The CIS’s Peter Saunders in The Australian in 2004 urging policymakersÂ to cutÂ taxes, because our top rate is higher than in other countries:
The tax on higher-income earners is vicious. It is outrageous that people earning $62,000 per year are paying the top rate of tax.
The top tax bracket was worth 15 times average earnings in 1960; nine times average earnings in 1970; three times average earnings in 1980; but is just 1.3 times average earnings today. UK workers do not pay the top tax rate until they earn $73,000. In France it is $77,000; in Germany $85,000; in Canada $110,000. The Japanese top rate starts at $210,000. In the US it is $395,000.
Not only does our top rate cut in too low – the rate itself (48.5 per cent including the Medicare levy) is much too high. In Britain it is only 40 per cent; in Germany it is 45 per cent (and coming down).
Peter Saunders in The AustralianÂ today urging policymakersÂ to cutÂ taxes, and arguing that cross-country comparisons are irrelevant:
The Treasurer maintains we are a low-tax country. He points to his recent report comparing Australia’s tax burden with that of other developed countries. It showed that overall our Government soaks up about the average amount of tax for all western governments, although Japan and the US manage on significantly less.
But the question to ask is not how our Government’s record compares with European spendthrifts such as Sweden or Belgium.