The Economy, Stupid How To Fix Tax?
Jun 26, 2025
Miranda Stewart, Director of Tax Law at the University of Melbourne, and Ben Phillips, Principal Research Fellow at the ANU, dissect the complexities of Australia’s tax system. They delve into tax fairness, highlighting generational inequalities in superannuation and the burden on younger workers. The duo discusses the intricate relationship between tax reforms and economic growth, and tackle the challenges tied to Australia’s franking credit system and GST. Their insights spark ideas for a more equitable and efficient tax landscape.
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Goals of Tax Reform
- Tax reform aims include boosting productivity, ensuring fairness, and raising revenue.
- Productivity gains are important but fairness, particularly intergenerational fairness, may have larger impact.
Super Tax and Fairness Issue
- Older Australians often pay little to no tax on superannuation income, while younger workers face higher tax rates.
- This raises significant intergenerational fairness concerns in Australia's tax system.
History of Super Exemptions
- The generous tax exemptions on superannuation in the retirement phase were introduced in the 2000s under Treasurer Costello and Treasury Head Ken Henry.
- That policy era had high growth and surpluses, but hindsight shows the exemption was a mistake for current times.