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International trends in company tax rates — implications for Australia’s company income tax

Author

Listed:
  • James Kelly

    (Treasury, Government of Australia)

  • Robert Graziani

    (Treasury, Government of Australia)

Abstract

Worldwide statutory company tax rates have been declining. The choice of Australia’s statutory company tax rate is a balancing act, as Australia’s company income tax system has two basic roles. The first, to tax the income of Australian residents, is not affected directly by the international trend. The second, to tax the Australian source income of foreign investors, may be affected by that trend. Reducing Australia’s company tax rate (to reduce tax on foreign investors) could, but may not, improve national welfare by increasing foreign investment in Australia. Australia’s current statutory company tax rate is around the OECD average and is less than or equal to the rates in our major sources and destinations of foreign investment.

Suggested Citation

  • James Kelly & Robert Graziani, 2004. "International trends in company tax rates — implications for Australia’s company income tax," Economic Roundup, The Treasury, Australian Government, issue 3, pages 23-47, November.
    • Handle: RePEc:tsy:journl:journl_tsy_er_2004_3_2
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    File URL: http://archive.treasury.gov.au/documents/930/PDF/02_International.pdf
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    References listed on IDEAS

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    Cited by:

    1. John Hawkins, 2006. "The Concept of Competitiveness," Treasury Working Papers 2006-02, The Treasury, Australian Government, revised Apr 2006.

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    More about this item

    Keywords

    Australia; company tax; corporate tax; foreign investment; taxation;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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