Taxation has been the subject of recent media and public debate, focussing on issues of tax fairness among different kinds of families and the use of the tax system as a vehicle to deliver social policy. In 1999, the debate centred around the deduction for child-care expenses which is not available to families where one parent is at home caring for children. The primary purpose of the tax system is to raise revenue for the functions and benefits provided by the state. It is also designed to meet a number of often-conflicting social objectives and to cover a multitude of economic situations. Economic growth and stability, and the encouragement of international competitiveness have generally been given priority over the achievement of greater social equality, including gender equality.
Taxation can be a powerful instrument of social policy.
It can promote social objectives by redistributing resources. It can reduce or increase the gap in living standards resulting from market incomes. Tax policies can either support or hinder parents in their important job of raising children by either recognizing or ignoring the extra costs of children on the family budget. Equally important, the tax system can advance or hinder gender equality. While the design of the tax system does not directly discriminate against women, it does not consider the differences in social and economic circumstances between men and women, and between those with and without children.