A Dual Income Tax System for Australian Small Business: Achieving Greater Tax Neutrality?

20(1) Journal of Australian Taxation 94-121

Griffith University Law School Research Paper No. 18-29

29 Pages Posted: 7 Nov 2018 Last revised: 26 Jan 2019

See all articles by Barbara Trad

Barbara Trad

Griffith University, Students

Brett Freudenberg

Griffith University - Griffith Business School; Griffith University - Griffith Law School

Date Written: October 2, 2018

Abstract

This article explores the notion of tax neutrality and its relationship to the taxation of business structures, especially for Australian small businesses. In particular, it analyses whether the introduction of a dual income tax (DIT) system, as advocated by Pitcher Partners could achieve this. It will be argued that a DIT does have the potential to improve tax neutrality and may remove business structural biases that exist in Australia. Furthermore, it will be argued that steps towards tax neutrality would be likely to be achieved through greater alignment of the individual marginal tax rates and that with businesses.

Keywords: Dual Income Tax, Tax Neutrality, Small Business, Tax Reform, Australia

JEL Classification: K34, H25, H21

Suggested Citation

Trad, Barbara and Freudenberg, Brett, A Dual Income Tax System for Australian Small Business: Achieving Greater Tax Neutrality? (October 2, 2018). 20(1) Journal of Australian Taxation 94-121 ; Griffith University Law School Research Paper No. 18-29. Available at SSRN: https://ssrn.com/abstract=3258966

Barbara Trad

Griffith University, Students ( email )

Nathan, QLD
Australia

Brett Freudenberg (Contact Author)

Griffith University - Griffith Business School ( email )

Brisbane, Queensland 4111
Australia

Griffith University - Griffith Law School ( email )

Nathan Campus, GU
Nathan 4111
Australia

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