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Tax complexity in Australia: A survey-based comparison to the OECD average

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  • Hoppe, Thomas

Abstract

This article comprehensively reviews Australia's corporate income tax complexity as faced by multinational corporations (MNCs) and compares it to the average of the remaining OECD countries. Building on unique survey data, I find that the Australian tax code is considerably more complex than the OECD average, which is mainly due to overly complex anti-avoidance legislation, such as regulations on transfer pricing, general anti-avoidance or controlled foreign corporations (CFC). In contrast, Australia's tax framework, which covers processes and fea-tures such as tax law enactment or tax audits, is close to the OECD average. A more granular analysis yields further interesting insights. For example, excessive details in the tax code and the time between the announcement of a tax law change and its enactment turn out to be serious issues in Australia relative to the remaining OECD countries.

Suggested Citation

  • Hoppe, Thomas, 2020. "Tax complexity in Australia: A survey-based comparison to the OECD average," arqus Discussion Papers in Quantitative Tax Research 251, arqus - Arbeitskreis Quantitative Steuerlehre.
    • Handle: RePEc:zbw:arqudp:251
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    References listed on IDEAS

    as
    1. Simon James & Adrian Sawyer & Tamer Budak (ed.), 2016. "The Complexity of Tax Simplification," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-137-47869-6.
    2. Barkoczy, Stephen, 2016. "Foundations of Taxation Law 2016," OUP Catalogue, Oxford University Press, edition 8, number 9780190304423.
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    4. David Smith & Graham Richardson, 1999. "The readability of Australia’s taxation laws and supplemetary materials: an empirical investigation," Fiscal Studies, Institute for Fiscal Studies, vol. 20(3), pages 321-349, September.
    5. Hoppe, Thomas & Schanz, Deborah & Sturm, Susann & Sureth, Caren, 2019. "Measuring tax complexity across countries: A survey study on MNCs," arqus Discussion Papers in Quantitative Tax Research 245, arqus - Arbeitskreis Quantitative Steuerlehre.
    6. Brushwood, James D. & Johnston, Derek M. & Lusch, Stephen J., 2018. "The effect of tax audit outcomes on the reporting and valuation of unrecognized tax benefits," Advances in accounting, Elsevier, vol. 42(C), pages 1-11.
    7. Binh Tran-Nam & Chris Evans & Richard Krever & Philip Lignier, 2016. "Managing Tax Complexity: The State of Play after Henry," Economic Papers, The Economic Society of Australia, vol. 35(4), pages 347-358, December.
    8. Binh Tran‐Nam & Chris Evans, 2014. "Towards the Development of a Tax System Complexity Index," Fiscal Studies, Institute for Fiscal Studies, vol. 35, pages 341-370, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Tax Complexity; Corporate Income Tax System; Survey; Australia; OECD Countries;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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