In 2009, Australia’s state and federal tax policy underwent a comprehensive review. The resulting Henry Tax Review made many recommendations to improve the resilience, equity and efficiency of the tax system.
Ten years on, the issues raised in the Review remain as relevant as ever.
Today’s Melbourne Economic Forum revisited these important issues, and discussed state and federal tax reform options, the incentive and distributional effects of interactions between tax and transfer policy, and ways to promote investment without cutting company tax.
Professor Peter Dawkins AO, Vice-Chancellor and President of Victoria University, delivered the introduction and facilitated the panel discussion with some of Australia’s most the influential policy thinkers from the University of Melbourne and Victoria University.
VU’s John Freebairn discussed the “often conflicting but sometimes complementary reasons for tax reform” including: change revenue; redistribute for equity; reduce distortions to increase productivity; and, simplicity to save operating costs.
The University of Melbourne’s Professor Guyonne Kalb added a gender lens and focused on how “the interactions between tax and transfer policy (e.g. including family benefits and childcare subsidies) can have the unintended consequence of creating a welfare trap.”
Jason Nassios delivered a new paper on economic modelling of company tax cuts that VU Economist Janine Dixon says “debunks the notion that this would have been beneficial for ordinary Australians.” Dixon closed the forum by posing the question: how can investment allowance stimulate investment and wages without harming national income?
More about the Melbourne Economic Forum.