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Taxing Super
Author(s) -
Doyle Suzanne,
Kingston Geoffrey,
Piggott John
Publication year - 1999
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/1467-8462.00109
Subject(s) - earnings , equity (law) , tax reform , economics , cash flow , labour economics , state income tax , wage , pension , public economics , personal income tax , tax credit , tax revenue , revenue , business , finance , gross income , political science , law
Australia’s taxation arrangements for retirement saving are among the most complicated in the world. It is almost unique in applying taxat all three possible points in the retirement saving cycle: contributions, earnings and benefits. Starting from the proposition that the ‘best’ pension tax is to tax benefits under the personal income tax, this paper proposes a ‘withholding tax’ arrangement which would have impacts on individual contributors equivalent to a benefit tax, while altering the time profile of tax collections to address cash‐flow concerns on the part of the revenue authorities. Simulations are presented to show that individual contributors benefit from the proposed reform, and that equity across contributors in different wage bands is broadly maintained.