Modelling Reform Packages for Property, Corporate and Household Taxes

At the August 2025 Economic Reform Roundtable, the Federal Treasurer committed to ‘a better tax system’.  In that spirit, this paper models reform packages for Australian property, corporate and household taxes to increase consumer welfare by shifting towards more efficient taxes.  The design of each package is guided by recently-updated estimates for the efficiency of each tax.  Each package is budget neutral and is modelled using the CGETAX model.  The three packages generate large permanent gains.  Annual consumer welfare is up by $43 billion and real GDP by nearly 6 per cent.  Achieving those benefits requires collecting $91 billion in tax in a way that is less harmful for welfare.