Tax and Transfer Policy Institute

Did decolonization strengthen fiscal capacity in Africa? Dhammika Dharmapala and Marvin Suesse find that post-independence governments in Africa substantially increased revenue-raising capacity, with state legitimacy helping explain the change. Read more here 👇

Decolonization, Legitimacy and Fiscal Capacity: Event Study Evidence from Africa - Austaxpolicy: The Tax and Transfer Policy Blog Explore how decolonization increased fiscal capacity in Africa, with state legitimacy and tax morale driving post-independence state-building.

Digital services taxes are often debated through an international tax lens, but they can also be understood as trade policy tools. Victoria Plekhanova and Chris Noonan's article explores how DSTs may operate as tariffs, anti-subsidy measures, or countermeasures to the under-taxation of large digital platforms, offering a fresh way to think about fairness, competition and market jurisdictions’ taxing rights. Read more here 👇

Digital Services Taxes, Tariffs and Subsidies: A New Perspective to an Old Debate - Austaxpolicy: The Tax and Transfer Policy Blog Explore how digital services taxes can be understood through trade policy—as tariffs or anti-subsidy measures—reshaping the global tax debate.

Australia’s income tax system has a long-standing quirk: its core rules are split across two separate laws: the 1936 and 1997 Acts.

But does this "split tax code" actually make life harder for tax professionals? And should policymakers revive the old project to combine them into one unified law?

In our latest blog post, Sally-Ann Joseph, Helen Hodgson, and Chris Evans share findings from a survey of Australian tax practitioners. They dive into the hidden "psychological costs" of interpreting fragmented legislation, including the stress, anxiety, and frustration that go beyond just billable hours.

Catch the full article and insights here: https://www.austaxpolicy.com/unfinished-business-assessing-and-addressing-the-burden-of-the-split-tax-code-in-australia/

Despite major housing announcements in the 2026 Budget, rental stress remains a growing challenge for many Australians on low incomes.

In this Budget Forum article, Peter Whiteford examines the latest data on Commonwealth Rent Assistance (CRA), showing that despite earlier improvements, rental stress has returned to 2022 levels. The article argues that increasing CRA remains one of the most direct ways to reduce housing stress for low-income renters. Read the full analysis here 👇

Budget Forum 2026: To reduce housing stress, rent assistance needs to be increased - Austaxpolicy: The Tax and Transfer Policy Blog Rental stress is rising for low-income Australians. Increasing Commonwealth Rent Assistance could help ease housing pressures and improve affordability.

The 2026–27 Federal Budget has unsettled estate planning because it places two structural tax reforms beside a familiar succession-planning vehicle: the discretionary testamentary trust.

📌 What's proposed?

From 1 July 2027, the first proposed measure would replace the 50 per cent CGT discount for individuals, trusts and partnerships with cost base indexation and a 30 per cent minimum tax on net capital gains.

From 1 July 2028, the second would impose a 30 per cent minimum tax on discretionary trust taxable income, with non-refundable credits for non-corporate beneficiaries and specified exclusions.

These are proposed reforms, not enacted law. But Budget announcements can still affect present planning.

📌 Why does this matter beyond tax?

Testamentary trusts serve purposes that go well beyond income splitting. They protect vulnerable beneficiaries, preserve family assets, manage blended families, defer control and support business succession planning. A regime that treats discretionary power as the problem may therefore compromise important non-tax functions - continuity of family businesses, control of closely held assets and intergenerational governance - unless exclusions and credits are carefully designed.

📌 The hard questions are legislative.

Will grandfathering protect wills already signed but not yet activated, or only assets held by trusts on Budget night?

How will substituted assets, reinvested proceeds and borrowed funds be traced?

How will fixed, discretionary and hybrid testamentary trusts be classified?

Until draft legislation answers those questions, careful analysis requires a clear distinction between enacted law, announced policy and political characterisation.

The real test of the reform will be whether it can curb tax-driven income splitting without collateral damage to the legitimate protective and succession-planning purposes for which testamentary trusts are often used.

Sylvia Villios sets out the full analysis 👇

https://www.austaxpolicy.com/testamentary-trusts-after-the-2026-27-budget-estate-planning-tax-reform-and-the-death-tax-debate/

Testamentary Trusts after the 2026-27 Budget: Estate Planning, Tax Reform and the “Death Tax” Debate - Austaxpolicy: The Tax and Transfer Policy Blog The 2026–27 Federal Budget proposes major changes to CGT and discretionary trust taxation. Understand what it means for your estate planning and existing wills.

The Federal Budget makes important steps toward intergenerational equity, but young people expect more. Asha Clementi and Mehvish Mehboob from The Persephone Network analyse the Government’s commitments to intergenerational equity, housing reform, women’s leadership, economic justice, and freedom from violence.

Read what they have to say here 👇

Budget Forum 2026: The Persephone Network Budget Response - Austaxpolicy: The Tax and Transfer Policy Blog Young women from The Persephone Network respond to the Federal Budget, examining intergenerational equity, housing, gender equality and safety.

How can structural tax reform improve both the efficiency and equity of the housing system?

Writing for Austaxpolicy, Gavin Wood and Susan Smith outline a model to replace transaction-linked property taxes with a recurrent, two-tier Land Value Tax. The authors argue that traditional mechanisms like stamp duty reduce labour and residential mobility, while capital gains exemptions can create market distortions.

The proposed "Feebate" system design seeks to establish a more level playing field between first-home buyers and secondary property investors. Additionally, the model evaluates how the resulting revenue could be structured to fund social housing infrastructure and provide a regular dividend to residents.

Read the complete policy proposal here: https://www.austaxpolicy.com/budget-forum-2026-feebates-tax-reform-to-raise-funds-for-a-fairer-and-more-efficient-housing-future/

Budget Forum 2026: Feebates: Tax Reform to Raise Funds for a Fairer and More Efficient Housing Future - Austaxpolicy: The Tax and Transfer Policy Blog Gavin A Wood, Emeritus Professor, Centre for Urban Research, RMIT University Susan J Smith, Hon Emerita University Professor of Social and Economic Geography, and Life… Read More ›

Australia’s proposed $1000 instant tax deduction is aimed at simplifying tax time, but is it that simple in practice? Read what Elizabeth Morton and Lisa Greig have to say about the new measure here👇

Budget Forum 2026: What’s hiding within the proposed $1000 instant tax deduction? - Austaxpolicy: The Tax and Transfer Policy Blog Introduction The proposed $1000 “instant” tax deduction seems to be a win for many Australian taxpayers as they will get a deduction without spending a… Read More ›

Does halving the fuel tax actually help those who need it most, or does it create bigger economic potholes down the road?

In our latest Budget Forum piece, John Freebairn takes a critical look at the temporary cut to the fuel excise.

As electric vehicles increasingly share our highways, what should a sustainable, long-term road funding solution look like? ⚡🛣️

Explore the full breakdown on the Austaxpolicy blog:
https://www.austaxpolicy.com/budget-forum-2026-running-on-empty-the-hidden-costs-of-halving-the-fuel-tax/

“It’s Not Fair: Why the Capital Gains Tax Discount needs to go”

The capital gains tax discount was introduced more than 25 years ago by then Treasurer Peter Costello to encourage investment, compensate for inflation, and improve international competitiveness.

However, research over the past quarter century shows the discount has produced significant inequities, inefficiencies and revenue losses, while failing to meet the principles of a well-designed tax system.

To kick off Austaxpolicy’s , Chris Evans explains why the discount is unfair, inefficient and too costly, offending the principles of vertical, horizontal and intergenerational equity that underpin Australia’s tax system.

Read more 👇

Budget Forum 2026: It’s Not Fair: Why the Capital Gains Tax Discount Needs To Go - Austaxpolicy: The Tax and Transfer Policy Blog Why Australia’s capital gains tax discount should be reduced or abolished: explore its impact on housing affordability, inequality, efficiency, and the federal budget, plus practical reform options ahead of the May Budget.