When an economist's chart matters; sorting through the tax debate
It has become the chart at the centre of Australia's nascent tax debate, writes Jacob Gerber.
At first glance, it looks like a nerdy Treasury official’s wet dream, which is lucky, as the department is responsible for its creation.
A critical part of Treasury’s submission to the tax white paper Re:Think, the chart illustrates the effect on the economy of different types of taxes – also known as the “marginal excess burden” – of differing imposts. It’s based on the simple idea that all taxes are a dead weight on economic growth and jobs, but some are worse than others.
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