Taxation with misrepresentation: Australia's Revenue lobby in denial

The revenue lobby has propagated a range of myths over the years in order to sustain Australia¿s high tax regime. The first myth is an absolute denial: Australia is a 'low-tax' economy. Comparisons with other regional economies, and even the OECD, however, show this argument to be false. A second myth is high progressive personal taxes compensate for 'regressive' indirect taxes. A third myth is taxes only appear to be high, but avoidance is so common that, in fact, taxes on the rich are low. In any event, progressive taxes are 'fair'. The 'rich' can afford to pay more, and so on. Readers will note, however, that each argument is a retreat from a previous position. Ultimately, however, these myths are an inter-related web of distortions, evasions, and half-truths designed to stifle public understanding and rational debate on the tax burden borne by Australians. The level of confusion is so great that the Greens were able to state in their 2004 election economic policy 'At present, Pay As You Go (PAYG) taxpayers on low to middle incomes pay more tax in proportion to their income than people on high incomes'.