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The Ralph Report Depreciation Proposals and Investment Neutrality


  • Benge, M.


The Review of Business Taxation chaired by Mr John Ralph has suggested sweeping changes to business taxation in Australia. In particular it has been proposed that accelerated depreciation provisions be removed to finance a reduction in the company tax rate. If some degree of accelerated depreciation is to be retained, it is suggested that this should involve a uniform loading on depreciation rates for all assets. The aim is to provide a more uniform treatment of assets with different economic lives. This paper examines the neutrality of these proposals for unincorporated enterprises and companies owned by Australian shareholders.

Suggested Citation

  • Benge, M., 1999. "The Ralph Report Depreciation Proposals and Investment Neutrality," ANU Working Papers in Economics and Econometrics 1999-371, Australian National University, College of Business and Economics, School of Economics.
  • Handle: RePEc:acb:cbeeco:1999-371

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    References listed on IDEAS

    1. Kopcke, Richard W, 1981. "Inflation, Corporate Income Taxation, and the Demand for Capital Assets," Journal of Political Economy, University of Chicago Press, vol. 89(1), pages 122-131, February.
    2. Mervyn A. King, 1974. "Taxation and the Cost of Capital," Review of Economic Studies, Oxford University Press, vol. 41(1), pages 21-35.
    3. Paul A. Samuelson, 1964. "Tax Deductibility of Economic Depreciation to Insure Invariant Valuations," Journal of Political Economy, University of Chicago Press, vol. 72, pages 604-604.
    4. Benge, M., 1999. "Marginal Excess Burdens of Taxes on Capital and on Labour Income in a Small Open Economy," Papers 364, Australian National University - Department of Economics.
    5. Benge, Matt, 1998. "Depreciation Provisions and Investment Incentives under Full Imputation," The Economic Record, The Economic Society of Australia, vol. 74(227), pages 329-345, December.
    6. Auerbach, Alan J, 1979. "Inflation and the Choice of Asset Life," Journal of Political Economy, University of Chicago Press, vol. 87(3), pages 621-638, June.
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    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies


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