Demographic influences on risk perceptions : 074100 (E60, E43) Savage I., Northwestern University, Illinois, Risk Analysis, Vol. 13, nr. 4, 1993, pp. 413–420
- Book ID
- 104299587
- Publisher
- Elsevier Science
- Year
- 1996
- Tongue
- English
- Weight
- 243 KB
- Volume
- 17
- Category
- Article
- ISSN
- 0167-6687
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✦ Synopsis
This paper has highlighted the complexity of the current structure of superannuation taxation in Australia. The difficulty is exacerbated by the way in which the tax structure interacts with the means-tested age pension. The complicated nature of the system makes it very difficult not only for individuals in their retirement planning, but also for policy makers in attempting to evaluate the redistributive and other implications of the tax structure. Two options for reforming the tax structure were proposed, involving different degrees of simplification. The implications of the proposed reforms for the distribution of lifetime income of a cohort of male employees were examined using a variety of inequality and tax progressivity measures. The study used the LITES simulation model, allowing for a variety of alternative-decisions to be made by individuals at retirement. It was found that the proposed simplifications have relatively minor effects, when compared with the present cumbersome system, on the redistributive impact of the tax structure in a life cycle framework. Indeed, the progressivity of the current system is substantially more sensitive to the decisions made by individuals at retirement regarding the investment of their accumulated savings and superannuation amounts. In this respect, it is also less robust than the alternative options.