IDEAS home Printed from https://ideas.repec.org/a/tsy/journl/journl_tsy_er_2014_1_3.html
   My bibliography  Save this article

The incidence of company tax in Australia

Author

Listed:
  • Xavier Rimmer

    (Treasury, Government of Australia)

  • Jazmine Smith

    (Treasury, Government of Australia)

  • Sebastian Wende

    (Treasury, Government of Australia)

Abstract

This paper uses a computable general equilibrium framework to provide estimates of where the costs of company tax are borne and to test the importance of certain assumptions. The welfare benefits of a small fall in the company tax rate are shared between company owners and workers. The paper finds that in the long-run around one-third of the benefit accrues to the owners of capital in the main scenario, with the remaining two-thirds flowing to households, primarily through rises in real wages. Results with alternative assumptions are also presented.

Suggested Citation

  • Xavier Rimmer & Jazmine Smith & Sebastian Wende, 2014. "The incidence of company tax in Australia," Economic Roundup, The Treasury, Australian Government, issue 1, pages 33-47, April.
  • Handle: RePEc:tsy:journl:journl_tsy_er_2014_1_3
    as

    Download full text from publisher

    File URL: http://www.treasury.gov.au/~/media/Treasury/Publications%20and%20Media/Publications/2014/Economic%20Roundup%20Issue%201/Downloads/PDF/03_Incidence_of_company_tax_in_Australia_v3.ashx
    Download Restriction: no

    References listed on IDEAS

    as
    1. Harberger, Arnold C., 2008. "The Incidence of the Corporation Income Tax Revisited," National Tax Journal, National Tax Association;National Tax Journal, vol. 61(2), pages 303-312, June.
    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. Chris Murphy, 2016. "The effects on consumer welfare of a corporate tax cut," Departmental Working Papers 2016-10, The Australian National University, Arndt-Corden Department of Economics.
    2. J.M. Dixon & J. Nassios, 2016. "Modelling the Impacts of a Cut to Company Tax in Australia," Centre of Policy Studies/IMPACT Centre Working Papers g-260, Victoria University, Centre of Policy Studies/IMPACT Centre.
    3. Michael Kouparitsas & Dinar Prihardini & Alexander Beames, 2016. "Analysis of the long term effects of a company tax cut," Treasury Working Papers 2016-02, The Treasury, Australian Government, revised May 2016.

    More about this item

    Keywords

    CGE; Computable General Equilibrium; company taxation; economic incidence; economic rents; capital mobility;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

    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:tsy:journl:journl_tsy_er_2014_1_3. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (The Treasury (Commonwealth of Australia)) or (Lisa Gilmore). General contact details of provider: http://edirc.repec.org/data/trgovau.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.