Danielle Wood backs tax indexation but flags political challenge
The incoming Productivity Commission chair and current Grattan Institute chief executive thinks indexing income tax rates makes sense. But politically it’s a lot murkier.
Incoming Productivity Commission chair and current Grattan Institute chief executive Danielle Wood is known for her forthright views on the need for more childcare subsidies and for women to receive superannuation contributions when on maternity leave.
But she also believes in lower income taxes. Or at least that the scourge of bracket creep should be dealt with as part of a more serious reform of the tax system.
“Without indexation, bracket creep is a tax increase by stealth,” Wood says in a phone call when asked about the issue.“We know that [bracket creep] disproportionately hits middle income earners. From a pure economics perspective, [indexing] makes sense."
Wood spoke to Capital Brief in her capacity as chief executive of the Grattan Institute. However, her comments now will face additional scrutiny due to her recent appointment as the next chair of the Productivity Commission by Federal Treasurer Jim Chalmers. She will take over from Michael Brennan in November.
