TAX POLICY AND GLOBALISATION: A COMPARATIVE CASE STUDY OF RETIREMENT SAVINGS TAXATION

Economic growth and population ageing have been important influences on social policy spending since the mid 1960s.(1) However, over the past 25 years the potential impact of a third influential factor has been introduced: globalisation. While economic factors remain highly relevant, questions are being raised about the role of globalisation in social policy. A number of theories exist on the impact of globalisation on social policy. Two theories are most frequently debated; firstly, that globalisation limits the ability of the state to control social policy and secondly, that globalisation is not the cause of the perceived 'welfare state crisis' and factors such as cultural perspectives and ideologies create resistance to the path of globalisation in social policy. The paper investigates the influence of globalisation on tax policy, using the taxation of retirement savings in Australia and New Zealand as a comparative case study. Over the past two decades Australia and New Zealand have adopted vastly different policy solutions to the 'problem' of population ageing; Australia with generous tax concessions and compulsory occupational superannuation, New Zealand with a small tax incentive and a universal state pension. These different approaches are analysed within the framework of the globalisation literature.