The Government/Democrats' package of changes in indirect taxes

Peter B Dixon, Maureen T Rimmer

    Research output: Contribution to journalArticleResearchpeer-review

    3 Citations (Scopus)

    Abstract

    Australia is faced with a comprehensive package of changes to its indirect tax system, including the introduction of a GST. The Government’s only quantitative analysis in formulating the package employed PRISMOD, an archaic input‐output price model. PRISMOD sheds dim light on a very limited range of policy‐relevant variables. This article explains how PRISMOD works; this is of continuing relevance because PRISMOD results are a benchmark in negotiations concerning the price effects of the tax package. Then an assessment of the package is made using MONASH, a comprehensive dynamic general equilibrium model. Overall, the conclusions are negative: the package is welfare‐reducing and unnecessary.
    Original languageEnglish
    Pages (from-to)147-158
    Number of pages12
    JournalAustralian Journal of Agricultural and Resource Economics
    Volume44
    Issue number1
    DOIs
    Publication statusPublished - Mar 2000

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