COVID-19 Has Exposed the Weaknesses in the Australian Tax System: Tax Reform Will Be Required for Recovery

21 Pages Posted: 6 Aug 2020

See all articles by Tristram Sainsbury

Tristram Sainsbury

Australian National University (ANU) - Crawford School of Public Policy

Robert V. Breunig

Australian National University (ANU) - Crawford School of Public Policy; Tax and Transfer Policy Institute (Crawford School of Public Policy, ANU); IZA Institute of Labor Economics

Date Written: August 1, 2020

Abstract

The economic shock and government response to COVID-19 highlight weaknesses in Australia’s tax system. COVID-19 puts pressure on a system under strain from long-term structural forces and the tax-free and tax-reduced status of certain sources of income. Returning to a sound structural budget position cannot be accomplished through passive action that relies on ‘natural’ revenue growth from current tax sources. Discussions should focus on comprehensive reform. Reducing reliance on income (particularly labour) taxes and applying a more equal tax treatment to different individuals and income sources over time are priorities which will support improved well-being and labour market activity.

Keywords: COVID-19; Tax reform

JEL Classification: H20, H21, H24, J08

Suggested Citation

Sainsbury, Tristram and Breunig, Robert V., COVID-19 Has Exposed the Weaknesses in the Australian Tax System: Tax Reform Will Be Required for Recovery (August 1, 2020). Tax and Transfer Policy Institute - Working paper 10/2020, Available at SSRN: https://ssrn.com/abstract=3632675 or http://dx.doi.org/10.2139/ssrn.3632675

Tristram Sainsbury (Contact Author)

Australian National University (ANU) - Crawford School of Public Policy ( email )

ANU College of Asia and the Pacific
J.G. Crawford Building, #132, Lennox Crossing
Canberra, Australian Capital Territory 0200
Australia

Robert V. Breunig

Australian National University (ANU) - Crawford School of Public Policy ( email )

7 Liversidge Street
Lennox Crossing
Canberra, ACT 0200
Australia
61261252148 (Phone)

HOME PAGE: http://https://crawford.anu.edu.au/crawford_people/content/staff/rbreunig.php

Tax and Transfer Policy Institute (Crawford School of Public Policy, ANU) ( email )

Canberra
Australia

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
209
Abstract Views
1,576
Rank
269,987
PlumX Metrics