these concepts are applied uncritically and inappropriately.

The introduction of a carbon price in Australia in July 2012 will raise more than $10 billion per year, help influence industrial and household decision making and, inevitably, increase the costs and reduce the profits of some businesses. Such increases in cost and the subsequent change in behaviour are, of course, the objective of introducing

On 30 September 2010, the Select Committee on New Taxes initiated an inquiry into the following matter: (a) new taxes proposed for Australia, including: (i) the minerals resource rent tax and expanded petroleum resource rent tax, (ii) a carbon tax, or any other mechanism to put a price on carbon, and (iii) any other new

The Australian tax-transfer system targets those in need and, as a consequence, is prone to poverty traps, areas where higher private income leads to very little gain in disposable income, and high effective marginal tax rates (EMTRs) in general. This can severely impact on people’s ability to work their way out of poverty. Particularly acute

While the 2007 election was fought on a promise by the ALP to introduce a carbon price the 2010 election was fought by both the ALP and the Coalition on a promise not to do so. For the ALP the promised inaction was until at least 2013 and for the Coalition the promise was open