AUSVOTES ECONOMIC FACTS #9: Australia keeping tax down

By Stephen Koukoulas | 22 April 2025, 10:00am | comments |

The economy is a dominant issue in the Election. From now until polling day, Independent Australia will outline some key facts on the economy that put the kybosh on many of the myths, lies and distortions being peddled in the election campaign.

This is the ninth in a series of short articles by leading economist Stephen Koukoulas, which will be published daily up until the Federal Election on Saturday 3 May 2025.

FACT NINE: AUSTRALIA IS A LOW-TAXING COUNTRY

Do you think Australia is a high-taxing country?

If you answered “Yes”, you are wrong.

According to research from Greg Jericho, chief economist at The Australia Institute, Australia is a low-taxed country and indeed, it is one of the lowest-taxed countries in the OECD.

This flies in the face of unsourced claims from Shadow Treasurer Angus Taylor that:

“This is the biggest spending, biggest taxing government in Australian history.”

Jericho uses and cites facts from the OECD, which estimated total government tax revenue as a percentage of GDP across all OECD countries.

Australia’s tax to GDP ratio is just under 30 per cent of GDP, some five percentage points below the OECD average. As Jericho points out, if Australia’s tax to GDP were to rise to that average, it would mean an extra $138 billion in tax being paid by Australians per annum.

If Australia were to hike its taxes to the OECD average, the $138 billion accounts for over $12,000 per household per annum.

The facts aren't taxing — remember them in the lead-up to 3 May.

Other facts in this series:

Stephen Koukoulas is one of Australia’s most respected economists, a past chief economist of Citibank and senior economic advisor to an Australian Prime Minister. You can follow Stephen on Twitter/X @TheKouk.