Buying better income taxes with better land taxes

Cameron Murray and Tim Helm
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Cameron Murray: The University of Sydney
Tim Helm: Independent economic consultant

No zmypn, OSF Preprints from Center for Open Science

Abstract: Income tax and welfare withdrawal together penalise additional work effort by generating effective marginal tax rates (EMTRs) on extra income that are often as high as 75-80%. Flatter rate structures to provide fairer and more efficient returns to work require either lower top welfare payments, higher top tax rates, or reform of the tax mix. Levelling state taxes on land up to the benchmark set by the ACT could raise as much as $27 billion more in revenue each year without reducing investment or growth. With changes to Commonwealth-state grants, this could fund a halving of all welfare withdrawal rates, producing an effective tax cut of 20-30 cents in the dollar for over one million workers and extra cash in the pocket for around two million more.

Date: 2024-03-17
New Economics Papers: this item is included in nep-pbe and nep-pub
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Persistent link: https://EconPapers.repec.org/RePEc:osf:osfxxx:zmypn

DOI: 10.31219/osf.io/zmypn

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