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Optimal Commodity Taxes in Australia


Blacklow, P and Ray, R, Optimal Commodity Taxes in Australia, The Australian Economic Review, 35, (1) pp. 45-54. ISSN 0004-9018 (2002) [Refereed Article]

DOI: doi:10.1111/1467-8462.00222


The recent changes to commodity taxes in Australia have led to renewed interest in a classic question in public finance: should the tax rates be uniform or differentiated? This article attempts to answer this question by calculating optimal commodity taxes in Australia for a nine-item disaggregation. The estimates point to non-uniform commodity taxes, even from the viewpoint of an inequality-insensitive tax planner. The optimal commodity taxes bear little resemblance with the pre-GST or post-GST tax rates. No less significant is our observation that even the purely efficiency-driven optimal commodity taxes imply lower real expenditure inequality than the actual taxes.

Item Details

Item Type:Refereed Article
Research Division:Economics
Research Group:Applied economics
Research Field:Welfare economics
Objective Division:Economic Framework
Objective Group:Microeconomics
Objective Field:Microeconomic effects of taxation
UTAS Author:Blacklow, P (Dr Paul Blacklow)
UTAS Author:Ray, R (Professor Ranjan Ray)
ID Code:25508
Year Published:2002
Deposited By:Economics and Finance
Deposited On:2002-08-01
Last Modified:2003-05-29

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