Freebairn Lecture 2017

Professor Bob Gregory will explore federal budget outcomes, primarily tax revenue shortfalls over the last decade and a half, to explain why tax revenue forecast errors are so large, why budget deficits have become so persistent and why the implicit tax policy of government is leading to an inexorable and significant rise in personal income tax rates. This discussion is linked to economic misjudgements of Treasurers and the unanticipated structural changes that are occurring in the Australian economy. The lecture will also contain asides on how Treasurers too often divert discussion away from major longer run budget issues and how political spin, focused on the short run, has made the development of good fiscal policy difficult and weakened governments’ ability to understand the tax implications of the large structural changes occurring in the Australian economy.