Economics and financing

Cover of Implications for the Road Transport Sector of Potential Tax Reform
Implications for the Road Transport Sector of Potential Tax Reform
  • Publication no: AP-135-99
  • ISBN: 0 85588 516 5
  • Published: 1 January 1999

The Government's plans for modernisation of the taxation system within Australia have fuelled public debate on the need and shape of this reform. A broad based consumption tax, a GST (Goods and Services Tax) has been proposed. The Government's tax reform package involves a range of changes in the taxation of goods and services and in the nature of social security and the level of income tax paid by individuals. These developments naturally give rise to the question of what effect any changes in the taxation regime will have on transport. Austroads has a particular interest in the effect on the road transport sector as key aspects of the tax reform proposal are likely to have a direct bearing on the demand for and supply of roads. Amidst the tax reform debate there has also been increasing public discussion about the relative treatment by governments of the various transport modes, especially road and rail. A well developed Computable General Equilibrium (CGE) model has been used to simulate potential tax reform options of the effects on travel demand and the level of externalities generated in the road transport sector.