Tax and Transfer Policy Institute

31/08/2026

Population ageing is the defining demographic fact of advanced economies. Across the OECD, the old-age dependency ratio reached approximately 31 per cent in 2023 and is projected to approach 52 per cent by 2060, while the share of people aged 65 and over is expected to rise from around 20 per cent to 27.4 per cent by 2050, even as total population declines slightly. As a result, governments face rising pension and health spending while the labour force and tax base that fund these are shrinking.

Ageing is widely expected to weigh on economic growth. The more policy-relevant question is whether the growth effects of ageing are predetermined, or whether their size depends on conditions governments can influence. Our recent piece in Austaxpolicy examines two such factors across 37 OECD countries: fiscal sustainability and labour force participation.

We find that ageing does reduce growth, but the size of that reduction is smaller where fiscal positions are stronger, and labour force participation is higher.

The important policy implication is that the growth effects of ageing are not predetermined. Two factors that governments can influence — fiscal health and the share of people participating in the labour force — materially affect the size of that drag.

Ageing may be unavoidable. How much growth it costs is not.

Read more on Austaxpolicy:

Ageing is widely expected to weigh on economic growth. The question is whether the growth effects of ageing are predetermined, or whether their size depends on conditions governments can influence. Our paper examines two such factors: fiscal sustainability and labour force participation.

24/08/2026

As Canada’s population ages and access to facility-based long-term care remains constrained, more seniors are relying on care at home.

But Canada’s existing tax credits for home care - the Home Accessibility Tax Credit and medical expense tax credit for attendant care - do not adequately support those facing the greatest financial pressure. Non-refundable credits can provide little or no benefit to low-income seniors, while senior renters may face barriers to accessing support for home accessibility modifications.

In his article, Raymond Li explores how redesigning home care tax credits - including greater refundability, improved support for renters and recognition of informal caregivers - could help ensure policy reaches those who need it most.

How Canada can redesign tax credits to better support low-income seniors, and caregivers, and senior renters.

11/08/2026

When do Australians expect to retire - and when would they actually prefer to?

In their new Austaxpolicy article, Inga Kristoffersen and Paul Gerrans review two decades of Australian retirement income policy and examine changes in workers’ expected and preferred retirement ages between 2003 and 2023.

Drawing on HILDA Survey data, they find that both expected and preferred retirement ages have increased across all age groups, though the change is most pronounced among younger respondents.

The research also identifies a narrow but persistent gender gap in expected retirement age, with men expecting to retire around 1.2 years later than women on average. Meanwhile, between 5% and 10% of workers are unable to nominate a specific expected retirement age.

These findings raise important questions for retirement policy. Changes to the Age Pension eligibility age, and superannuation rules can influence retirement expectations, but individuals’ responses also depend on their understanding of the system, engagement with retirement planning and ability to respond to changing incentives.

As Australia faces increasing fiscal pressures associated with population ageing, understanding how workers form and revise their retirement expectations will be increasingly important.

Read the full article: https://www.austaxpolicy.com/great-retirement-expectations-a-review-of-retirement-income-policy-and-changes-to-expected-and-preferred-retirement-age-of-australian-workers/

Changes to expected and preferred retirement ages of Australian Workers

27/07/2026

Fifty years after the release of the Asprey Taxation Review, the debate over how we tax individuals and families remains highly relevant.

In this article, Helen Hodgson examines Asprey’s defence of the individual tax unit through a gender lens, exploring how tax design affects women’s economic independence, workforce participation and equality.

Read the full article here 👇

Explore why individual taxation remains more equitable than income splitting in Australia, and how tax policy affects gender equality, work and economic independence.

20/07/2026

Australia's tax-funded healthcare system must balance two core objectives: ensuring healthcare is accessible to all while using public resources efficiently. Telehealth has been promoted as a way to achieve both, but has the rapid expansion of remote GP consultations come at the expense of quality?

In this article, Daniel Avdic, Johannes S. Kunz, Susan J. Méndez and Maria Wiśniewska examine the impact of telehealth on prescribing quality in Australian primary care. Read more here 👇

New research finds telehealth improves access and efficiency in Australia's tax-funded health system without compromising the quality of antibiotic prescribing.

19/06/2026

Did decolonization strengthen fiscal capacity in Africa? Dhammika Dharmapala and Marvin Suesse find that post-independence governments in Africa substantially increased revenue-raising capacity, with state legitimacy helping explain the change. Read more here 👇

Explore how decolonization increased fiscal capacity in Africa, with state legitimacy and tax morale driving post-independence state-building.

16/06/2026

Digital services taxes are often debated through an international tax lens, but they can also be understood as trade policy tools. Victoria Plekhanova and Chris Noonan's article explores how DSTs may operate as tariffs, anti-subsidy measures, or countermeasures to the under-taxation of large digital platforms, offering a fresh way to think about fairness, competition and market jurisdictions’ taxing rights. Read more here 👇

Explore how digital services taxes can be understood through trade policy—as tariffs or anti-subsidy measures—reshaping the global tax debate.

12/06/2026

Australia’s income tax system has a long-standing quirk: its core rules are split across two separate laws: the 1936 and 1997 Acts.

But does this "split tax code" actually make life harder for tax professionals? And should policymakers revive the old project to combine them into one unified law?

In our latest blog post, Sally-Ann Joseph, Helen Hodgson, and Chris Evans share findings from a survey of Australian tax practitioners. They dive into the hidden "psychological costs" of interpreting fragmented legislation, including the stress, anxiety, and frustration that go beyond just billable hours.

Catch the full article and insights here: https://www.austaxpolicy.com/unfinished-business-assessing-and-addressing-the-burden-of-the-split-tax-code-in-australia/

02/06/2026

Despite major housing announcements in the 2026 Budget, rental stress remains a growing challenge for many Australians on low incomes.

In this Budget Forum article, Peter Whiteford examines the latest data on Commonwealth Rent Assistance (CRA), showing that despite earlier improvements, rental stress has returned to 2022 levels. The article argues that increasing CRA remains one of the most direct ways to reduce housing stress for low-income renters. Read the full analysis here 👇

Rental stress is rising for low-income Australians. Increasing Commonwealth Rent Assistance could help ease housing pressures and improve affordability.

01/06/2026

The 2026–27 Federal Budget has unsettled estate planning because it places two structural tax reforms beside a familiar succession-planning vehicle: the discretionary testamentary trust.

📌 What's proposed?

From 1 July 2027, the first proposed measure would replace the 50 per cent CGT discount for individuals, trusts and partnerships with cost base indexation and a 30 per cent minimum tax on net capital gains.

From 1 July 2028, the second would impose a 30 per cent minimum tax on discretionary trust taxable income, with non-refundable credits for non-corporate beneficiaries and specified exclusions.

These are proposed reforms, not enacted law. But Budget announcements can still affect present planning.

📌 Why does this matter beyond tax?

Testamentary trusts serve purposes that go well beyond income splitting. They protect vulnerable beneficiaries, preserve family assets, manage blended families, defer control and support business succession planning. A regime that treats discretionary power as the problem may therefore compromise important non-tax functions - continuity of family businesses, control of closely held assets and intergenerational governance - unless exclusions and credits are carefully designed.

📌 The hard questions are legislative.

Will grandfathering protect wills already signed but not yet activated, or only assets held by trusts on Budget night?

How will substituted assets, reinvested proceeds and borrowed funds be traced?

How will fixed, discretionary and hybrid testamentary trusts be classified?

Until draft legislation answers those questions, careful analysis requires a clear distinction between enacted law, announced policy and political characterisation.

The real test of the reform will be whether it can curb tax-driven income splitting without collateral damage to the legitimate protective and succession-planning purposes for which testamentary trusts are often used.

Sylvia Villios sets out the full analysis 👇

https://www.austaxpolicy.com/testamentary-trusts-after-the-2026-27-budget-estate-planning-tax-reform-and-the-death-tax-debate/

The 2026–27 Federal Budget proposes major changes to CGT and discretionary trust taxation. Understand what it means for your estate planning and existing wills.