Description

Over the course of the 2008-09 financial year the Australian Government took a series of significant fiscal policy decisions which were designed to act as an economic stimulus. This paper asks the following simple hypothetical question: if those policy changes had instead been implemented as a one-off tax cut, how large would that tax cut have been? To answer this, we need to answer the following two questions. First, how large were the government's fiscal policy decisions last financial year, relative to the baseline of no policy change? Second, what is the equivalent size of the tax cut that this would have "bought"?