Taxation in Australia

There are many forms of taxation in Australia. Individuals and companies in Australia may be required to pay taxes or charges to all levels of government: local, state, and federal governments. Taxes are collected to pay for public services and transfer payments (redistribution of economic wealth).

Income taxes are the most significant form of taxation in Australia, and collected by the federal government through the Australian Taxation Office. Australian GST revenue is collected by the Federal government, and then paid to the states under a distribution formula determined by the Commonwealth Grants Commission.

Australia maintains a relatively low tax burden in comparison with other wealthy, developed nations, at 25.6% of GDP in 2013.

When the first Governor, Governor Phillip, arrived in New South Wales in 1788, he had a Royal Instruction that gave him power to impose taxation if the colony needed it. The first taxes in Australia were raised to help pay for the completion of Sydney's first gaol and provide for the orphans of the colony. Import duties were put on spirits, wine and beer and later on luxury goods.

After 1824 the Government of New South Wales raised extra revenue from customs and excise duties. These were the most important sources of revenue for the colony throughout the 19th century. Taxes were raised on spirits, beer, tobacco, cigars and cigarettes. These taxes would vary between each of the Australian colonies, and this state of affairs remained in place after the colonies achieved statehood - indeed, it still persists to this day.

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