Appendix A: Data sources and details
This report primarily uses World Bank, Australian Bureau of Statistics National Accounts, TaxStats and internal ATO data. The data released by the World Bank was chosen because it provides the most comprehensive coverage across countries, including the low-tax jurisdictions and the key Asian economies. It has been cross-checked against our operational intelligence. Figures in this report are represented in nominal Australian dollar terms and are compared with GDP to reflect relative trends over time, particularly for cross-country comparisons. Measures of corporate profit, such as gross operating surplus, have not been used because some countries do not report this measure. Results may differ, depending on the data extraction date. The impact of these differences is unlikely to be material.
Figures from 2012 were used because they reflected the final year of data available at the time of writing. Ten-year time series data is from 2003 to 2012, while data associated with international related party dealings and international trade in services and royalties is presented from 2005 to 2012, due to data limitations in previous years.
Depending on the data sources figures are presented in income tax years (TY), financial years (FY) or calendar years (CY). In this report, the reporting period is specified in front of the year for each observation – for example, financial year 2012 is represented as FY2012 9. Australia reports national accounts (GDP, GVA etc) on a FY basis, while the rest of the world mostly reports on a CY basis. As a result, FY figures are sometimes compared to CY figures from other countries. These differences do not affect the overarching trends, due to the relative length of the time series. TY figures are required, due to companies with substituted account periods (SAP) that differ from the financial year 10.
Appendix B: Imputation system
Through Australia’s dividend imputation system, approximately $18 billion of company income tax is passed on to the benefit of shareholders. This portion of company tax is, in effect, a pre-payment of individual/superannuation fund tax. For this analysis, franking credits have been separated out to make Australia’s corporate tax base more comparable to other countries without franking regimes.