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Changes in the Taxation of Superannuation - Macroeconomic and Welfare Effects

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  • John Creedy
  • Ross Guest

Abstract

This paper provides an applied general equilibrium analysis of several alternative taxation regimes applying to superannuation. It is motivated by the decision, announced by the Australian Government in its 2006 Budget, to exempt from tax all superannuation benefits received by recipients over 60 years of age. The analysis focuses on the implications of this and other superannuation tax regimes for intergenerational equity, national living standards, labour supply, saving and social welfare. The method of analysis is simulation of an open economy overlapping generations CGE model, calibrated to Australia.Acknowledgements - The authors wish to thank the Australian Research Council for financial support for this work; and the Productivity Commission for providing data on age-specific government spending.

Suggested Citation

  • John Creedy & Ross Guest, 2007. "Changes in the Taxation of Superannuation - Macroeconomic and Welfare Effects," Department of Economics - Working Papers Series 986, The University of Melbourne.
    • Handle: RePEc:mlb:wpaper:986
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    References listed on IDEAS

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    1. Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, December.
    2. Tracy Foertsch, 2004. "Macroeconomic Impacts of Stylized Tax Cuts in an Intertemporal Computable General Equilibrium Model: Technical Paper 2004-11," Working Papers 15914, Congressional Budget Office.
    3. Productivity Commission, 2005. "Economic Implications of an Ageing Australia," Research Reports, Productivity Commission, Government of Australia, number 16.
    4. Productivity Commission, 2005. "Economic Implications of an Ageing Australia," Labor and Demography 0506001, University Library of Munich, Germany.
    5. Whitehouse, Edward, 1999. "The tax treatment of funded pensions," MPRA Paper 14173, University Library of Munich, Germany.
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    More about this item

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

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