Show host Gene Tunny and Australian Taxpayers’ Alliance Chief Economist John Humphreys tackle hot topics in Australian economic policy: the case for a cash flow company tax, the politics and maths of a gas ban, why stamp duty drags the economy, the growing size of government and the cost of living crisis.
Please email Gene your thoughts on this episode via contact@economicsexplored.com.
Timestamps
- Introduction and Greens’ Gas Ban (0:00)
- Government Spending and Adverse Effects on Economic Dynamism (8:32)
- Stamp Duty and Efficiency Cost (19:42)
- Inflation Data and Cost of Living Crisis (25:39)
- Productivity Commission's Company Tax Reform (28:55)
- Workers' Compensation and Tax Incidence (43:11)
- Tariffs and Taxation (54:52)
Takeaways
- Cash Flow Tax Reform – The Productivity Commission proposes cutting company tax to 20% for most firms, adding a 5% cash flow tax, and keeping the system revenue neutral—aimed at boosting investment.
- Gas Ban Impact – John argues the NSW Greens’ proposal would delay global warming by only 10 hours by 2100, even under optimistic assumptions, yet could raise costs for consumers and businesses.
- Stamp Duty Inefficiency – Economic modelling by the Centre of Policy Studies (CoPS) shows stamp duty’s deadweight loss at 70–80 cents per $1 raised, far worse than GST or income tax.
- Government Spending Growth – The CIS’s Robert Carling claims over half of Australians now earn primary income from government sources, raising concerns about productivity and political incentives.
- Hidden Tax Burdens – Workers’ compensation costs, though nominally paid by employers, often reduce workers’ wages in the long run, John argues.
Links relevant to the conversation
ATA livestream on 7 August:
https://austaxpayers.substack.com/p/australia-considers-cashflow-tax
John’s article on Greens’ gas ban:
https://austaxpayers.substack.com/p/greens-propose-gas-ban
PC’s cash flow tax proposal:
https://www.pc.gov.au/inquiries/current/resilient-economy/interim
Leviathan on the Rampage: Government spending growth a threat to Australia’s economic future
https://www.cis.org.au/publication/leviathan-on-the-rampage-how-the-growth-of-government-is-draining-australias-economic-vitality/
CoPS on stamp duty: Some taxes are inefficient at any level. Even modest reforms will help
https://www.vu.edu.au/about-vu/news-events/news/some-taxes-are-inefficient-at-any-level-even-modest-reforms-will-help
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