Transcript Resource investment – major projects

ENHANCING OUR LIVING STANDARDS
THROUGH TAX REFORM
Dr Martin Parkinson
Secretary to the Treasury
1
Real GDP growth
6
Per cent
Per cent
Projections
Forecasts
5
6
5
20-year average
4
4
3
3
2
2
1
1
0
0
1997-98
2001-02
2005-06
2009-10
2013-14
2017-18
Source: ABS cat. no. 5206.0 and Treasury.
2
Contributions to annual per capita
income growth
4
Percentage points
contribution, annual
average
Percentage points
contribution, annual
average
4
3
3
2
2
1
1
0
0
-1
-1
1960s
1970s
1980s
1990s
Labour utilisation
Net foreign income
Terms of trade
Per capita income growth
2000 to 2013
2014 to 2025
Labour productivity
Note: The hatched area represents the additional labour productivity required to achieve long run average growth in real gross national income per capita.
Source: ABS 5204.0 and Treasury
Tax structure
1950-51
Personal income tax
Other
Corporate income taxes
Indirect tax
2014-15
Personal income tax
Indirect tax (ex GST)
Source: RBA statistics, Budget 2014-15 and Treasury estimates.
Corporate income taxes
GST
2024-25
Personal income tax
Indirect tax (ex GST)
Corporate income taxes
GST
Increasing investment in intangibles
14
Per cent of GDP
Per cent of GDP
14
12
12
10
10
8
8
6
6
4
4
2
2
0
0
US intangible investment
Source: The Conference Board
US tangible investment
Personal income tax rates and the effects
of fiscal drag
200
$thousands
$thousands
180
200
180
Average full-time employee
hits 2nd highest tax bracket
(2015-16)
160
160
140
140
120
120
100
Average ordinary full time
earnings
100
80
80
60
60
40
40
20
20
0
1994-95
0
1998-99
2002-03
First tax threshold
2006-07
1st tax rate
2010-11
2014-15
2nd tax rate
2018-19
2022-23
3rd tax rate
Note: Based on Budget 2014-15 parameters.
6
Commonwealth-State VFI
250
$billion
$billion
250
Public order and safety
200
200
Transport and
communications
VFI
150
Payments to
the States
$101.1 billion
Education
150
Royalties
100
Other revenue
Health
100
Sales of Goods and Services
50
50
Other expenses
Own-source tax revenue
0
0
State Expenses by function
Note: Based on the Commonwealth, State and Territory 2014-15 Budgets.
State own-source revenue