The GFS framework reflects taxation revenue collected by each level of government. The purpose of this appendix is to consider an alternative presentation of revenue which takes into account the level of government at which revenue is used rather than simply collected. The analysis considers the flows, by way of current grants, that occur between the levels of government in Australia, and the impact that this has on revenue at each of these levels. Also considered is the effect of direct and indirect transfers to households on total revenue. To aid in the understanding of these flows, the following analytical measures of revenue have been derived. Users should note that these measures are not themselves part of the GFS framework.
ADJUSTED TAXATION REVENUE
Adjusted taxation revenue is equal to GFS taxation revenue collected by each level of government, plus current grants received from higher levels of government, less current grants paid to lower levels of government. This measure is designed to give a clearer indication of the levels of government at which taxation revenue is actually used or spent. The source for a significant amount of the current grants distributed between levels of government is taxation revenue, such as the GST. However, some of the revenue distributed may have come from a source other than taxation. Further, it should be noted that some of the current grants transferred from Commonwealth Government to the state and local governments are Specific Purpose Payments (SPPs). Unlike the GST-related grants, these payments are 'tied' to specific policy areas as agreed between the two levels of government. Similar arrangements exist between state and local government. SPPs for current purposes are included with other current grants in deriving adjusted taxation revenue.
ADJUSTED TOTAL REVENUE
Adjusted total revenue is equal to adjusted taxation revenue plus all other non-taxation sources of revenue. Non-taxation revenue includes revenue from sales of goods and services, property income (interest, dividends, income tax equivalents, land rents and royalties), fines, capital transfers, and current transfers other than grants. Current grants are excluded from non-taxation revenue because these have already been taken into account in deriving adjusted taxation revenue.
ADJUSTED TOTAL REVENUE LESS TRANSFERS TO HOUSEHOLDS
An important role of government is the redistribution of income, by way of direct and indirect 'benefits', to individual households. These transfers can be deducted from adjusted total revenue to derive adjusted total revenue less transfers to households. Direct benefits are regular cash payments made to households by government without any requirement to provide goods and services in return (e.g. welfare payments). Indirect benefits are non-cash benefits and services provided by government to individual households (e.g. concessions for transport and utilities, medical and pharmaceutical benefits and natural disaster relief).
The three derived measures explained above are illustrated in the following diagram:
ADJUSTED TAXATION REVENUE
Table 1 shows the derivation of adjusted taxation revenue, for all three levels of government and the multi-jurisdictional general government sector in Australia.
TABLE 1. ADJUSTED TAXATION REVENUE, By Level of Government, and as % of GDP(a)
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
$m
$m
$m
$m
$m
$m
COMMONWEALTH
1. Taxation revenue collected(b)
317 986
338 625
352 338
356 141
370 392
389 797
As % of GDP
21.2
22.1
22.1
22.0
22.3
22.2
As % of total tax revenue
81.4
81.5
81.0
80.1
79.6
79.8
2. Current grants to state government(c)
83 240
84 193
88 270
95 363
99 364
105 620
3. Current grants to local government
35
32
66
-
6
2
4. Current grants to multi-jurisdictional sector(d)
8 617
9 108
9 634
9 985
10 319
10 164
5. Adjusted taxation revenue =1-2-3-4(e)
226 095
245 292
254 367
250 793
260 704
274 012
As % of GDP
15.1
16.0
15.9
15.5
15.7
15.6
As % of total tax revenue
57.9
59.0
58.5
56.4
56.0
56.1
STATE
1. Taxation revenue collected(b)
60 005
63 722
68 498
73 774
79 097
82 255
As % of GDP
4.0
4.2
4.3
4.6
4.8
4.7
As % of total tax revenue
15.3
15.3
15.8
16.6
17.0
16.8
2. Current grants from Commonwealth government
83 240
84 193
88 270
95 363
99 364
105 620
3. Current grants to local government
4 220
3 737
2 721
4 311
3 513
4 843
4. Current grants to multi-jurisdictional sector(d)
495
537
460
408
427
447
5. Adjusted taxation revenue =1+2-3-4(e)
138 531
143 641
153 587
164 418
174 520
182 585
As % of GDP
9.3
9.4
9.6
10.1
10.5
10.4
As % of total tax revenue
35.5
34.6
35.3
37.0
37.5
37.4
LOCAL
1. Taxation revenue collected(b)
13 202
14 027
14 870
15 779
16 620
17 418
As % of GDP
0.9
0.9
0.9
1.0
1.0
1.0
As % of total tax revenue
3.4
3.4
3.4
3.5
3.6
3.6
2. Current grants from Commonwealth government
35
32
66
-
6
2
3. Current grants from state government
4 220
3 737
2 721
4 311
3 513
4 843
4. Adjusted taxation revenue = 1+2+3(e)
17 456
17 797
17 657
20 091
20 139
22 263
As % of GDP
1.2
1.2
1.1
1.2
1.2
1.3
As % of total tax revenue
4.5
4.3
4.1
4.5
4.3
4.6
MULTI-JURISDICTIONAL
1. Taxation revenue collected(b)
-
-
-
-
-
-
2. Current grants from Commonwealth government
8 617
9 108
9 634
9 985
10 319
10 164
3. Current grants from state government
495
537
460
408
427
447
4. Adjusted taxation revenue = 1+2+3(e)
9 111
9 645
10 095
10 393
10 746
10 611
As % of GDP
0.6
0.6
0.6
0.6
0.6
0.6
As % of total tax revenue
2.3
2.3
2.3
2.3
2.3
2.2
TOTAL
Gross Domestic Product
1 496 800
1 533 882
1 595 776
1 621 404
1 659 604
1 758 130
Total taxation revenue collected
390 470
415 602
434 864
444 833
465 216
488 499
As % of GDP
26.1
27.1
27.3
27.4
28.0
27.8
- nil or rounded to zero (including null cells)
(a) Based on GDP at current prices as published in Australian National Accounts: National Income, Expenditure and Product, December Quarter 2017 (Cat. no. 5206.0), Table 36 Expenditure on Gross Domestic Product (GDP), Chain Volume Measures and Current Prices: Annual.
(b) According to GFSM2001.
(c) Part of the Commonwealth Government grants paid to State Governments are passed on to Local Governments.
(d) The multi-jurisdictional sector contains units where jurisdiction is shared between two or more governments, or where classification of a unit to a jurisdiction is otherwise unclear. The main type of units currently falling into this category are the public universities.
(e) The sum of taxation revenue for all levels of government does not equal the sum of adjusted taxation revenue for all levels of government as a result of consolidation.
ADJUSTED TOTAL REVENUE, AND ADJUSTED TOTAL REVENUE LESS TRANSFERS TO HOUSEHOLDS
Table 2 below shows adjusted total revenue, and adjusted total revenue less transfers to households for all three levels of government.
TABLE 2. ADJUSTED TOTAL REVENUE, Less Transfers to Households, and as % of GDP(a)
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
$m
$m
$m
$m
$m
$m
COMMONWEALTH
1. Adjusted taxation revenue(b)
226 095
245 292
254 367
250 793
260 704
274 012
2. Non-taxation revenue(c)
20 754
23 862
22 491
26 045
25 244
28 360
3. Adjusted total revenue =1+2
246 849
269 154
276 858
276 838
285 948
302 372
As % of GDP
16.5
17.5
17.3
17.1
17.2
17.2
4. Direct benefits to households(d)
113 444
118 512
126 309
129 925
131 574
129 596
5. Indirect benefits to households(e)
38 864
37 991
39 808
43 293
47 428
53 256
6. Adjusted total revenue, less transfers to households =3-4-5
94 541
112 650
110 741
103 620
106 946
119 520
As % of GDP
6.3
7.3
6.9
6.4
6.4
6.8
STATE
1. Adjusted taxation revenue(b)
138 531
143 641
153 587
164 418
174 520
182 585
2. Non-taxation revenue, excluding current grants from Commonwealth government(c)
66 778
59 782
68 007
66 962
65 571
72 320
3. Adjusted total revenue =1+2
205 308
203 423
221 593
231 380
240 091
254 904
As % of GDP
13.7
13.3
13.9
14.3
14.5
14.5
4. Direct benefits to households(d)
1 454
1 507
1 408
1 283
1 500
1 938
5. Indirect benefits to households(e)
4 459
4 749
5 341
5 340
5 208
5 164
6. Adjusted total revenue, less transfers to households = 3-4-5
199 396
197 167
214 844
224 757
233 383
247 802
As % of GDP
13.3
12.9
13.5
13.9
14.1
14.1
LOCAL
1. Adjusted taxation revenue(b)
17 456
17 797
17 657
20 091
20 139
22 263
2. Non-taxation revenue, excluding current grants from Commonwealth and state governments(c)
18 535
20 031
20 492
21 051
22 871
23 297
3. Adjusted total revenue =1+2
35 991
37 827
38 149
41 141
43 010
45 560
As % of GDP
2.4
2.5
2.4
2.5
2.6
2.6
4. Direct and indirect benefits to households(f)
. .
. .
. .
. .
. .
. .
5. Adjusted total revenue, less transfers to households = 3-4
35 991
37 827
38 149
41 141
43 010
45 560
As % of GDP
2.4
2.5
2.4
2.5
2.6
2.6
. . not applicable
(a) Based on GDP at current prices as published in Australian National Accounts: National Income, Expenditure and Product, December Quarter 2017 (Cat. no. 5206.0), Table 36 Expenditure on Gross Domestic Product (GDP), Chain Volume Measures and Current Prices: Annual.
(b) Derived in Table 1.
(c) Non-taxation revenue includes revenue from sales of goods and services, interest income, other property income (such as dividends, income tax equivalents, land rents and royalties), fines, capital revenue, and all current revenue other than grants.
(d) Direct benefits to households are monetary transfers.
(e) Indirect benefits to households are transfers 'in-kind' via goods and services.
(f) Local government does not make transfers of this kind to households.
Commonwealth taxation revenues
Commonwealth Government taxation revenue increased for all measures from 2015-16 to 2016-17:
Commonwealth taxation revenue was $389,797m, an increase of $19,405m (5.2%).
Commonwealth adjusted taxation revenue was $274,012m, an increase of $13,308m (5.1%).
Commonwealth adjusted total revenue was $302,372m, an increase of $16,424m (5.7%).
Commonwealth adjusted total revenue less transfers to households was $119,520m, an increase of $12,574m (11.8%).
Commonwealth adjusted total revenue less transfers to households as a proportion of GDP, increased from 6.4% to 6.8%.
Source(s): Taxation Revenue, Australia
State government taxation revenues
State government taxation revenue increased for all measures from 2015-16 to 2016-17:
State taxation revenue was $82,255m, an increase of $3,158m (4.0%).
State adjusted taxation revenue was $182,585m, an increase of $8,065m (4.6%).
State adjusted total revenue was $254,904m, an increase of $14,813m (6.2%).
State adjusted total revenue less transfers to households was $247,802m, an increase of $14,419m (6.2%).
State adjusted total revenue less transfers to households as a proportion of GDP, stayed at 14.1%.
Source(s): Taxation Revenue, Australia
Local taxation revenue
All measures of Local taxation revenue increased from 2015-16 to 2016-17:
Local taxation revenue was $17,418m, an increase of $798m (4.8%).
Local adjusted taxation revenue was $22,263m, an increase of $2,124m (10.5%).
Local total revenue less transfers to households was $45,560m, an increase of $2,550m (5.9%).
Local adjusted total revenue less transfers to households as a proportion of GDP, stayed at 2.6%.
Source(s): Taxation Revenue, Australia
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