IDEAS home Printed from https://ideas.repec.org/a/bla/ecorec/v85y2009i271p449-461.html
   My bibliography  Save this article

Trends in Effective Marginal Tax Rates in Australia from 1996–97 to 2006–07

Author

Listed:
  • ANN HARDING
  • QUOC NGU VU
  • ALICIA PAYNE
  • RICHARD PERCIVAL

Abstract

This article reviews trends in effective marginal tax rates (EMTRs) from 1996–1997 to 2006–2007 for working‐age Australians. Although sweeping income tax cuts reduced effective tax rates for many taxpayers, the extension of income‐tested welfare payments and tax concessions worked in the opposite direction. The proportion of working‐age Australians facing EMTRs of more than 50 per cent increased during the period, from 4.8 to 7.1 per cent, representing some 910,000 Australians. This article also provides the first international comparisons of how the distribution of EMTRs for earners in Australia compares with those prevailing in Europe.

Suggested Citation

  • Ann Harding & Quoc Ngu Vu & Alicia Payne & Richard Percival, 2009. "Trends in Effective Marginal Tax Rates in Australia from 1996–97 to 2006–07," The Economic Record, The Economic Society of Australia, vol. 85(271), pages 449-461, December.
    • Handle: RePEc:bla:ecorec:v:85:y:2009:i:271:p:449-461
    DOI: 10.1111/j.1475-4932.2009.00592.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4932.2009.00592.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-4932.2009.00592.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Guyonne Kalb & Thor O. Thoresen, 2007. "The Case for Labour Supply Incentives: A Comparison of Family Policies in Australia and Norway," Melbourne Institute Working Paper Series wp2007n27, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    2. Ingles, D, 1997. "Low Income Traps for Working Families," CEPR Discussion Papers 363, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    3. Productivity Commission, 2005. "Economic Implications of an Ageing Australia," Labor and Demography 0506001, University Library of Munich, Germany.
    4. Ann Harding & Quoc Ngu Vu & Richard Percival & Gillian Beer, 2005. "Welfare-to-Work Reforms: Impact on Sole Parents," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 12(3), pages 195-210.
    5. Herwig Immervoll, 2004. "Average and Marginal Effective Tax Rates Facing Workers in the EU: A Micro-Level Analysis of Levels, Distributions and Driving Factors," OECD Social, Employment and Migration Working Papers 19, OECD Publishing.
    6. Peter Whiteford, 2006. "The Welfare Expenditure Debate: ‘Economic Myths of the Left and the Right’ Revisited," The Economic and Labour Relations Review, , vol. 17(1), pages 35-77, September.
    7. Patricia Apps, 2006. "Family Taxation: An Unfair and Inefficient System," CEPR Discussion Papers 524, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nicolas Hérault & Guyonne Kalb, 2022. "Understanding the rising trend in female labour force participation," Fiscal Studies, John Wiley & Sons, vol. 43(4), pages 341-363, December.
    2. John Freebairn & Diana Warren, 2010. "Policy Forum: Saving for Retirement: Retirement Incomes and Employment Decisions of the Mature Aged," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 43(3), pages 312-320, September.
    3. Ann Harding & Robert Tanton, 2014. "Policy and people at the small-area level: using micro-simulation to create synthetic spatial data," Chapters, in: Robert Stimson (ed.), Handbook of Research Methods and Applications in Spatially Integrated Social Science, chapter 25, pages 560-586, Edward Elgar Publishing.
    4. Nicolas Herault & Francisco Azpitarte, 2014. "Recent Trends in Income Redistribution in Australia: Can Changes in the Tax-Transfer System Account for the Decline in Redistribution?," Melbourne Institute Working Paper Series wp2014n02, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    5. Peter Whiteford, 2010. "The Australian Tax‐Transfer System: Architecture and Outcomes," The Economic Record, The Economic Society of Australia, vol. 86(275), pages 528-544, December.
    6. Jinjing Li & Hai Anh La & Denisa M. Sologon, 2021. "Policy, Demography, and Market Income Volatility: What Shaped Income Distribution and Inequality in Australia Between 2002 and 2016?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 67(1), pages 196-221, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Diana Warren, 2008. "Retirement Expectations and Labour Force Transitions: The Experience of the Baby Boomer Generation," Melbourne Institute Working Paper Series wp2008n24, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    2. Creedy, John & Guest, Ross, 2008. "Changes in the taxation of private pensions: Macroeconomic and welfare effects," Journal of Policy Modeling, Elsevier, vol. 30(5), pages 693-712.
    3. Creedy, John & Guest, Ross, 2008. "Population ageing and intertemporal consumption: Representative agent versus social planner," Economic Modelling, Elsevier, vol. 25(3), pages 485-498, May.
    4. Herwig Immervoll & Henrik Jacobsen Kleven & Claus Thustrup Kreiner & Nicolaj Verdelin, 2008. "An Evaluation of the Tax-Transfer Treatment of Married Couples in European Countries," EPRU Working Paper Series 08-03, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
    5. repec:ebl:ecbull:v:8:y:2006:i:2:p:1-6 is not listed on IDEAS
    6. Kalle Hirvonen & Giulia Mascagni & Keetie Roelen, 2018. "Linking taxation and social protection: Evidence on redistribution and poverty reduction in Ethiopia," International Social Security Review, John Wiley & Sons, vol. 71(1), pages 3-24, January.
    7. H. Xavier Jara & Katrin Gasior & Mattia Makovec, 2020. "Work Incentives at the Extensive and Intensive Margin in Europe: The Role of Taxes, Benefits and Population Characteristics," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 152(2), pages 705-778, November.
    8. Gunnar Rietz & Dan Johansson & Mikael Stenkula, 2015. "Swedish Labor Income Taxation (1862–2013)," Palgrave Macmillan Books, in: Magnus Henrekson & Mikael Stenkula (ed.), Swedish Taxation, chapter 0, pages 35-122, Palgrave Macmillan.
    9. Alan Tapper & Alan Fenna & John Phillimore, 2013. "Age Bias in the Australian Welfare State," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 20(1), pages 5-20.
    10. Prosser, Brenton & Clark, Shannon & Davey, Rachel & Parker, Rhian, 2013. "Developing a public health policy-research nexus: An evaluation of Nurse Practitioner models in aged care," Evaluation and Program Planning, Elsevier, vol. 40(C), pages 55-63.
    11. Garry F. Barrett & Yi-Ping Tseng, 2008. "Retirement Saving in Australia," Canadian Public Policy, University of Toronto Press, vol. 34(s1), pages 177-193, November.
    12. Michaël Sicsic, 2018. "Financial Incentives to Work in France between 1998 and 2014," Economie et Statistique / Economics and Statistics, Institut National de la Statistique et des Etudes Economiques (INSEE), issue 503-504, pages 13-35.
    13. Y. TAMSAMANI, Yasser, 2017. "L’évolution des dépenses de santé au Maroc : une analyse des déterminants démographiques et macro-économiques [The Evolution of the Health Expenditures in Morocco: A Demographics and Macroeconomics," MPRA Paper 83996, University Library of Munich, Germany, revised 18 Jan 2018.
    14. Olivier Bargain & Mathias Dolls & Dirk Neumann & Andreas Peichl & Sebastian Siegloch, 2011. "Tax-Benefit Systems in Europe and the US: Between Equity and Efficiency," CESifo Working Paper Series 3534, CESifo.
    15. Callander, Emily Joy & Schofield, Deborah J. & Shrestha, Rupendra N., 2011. "Multi-dimensional poverty in Australia and the barriers ill health imposes on the employment of the disadvantaged," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(6), pages 736-742.
    16. Tran, Chung, 2018. "Temptation and taxation with elastic labor," Economic Modelling, Elsevier, vol. 70(C), pages 351-369.
    17. Hans Bloemen & Elena Stancanelli, 2007. "Modelling the employment and wage outcomes of spouses: is she outearning him?," Post-Print hal-01053593, HAL.
    18. Klára Kalíšková, 2020. "Tax and transfer policies and the female labor supply in the EU," Empirical Economics, Springer, vol. 58(2), pages 749-775, February.
    19. Guyonne Kalb & Thor Thoresen, 2010. "A comparison of family policy designs of Australia and Norway using microsimulation models," Review of Economics of the Household, Springer, vol. 8(2), pages 255-287, June.
    20. Bruce Chapman & Andrew Leigh, 2009. "Do Very High Tax Rates Induce Bunching? Implications for the Design of Income Contingent Loan Schemes," The Economic Record, The Economic Society of Australia, vol. 85(270), pages 276-289, September.
    21. Xiujian Peng & Dietrich Fausten, 2006. "Population Ageing And Labour Supply Prospects In China From 2005 To 2050," Monash Economics Working Papers 16/06, Monash University, Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecorec:v:85:y:2009:i:271:p:449-461. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/esausea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.