Australia is a low-taxing country. While tax debate in Australia tends to focus on tax rates, with endless comparisons of different countries’ rates of different taxes, these debates ignore the fact that Australia raises far less tax revenue than most developed countries.
This is not a problem in itself. There is no right or wrong level of taxation. However, the level of tax revenue raised inevitably affects governments’ ability to fund essential services such as health, education, social security, defence and infrastructure. Polling consistently shows that the Australian public would prefer higher levels of spending on public services than lower tax collection.
Most of the data in this report is from the Organisation for Economic Cooperation and Development (OECD), an organisation of mostly high-income countries, that share data and analysis. The OECD publishes tax data from its members which consistently shows Australia collecting among the lowest amount of tax relative to Gross Domestic Product (GDP) of OECD members.