12th May 2006 
 
Australia’s top marginal tax rate of 47% should be aligned with the corporate tax rate of 30% according to a survey of local business people conducted by the Institute of Chartered Accountants at its annual Business Forum in Adelaide.  
 
The survey revealed that 73% of respondents believe that the two rates should be aligned and nearly 70% also thought tax returns should be made optional for taxpayers who have very simple tax affairs.  
 
Mark Jones, General Manager at the Institute of Chartered Accountants in Adelaide, said he was not surprised by the results.  
 
“The difference between the tax rates causes major distributive inefficiencies that the taxation legislation has constantly attempted to rectify. However, none have completely rectified this inefficiency,” Mr Jones said.  
 
He also said optional tax returns should be encouraged in Australia.  
 
“The majority of taxpayers have very simple tax affairs - they derive only salary and wages and / or interest income and have only minimal deductions - but they are still required to lodge annual tax returns.  
 
“We consider that the effort undertaken to complete these returns is not in proportion to the revenue collected. Our proposed solution is the introduction of optional tax returns for taxpayers whose income is subject to withholding at its source”.  
 
The survey was conducted during a presentation given this week by International Economist Professor Neville Norman.  
 
Professor Norman said that this year’s budget provided adjustments, rather than reform, which the Treasurer had to give to offset the fiscal drag that has taken place over recent years.  
 
Addressing over 100 Adelaide business people, he said that if the Government had not made the adjustments, Australians would be paying significantly more taxes in real terms.  
 
“The Australian public would be seriously suffering from the affect of fiscal drag had Mr Costello not returned what had been taken by the Government over recent years. These adjustments will merely stop us from hurting unnecessarily,” Professor Norman said.