An open letter organized by The Australia Institute has urged the Australian Government not to join a race to the bottom on tax and to instead focus on tackling tax avoidance and tax loopholes.
Signed by more than 30 economists and public figures, the letter argues that "in order to fund the services and infrastructure that Australia needs, we need more tax – not less."
It called upon political leaders "to reject a tax cuts race to the bottom, and instead focus on tackling tax avoidance, closing tax loopholes, and unfair tax concessions in order to build a stronger revenue base for the nation."
Alongside the letter, The Australia Institute has published research which it says shows that Australia "is a low-taxing country." The Institute analyzed OECD data and reported that the Australian tax system fares well compared with the competitiveness of other developed countries.
The Institute said that Australia's total tax-to-GDP ratio makes it the eighth-lowest taxing member among the OECD's 35 member jurisdictions. At 28.2 percent of GDP, the Australian tax burden is below the OECD average of 34.3 percent.
According to the Institute, "to reach the OECD average, Australia would need to raise an extra 6.1 percent of GDP as tax revenue." It said that "6.1 percent of Australia's AUD1.8 trillion GDP in 2017 is approximately AUD110bn" in extra revenue.