Download This PaperIn the Zone: Tax Relief for the Australian Bush
This article has first appeared in "The Tax Specialist " 22(5) 01 July 2019 and has been reproduced with permission from the Tax Institute
15 Pages Posted: 13 Apr 2020 Last revised: 30 Nov 2025
Date Written: July 1, 2019
Abstract
This article examines the erosion of the Australian zone tax concession, originally introduced in 1945 to compensate residents of remote and climatically harsh regions for higher living costs, isolation and uncongenial environmental conditions. At its inception, the £40 annual concession represented approximately 12% of the average weekly income.
By 2018, although the concession had increased to $338, it had fallen to only 0.39% of average income for most remote residents. The paper argues that the concession’s real value has been substantially eroded and no longer reflects the relative disadvantage it was designed to offset.
It concludes that restoring the concession to its original comparative value is necessary to maintain equity between remote taxpayers and those in more favourable regions, and to ensure the concession continues to fulfil its compensatory purpose.
Keywords: Taxation, Income Tax, Tax Concessions, Remote Area Tax Offsets, Regional Disadvantage, Cost of Living, Climate Compensation, Australian Tax Policy, Fiscal Equity, Public Finance
JEL Classification: H2, K34, H24, H23, R11
Suggested Citation: Suggested Citation