Australia: Is it time for tax reform?

Authors

KONÔPKOVÁ Zlatica

Year of publication 2017
Type Article in Proceedings
Conference Hradec Economic Days 2017
MU Faculty or unit

Faculty of Economics and Administration

Citation
Web http://fim2.uhk.cz/hed/images/KOMPLET_en_17.pdf
Field Economy
Keywords Australia; tax reduction; DSGE model; productive sector
Description This paper investigates the tax reduction effects of the productive sector in Australian economy using a new Keynesian dynamic stochastic general equilibrium model for a small closed economy. The goal is to decide whether currently discussed need of tax reform in Australia is relevant and if the proposed solution can improve the situation. The effects on economy are examined using impulse response functions of shocks in the stochastic components of the taxes on labour and capital income. According to our results we suggest to implement a reform of reducing current direct taxes in favour of indirect taxes.
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