Peter Costello

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OECD Revenue Statistics 2006 Edition



Australia is the eighth lowest taxing country in the 30 member OECD according to the latest edition of OECD Revenue Statistics.  The chart below shows the member countries’ total taxation as a percentage of GDP for the most recent reporting year, 2004 (Australia’s 2004-05 financial year).

Since the 2004-05 financial year, the Government has delivered personal income tax cuts totalling $73.8 billion over five years as a result of the announcements in the 2005‑06 and 2006‑07 Budgets.  These personal income tax cuts include those from the superannuation package first announced in the 2006-07 Budget.

Revenue Statistics reports the combined accrual revenue collections at federal, state and local government levels.  For the Australian Government, taxation cash receipts decreased from 23.1 per cent of GDP in 1996-97 to 21.0 per cent of GDP in 2004-05.

Our lower tax to GDP position is consistent with the lower spending to GDP position that has come from disciplined fiscal management. As OECD statistics show, the government spending to GDP ratio in Australia has dropped from 38.2 per cent in 1995 to 35.1 per cent in 2004.

Australia’s total wage and salary tax take as a proportion of GDP is low compared with the OECD.  Australia’s direct taxation on individuals and payroll is the fourth lowest of the 30 members of the OECD taking into account personal income taxes, payroll taxes and social security contributions.

Australia, and New Zealand are the only two countries in the OECD that do not impose taxes in the form of social security contributions, which now have become the largest single source of tax revenue in OECD countries, larger than total personal income taxes.

Australia’s overall tax mix between direct and indirect taxes remains in the middle of OECD countries.  As indicated in the recent International Comparison of Australia’s Taxes, there are differences between Australia and other OECD countries on more detailed elements of this tax mix.

11 October 2006

Renae Stoikos

02 6277 7340

Total taxation revenue as a percentage of GDP, 2004

Total taxation revenue as a percentage of GDP, 2004

12 Oct 2006

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