Recent OECD data offer limited support for the proposition that our company tax rate could be cut
substantially with little or no loss of tax revenue. Treasury‐type analysis suggests otherwise: our
headline rate could be cut to 20 per cent if abolishing dividend imputation were used to finance a
cut in the headline rate. But this type of exercise relies on strong assumptions, and imputation
mitigates other idiosyncrasies of our tax system. Accordingly, abolition of imputation should await a
cut in our top marginal personal rate along with a transition to back‐end taxation of most
superannuation accounts.