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Disparities in average rates of company tax across industries

Author

Listed:
  • Peter Greagg

    (Treasury, Government of Australia)

  • Dean Parham

    (Treasury, Government of Australia)

  • Pero Stojanovski

    (Treasury, Government of Australia)

Abstract

The effect of company tax arrangements across Australian industries has received relatively little attention.This article finds evidence that average tax rates vary considerably across industries. The evidence is found to be reasonably robust with external validation used to confirm results. The average tax rate is found to be relatively high in the finance and insurance industry and relatively low in the most capital-intensive industries, such as electricity, gas and water, and mining. Variations in average tax rates across industries would be expected to have an impact on the way investment is allocated across industries, potentially with a negative impact on productivity and growth. Changes to the company tax rate would be expected to have differing impacts across industries arising from the variations in average tax rates.

Suggested Citation

  • Peter Greagg & Dean Parham & Pero Stojanovski, 2010. "Disparities in average rates of company tax across industries," Economic Roundup, The Treasury, Australian Government, issue 2, pages 91-103, July.
  • Handle: RePEc:tsy:journl:journl_tsy_er_2010_2_3
    as

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    File URL: http://archive.treasury.gov.au/documents/1846/PDF/07_Disparities_in_average_tax_rates.pdf
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    References listed on IDEAS

    as
    1. Kevin S. Markle & Douglas Shackelford, 2009. "Do Multinationals or Domestic Firms Face Higher Effective Tax Rates?," NBER Working Papers 15091, National Bureau of Economic Research, Inc.
    2. Alan Auerbach & Michael P. Devereux & Helen Simpson, 2007. "Taxing Corporate Income," CESifo Working Paper Series 2139, CESifo Group Munich.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Sinclair Davidson, 2012. "Treasury Forecasts of Company Tax Revenue: Back of the Envelope or Back to the Drawing Board?," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 19(2), pages 53-62.

    More about this item

    Keywords

    corporate tax; tax incidence;

    JEL classification:

    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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