Statement 5: Revenue
This appendix contains an overview of the cost of tax expenditures provided to taxpayers through the tax system.
Tax expenditures provide a benefit to a specified activity or class of taxpayer. They can be delivered as a tax exemption, tax deduction, tax offset, concessional tax rate or deferral of a tax liability. The Government can use tax expenditures to allocate resources to different activities or taxpayers in much the same way that it can use direct expenditure programmes.
The data reported in this appendix includes tax expenditures related to GST. The data does not include the impact on tax expenditures of decisions in this Budget, or the 2009 UEFO.
Care needs to be taken when analysing tax expenditure data: see Section 2.2 of the 2008 Tax Expenditures Statements for a detailed discussion.
Table F1 contains estimates of total tax expenditures for the period 2005‑06 to 2012‑13.
Table F1: Total measured tax expenditures
| Year | Superannuation $m |
Other tax expenditures $m |
Total $m |
Tax expenditure as a proportion of GDP (%) |
|---|---|---|---|---|
| 2005‑06 (est) | 22,885 | 36,154 | 59,039 | 6.1 |
| 2006‑07 (est) | 30,379 | 40,548 | 70,927 | 6.8 |
| 2007‑08 (est) | 29,230 | 44,466 | 73,696 | 6.5 |
| 2008‑09 (proj) | 24,593 | 42,848 | 67,441 | 5.6 |
| 2009‑10 (proj) | 24,943 | 43,313 | 68,256 | 5.8 |
| 2010‑11 (proj) | 26,922 | 45,971 | 72,893 | 6.0 |
| 2011‑12 (proj) | 29,456 | 49,792 | 79,248 | 6.1 |
| 2012‑13 (proj) | 30,751 | 52,836 | 83,587 | 6.0 |
Table F1 shows that measured tax expenditures as a proportion of GDP are projected to fall from 6.5 per cent in 2007‑08 to 5.6 per cent in 2008‑09, mainly as a result of the impact of personal income tax cuts.
Table F2 shows estimates of large measured tax expenditures for 2008‑09.
Table F2: Large measured tax expenditures in 2008‑09
| Tax expenditure | Estimate $m | ||
|---|---|---|---|
| Large positive tax expenditures | |||
| Superannuation — concessional taxation of superannuation entity earnings | 12,150 | ||
| Superannuation — concessional taxation of employer contributions | 10,150 | ||
| Capital gains tax discount for individuals and trusts | 8,640 | ||
| GST — Food — uncooked, not prepared, not for consumption on premises of sale and some beverages | 5,200 | ||
| Exemption of Family Tax Benefit, Parts A and B, including expense equivalent | 2,490 | ||
| GST — Health; medical and health services | 2,300 | ||
| GST — Education | 2,250 | ||
| Exemption from interest withholding tax on widely held debentures | 1,910 | ||
| Application of statutory formula to value car benefits | 1,830 | ||
| Concessional taxation of non‑superannuation termination benefits | 1,450 | ||
| Superannuation — deduction and concessional taxation of certain personal contributions | 1,350 | ||
| GST — Financial Supplies; input taxed treatment | 1,270 | ||
| Exemption of 30 per cent private health insurance refund, including expense equivalent | 1,050 | ||
| Exemption from the Medicare levy for residents with a taxable income below a threshold | 1,010 | ||
| Reduced withholding tax under international tax treaties | 900 | ||
| Senior Australians' Tax Offset | 860 | ||
| GST — Imported services | 850 | ||
| Exemption from excise for 'alternative fuels' | 830 | ||
| Income tax exemption for public and municipal authorities and other local governing bodies | 830 | ||
| Deduction for gifts to approved donees | 800 | ||
| Concessional rate of excise levied on aviation gasoline and aviation turbine fuel | 710 | ||
| Capped exemption for public benevolent institutions (excluding public and not‑for‑profit hospitals) | 670 | ||
| Exemption of certain income support benefits, pensions or allowances | 610 | ||
| Tax offsets for dependent spouse, child‑housekeeper and housekeeper who cares for a prescribed dependant | 600 | ||
| Large negative tax expenditures | |||
| Customs duty | ‑3,730 | ||
| Higher rate of excise levied on cigarettes with less than 0.8 grams of tobacco | ‑1,244 | ||
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