Across all levels of government, Australia collects a greater share of tax revenue from personal income than all 37 other OECD countries, bar Denmark. At 42 per cent, our personal income tax share is almost double the OECD average, at 23 per cent. That’s up from 37 per cent in 2007 after years of Howard government tax cuts, and 38 per cent in 2000 after the GST introduction.

The reason is simple: personal income tax is the only tax base we have that grows as a share of the economy over time. And the reason for that is simple too: we have a progressive schedule of fixed nominal income thresholds that therefore fall in real terms over time. So a taxpayer with zero real wage growth will nevertheless pay more in income tax each year.