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How Australia Got a VAT

The VAT Reader, Tax Analysts, 2011

21 Pages Posted: 5 Aug 2010 Last revised: 14 Nov 2012

Susan C. Morse

University of Texas at Austin - School of Law

Date Written: August 4, 2010

Abstract

Australia got its goods and services tax – its VAT – in 2000. It enacted GST legislation through ordinary political channels, without external pressure from a multinational organization, without the pressure of an extreme national fiscal crisis and without an unusual exercise of executive authority. And the GST-enacting center-right Liberal National Party government retained control for seven years after the reform.

This paper tells the Australian story in four parts: (1) framing the GST as a relatively efficient tax; (2) building a coalition between business and social welfare interest groups; (3) emphasizing efficiency while addressing regressivity in the political and legislative process; and (4) the federalism solution included in the reform, which provided for the transfer of GST revenue to the Australian states and territories.

Suggested Citation

Morse, Susan C., How Australia Got a VAT (August 4, 2010). The VAT Reader, Tax Analysts, 2011. Available at SSRN: https://ssrn.com/abstract=1653609

Susan C. Morse (Contact Author)

University of Texas at Austin - School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States

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