Hundreds and thousands: bunching at positive, salient tax balances and the cost of reducing tax liabilities
Australian taxpayers display reference-dependent preferences when filing their tax returns - they bunch at positive and salient thresholds. In this paper, the authors develop a model of taxpayer behaviour to show that bunching heterogeneity reflects both differences in preferences and the rate at which the...
This report assesses the effectiveness of using United States income tax data for the purpose of automatic voter registration or re-registration, focusing on the level of match between each state’s standard individual income tax form and its voter registration requirements.
In this working paper, the authors provide a unified analysis of taxation and taxpayer education when individuals have an incomplete understanding of a complex tax system. The analysis is independent of whether income is earned legitimately, or by avoiding or evading taxes.
The stage 3 tax cuts, worth $15.7 billion per year will come into effect in July 2024, while the Low- and Middle-Income Tax Offset (LMITO), worth $7 billion per year is due to end this year. This paper looks at the distribution of the tax...
Building on research and analysis published by Grattan Institute since it was founded 13 years ago, this report identifies reforms to boost incomes, improve health and education, create better transport links, make housing more affordable, generate meaningful progress on climate change, and strengthen Australia’s political...
The Australian government has claimed that young women are some of the biggest beneficiaries of their income tax cuts over recent years. This analysis shows that the stage 3 tax cuts, which the government has committed to introduce after the next election, will see most...
This electorate analysis of the Morrison Government’s current plan to scrap the Low and Middle Income Tax Offset (LMITO) after 2021-22 shows most taxpayers will be worse off when the legislated Stage 3 tax cuts to high income earners comes into effect in 2024-25.
'Bracket creep' is a term that describes a situation where income growth causes individuals to pay higher average income tax rates each year. This explainer examines the impact of bracket creep from the perspective of both individuals and government finances.
An Employee Share Scheme (ESS) is a scheme where employers offer shares or options to an employee in relation to their employment. This report highlights the benefits, but also the difficulties in measuring the usage of ESS in Australia, and also examines the effectiveness of...
The ATO Longitudinal Information Files (ALife): Individuals - a new dataset for public policy research
This working paper provides an overview of the ATO's 'ALife - Individuals' dataset and outlines some of the possibilities for public policy research and evaluation that will improve understanding of taxpayer behaviour and support policy development.
The Per Capita Tax Survey 2021 provides valuable insights into public sentiment towards the federal government’s role in the post-COVID recovery, and can be used as a valuable resource for policy-makers in the months ahead.
This discussion paper proposes a straightforward and achievable tax reform—a standard deduction—that would lift billions of dollars worth of dead weight off taxpayers' shoulders every year.
After the tumult of the Whitlam Government, the Fraser Government (1975-1983) saw consolidation with less reform. The 1975 Asprey report remained largely unactioned, despite the fundamental problems that burdened the Australian tax system. The 1983 election of the Hawke Government, however, set in train a...
In the paper, the authors study the incidence of capital income taxation in a dynamic general equilibrium model with heterogeneous firms and lifecycle households.
This paper uses data from 18 OECD countries over the last five decades to estimate the causal effect of major tax cuts for the rich on income inequality, economic growth, and unemployment.
The ultimate way to measure the success of any government-backed stimulus project is by how much additional employment it creates. This paper estimates the additional employment that bringing forward stage 2 of the proposed income tax cuts might create.
The tenth annual Per Capita tax survey provides an unparalleled insight into the views held by Australians of all ages, from across the country, about the role of tax and public services in our national life. It provides valuable insights to policy makers for the...
In Australia’s first five decades as a Federation, tax reform efforts were driven by the need to establish robust revenue bases for a growing nation and settle relative taxing responsibilities of the Commonwealth and state governments. These decades were also a time of crises with...