The Tax Maven

Tax Policy and the 14th Century Fresco (Miranda Stewart)

Episode Summary

Melbourne’s Miranda Stewart has a passion for tax law that led her halfway around the world to NYU Law’s tax LLM in the late 1990s, helping launch her prolific career as a scholar. Now, Professor Stewart teaches, writes and advises governments about improving the relationship between people and their governments and the role that tax policy can play in promoting transparency. In this episode, Stewart describes the way the tax law intersects with gender, human rights, good governance and the rule of law. She also explains why she has an Italian fresco on her home page and what it says about the role tax plays in society. She answers a pencil question based on an article by UCLA’s Eric Zolt.

Episode Notes

Miranda Stewart is a professor and the director of Tax Studies and the Tax Group at Melbourne Law School and also a fellow at the Tax and Transfer Policy Institute at Australian National University’s Crawford School of Public Policy. Her scholarship addresses an extraordinary range of topics related to tax policy, including transparency and economic development.

Her work takes up the challenge of envisioning tax laws that do more than just generate revenue.  She sees those challenges depicted in a beautiful fresco painted by Ambrogio Lorenzetti in Siena Italy in the 14th century titled Allegory and effect of good and bad government. And painting may be just about the only thing Professor Stewart has not mastered: When she is not writing or teaching, she advises governments and think tanks about tax policy. Stewart and Dean talk about the connections she sees between how we govern ourselves and how we collect taxes.  

This episode also features a recording by one of our students, Rommell from Metro Manila, Philippines, reading a quote from United States v. Murdock, 290 U.S. 389 (1933). 


  1. Professor Stewart’s biography
  2. The Pencil Question article: Eric M. Zolt, "Prospects for Fundamental Tax Reform: United States vs. Japan," 83 Tax Notes 903 (1999).
  3. Professor Stewart’s contributions to The Conversation
  4. Professor Stewart's CV
  5. The case featuring the student-read quote: United States v. Murdock 

Episode Transcription

Speaker 1: All of us should be willing to pay whatever taxes are necessary to enable efficient government to improve or expand any essential service.

Speaker 2: You have a beautiful tax returns, the nicest one I'm going to say.

Speaker 3: Okay folks, but remember your manners, no stampeding. Walk slow, like you do when you come to pay your taxes.

Steven: This is The Tax Maven. Here we are going to, in each episode, talk to our tax maven, who'll be a person proving Archimedes point, that a single person with a lever long enough and a place to put it, can change the world. The lever in this case is tax and the place to put it is here at NYU Law.

Steven: I'm here today with Professor Miranda Stewart. She is a professor of law at the University of Melbourne Law School. She, like most of the people who we're going to talk to, is a tax maven. We are going to talk about her scholarship. We are going to talk about her love of teaching. We are, of course, going to ask her a question that is going to determine whether or not she earns a lovely NYU Law Graduate Tax Program pencil.

Steven: If you go to Professor Stewart's website, that's, you're going to be confronted with a fresco, an old Italian painting about good government.

Miranda Stewart: The fresco on my website, which I put together so I could just organize all my material which was all over the place, is Lorenzetti. It's an Italian painting. It's actually a whole wall, a fresco of good government, and it's in Italy. On the other wall is bad government. And so I'm interested, fundamentally, in taxes as a way to finance government, and the relationship between taxes and tax policy and law and budgets and government. This fresco just symbolizes that for me.

Steven: What's so important about good government for tax policy and why is that so fundamental to you? Because obviously you put it front and center on your website, it must be something you think is really essential, why is that?

Miranda Stewart: Well, you might say the fresco, there's something about the medieval representation of good government, or the renaissance representation, which is compelling. Which is a few hundred years old now, so maybe not so applicable. So, a few things, I guess the first is why do we have taxes? And, of course, really there has to be some other purpose, they don't just exist for their own sake. They could exist to fund some king, or fund a war, or fund rent-seeking coercion. I'm interested in them existing to fund good government for public wellbeing. And then I guess you could turn it around and say that we need to govern our tax system in a way that is fair and effective and accountable and transparent. I'm interested in all those things too.

Steven: Professor Stewart is a professor of law at the University of Melbourne Law School, as I mentioned, but she also wears a variety of hats. She is also the director of The Tax Group, and she's also a fellow at the Tax and Transfer Policy Institute at the Crawford School of Public Policy, the Australian National University. She also does a lot of consulting and advising work in addition, and she writes a great deal about a wide variety of topics, some of which we'll talk about shortly. But before she did all those impressive things that you can read about on her website, she was a student here at NYU Law.

Miranda Stewart: Oh, I loved NYU. I'm not ashamed to say when it was, so I was in the class of '98. I think I was in the second year of the International Tax Program in the LLM at NYU. It was very exciting for me to come from Australia to study at NYU. I was recommended by a professor of mine there. Professor Paul McDaniel was director of the International Tax Program at that time. Yeah, no, it's a transformative experience for me. And then I taught here for a couple of years, straight after I graduated, with Paul McDaniel.

Steven: And you haven't stopped.

Miranda Stewart: I haven't stopped, so it was the beginning of an academic career for me. Previously I graduated from law at Sydney University and I had worked in the tax office, so the revenue in Australia, for about three years, and then I worked in the private sector, in a large law firm for a few years, advising large mining corporations. And then I came to NYU to study, and that was the beginning of a academic career for me.

Steven: And so now you do a whole variety of things; you teach you, you write, and you advise a lot of government actors. Do you have a favorite part of the job? Do you like the variety? How would you describe that?

Miranda Stewart: The variety is great. I guess that's the pinnacle of an academic career, is to be able to do all those things, to be able to consult. I've done consulting over the years for private sector firms and clients as well as for government agencies, currently doing a piece of work, for example, for a non-government organization in Australia on the relationship between the environment and tax policy, doing a bit of consulting for them. I love teaching, I must say. I always teach mostly in my specialist field, mostly in graduate programs in Australia and elsewhere. I do love that teaching and students.

Steven: Professor Stewart is a tax expert. She has studied tax both here and in Australia. She has written extensively about it. She's advised governments, she advised private clients on transactions. We know that she understands how the tax rules work. But another aspect of the work that Professors Stewart does is trying to think about the deep structure of the tax laws, both what they reveal about us as a society, and to understand the effects they have on us.

Miranda Stewart: I'm interested in... As I said, it's related to good government, again. Some of my research, and in fact I think some of yours as well, Steven, is to do with the processes of taxation, tax information, governing tax systems, if you like. I'm interested in collecting taxes effectively because I think that would support human rights on the whole. But I'm also very concerned about the legitimate collection of taxes, that there does have to be... There do have to be clear limits and clear accountability and transparency. Some public choice theorists who you might associate with small government, or anyway, anti-government, are not so much... They're more interested in the idea of defining the obligation of the taxpayer to the state. And so I think transparency is important, both from the government to taxpayers, that the government discloses their finances, their tax law is certain and clear. And then also, of course, from taxpayers, including large multinational corporations, to government. We have this increasing demand for tax information in order to enforce tax systems.

Steven: So the transparency is both revealing what taxpayers are doing, or not doing, and also what the government is doing or not doing?

Miranda Stewart: In fact, the whole discourse or transparency, of course, it goes back hundreds of years. It's mostly been about governments being accountable to the people. It's mostly been about transparency of government. And even in the 90s when we had this sort of resurgence and an interest in transparency as a policy goal, it was about governments, about budgets being transparent, about anti-corruption activity, transparency international and anti-corruption organizations established in the early 90s. It's only in the last decade that we also see the reverse, that is that taxpayers need to be transparent to government. For large corporations I think that's pretty obvious, I support that. For individuals, I'm a little more concerned about privacy and maintaining taxpayer privacy.

Steven: For those of you who don't spend all your time thinking about taxes, Professor Stewart and I do, what she's referring to is there's been a big move over the last decade, or so, to reveal more information about taxpayers, to promote enforcement. Some of this has been prompted by scandals such as the Panama Papers, pick the papers you want to talk about, but there's been a lot of scandals.

Miranda Stewart: The Luxembourg Leaks.

Steven: The Lux Leaks, yeah, lots of good headlines out of all this. But one of the responses... I think it's fair to say that there's a fascination with this kind of information and a hope for what it can do. They really does parallel the power of DNA in the criminal law context, that we're sure that this is going to be the solution, and if we just do enough of this that enforcement is going to follow. Your observation, I think is consistent with that, but also there are questions that it raises, that maybe we're not grappling with sufficiently.

Miranda Stewart: Yeah, I think that's right. There's this increasing demand, and I think need, for tax information, so the more widespread, the more complex the tax system becomes, and especially as governments and as people, and then governments cooperate more and more cross borders. People are more mobile, capital is more mobile, and governments are speaking to each other to try to enforce their tax systems, so then you have much more use of that tax data and information than we ever had before. Obviously that is a good thing, we want our governments to know when taxpayers have income hidden offshore in secret bank accounts. That does make sense. I think the concerns are partly about legitimate governance and making sure, for example, that if your taxpayer data here in the US. was exchanged with a government in another country, that your privacy would be maintained, the data wouldn't be misused. But also information itself is not enough, so you said enforcement. The whole goal, ultimately, is to collect the right amount of tax, it's not just to know stuff about people for no good reason.

Steven:  No, that's fair. I think part of maybe the subtext of what we're talking about, is the importance of the rule of law. You referred to good governance earlier. I do think that that is at least a part of what we're aiming for with all of this, with the transparency of the government, transparency of the taxpayers. The hope is that we'll achieve a more desirable state of rule of law. Is that fair?

Miranda Stewart: Well, that's right. I think you need... There's quite a lot of research about the relationship between tax and democracy. It's a fraught relationship or an unclear relationship, but there does seem to at least be some correlation between reasonably effective and legitimate tax systems and some sort of democratic accountability and transparency. Ideally, we would have a positive reinforcement, right, where we would collect taxes effectively, mostly for the use of public good, and that that would also help us shore up and enforce our democratic systems. In reality, I think all tax systems and all governments fall down, right, but the goal would be to try to achieve that positive reinforcement.

Steven: When you look at Professor Stewart's work, one of the things you're going to be struck by is that there is a lot of it, and you're also going to be struck by the variety that you see in that work. It doesn't all seem to be the same article written over and over again. There's a lot of difference. But there are also clear connections that emerge when you talk to her. She is interested in good government. She's interested in transparency. But when you get down to it, what she's interested in is justice.

Steven: Your work is really varied in an impressive way. Another totally, to me, unrelated topic but maybe you'll tell me it's related. In 2015 you gave a presentation titled "Gender And Tax: The More Things Change, The More They Stay The Same". That was now a few years ago. Do you have a sense that things have changed now, or stayed the same, or both?

Miranda Stewart: I have another strand of research and you're very polite and just saying how much work I do. Some might say I'm spread too thin. That would be the alternative way of looking at it. The relationship is, first of all, justice. I'm interested both in accountability and in justice. We think of distributive justice to do with progressive taxes, obviously. I tend to think more broadly about both taxes and social security, what we call transfers and in some economic speak, taxes and transfers as a system, cash in, cash out of government, if you like.

Miranda Stewart: And so the gender analysis work I do is about the position of women and men in both tax and social security or tax and welfare systems. Particularly it's about Australia on the whole because it's unique to that system, but you can do a gender analysis of any tax system. There are ways in which the system, although it looks neutral, the tax laws don't say women or men on the whole, they're facially neutral. But because women and men are differently situated in the economy and in the household and in terms of care, responsibilities, they get affected differently by tax and welfare systems. That's an ongoing challenge, I think. We still have systemic biases in the tax and welfare system.

Steven:  Can you give us an example of one of those biases? Maybe it's different in Australia and here, but what's an example of something that might be different?

Miranda Stewart: Well, perhaps I'll try and think of an example that might be similar, but although in the law it's different. So in the US you have a married tax unit, been in the law for a long time, mostly joint tax filing. Of course you can have spouses filing separately, but the rates are less advantageous on the whole. In Australia we have individual taxation, tax on the basis of the individual so, of course, that is different. But our welfare system, cash payment system, which is possibly a little more expensive than yours, we have family payments, child care benefits, that sort of thing, are tested on family income. So it's a quasi-family unit. For families that have children, they pay tax on an individual basis, but they're tested for their cash benefits on a family basis. It's complicated.

Steven:  That does sound complicated.

Miranda Stewart: Right? Either system, the married tax unit or the system we have, this quasi-family unit, tend to discriminate against women as second earners in a household. So if women go out to earn income when they could be looking after kids, the household will essentially pay more tax. They also have net costs because they have to buy in childcare and pay for the cost of working. And so I see that as discriminatory against women's work. I would be in favor of an individual unit for men and women and more universal child payments to support women's work.

Steven:   No, that is certainly something that is the same. The concern is the same in the US, although you're right that in the US when you're married you generally file your tax return jointly rather than individually. I didn't realize that Australia is one of those jurisdictions where you file individually. That avoids problems, the problem we have here, either the marriage penalty, where you pay more tax when you get married, or the marriage bonus, which maybe isn't a problem depending on how you look at it, where you pay less tax when you get married. So you solve that problem in Australia with individual filing.

Miranda Stewart: Yes.

Steven:  But I wouldn't have known that you would then have a different problem, or the similar problem, on the transfer side.

Miranda Stewart: That's right. Actually, quite a lot of countries are like that. They have an individual unit in the tax system, unlike the US. I mean Germany has joint filings, other countries, but many countries, Canada, the UK, have individual filing in the tax system, but they reproduce the marriage penalty effect in their transfer system or social security system.

Steven: All right, so now I'm going to stop talking about things you know and start talking about things you don't know, or maybe you know, we'll find out. I have with me here, this beautiful NYU Law Graduate Tax Program pencil.

Miranda Stewart: I really want that pencil.

Steven: Oh, well, let's see what we could do here. The question I'm going to ask you about today is about powerful women. I'm going to tell you about three, and one of them basically lost their job because of tax policy. Are we going to see if you know which of the three this was? The three possibilities are A, Catherine the Great, Empress of Russia from 1762 to 1796, Corazon Aquino, the 11th president of Philippines from 1986 to 1992, or Margaret Thatcher, the prime minister of the United Kingdom from 1979 to 1990. One of these three lost their job because of their tax policies.

Miranda Stewart: That's a very interesting question. I am going to go for Margaret Thatcher.

Steven: That is correct. So the story... Here's your pencil.

Miranda Stewart: Oh, that's so exciting.

Steven: I got this tidbit from Eric Zolt's article, "Prospects For Fundamental Tax Reform: U.S. Versus Japan". It was published in Tax Notes. He wrote, "While a head tax, which is a tax imposed on each individual... " Tax nerds like us know what a head tax is, but other people might think it's a tax on heads, which it kind of is, but mostly isn't. It's a tax that everybody pays individually. I would pay the same as Bill Gates, which is absurd for lots of reasons. That may strike some as fair. "The fall of Margaret Thatcher's government regarding replacing a property tax with a per-person community charge," Zolt writes, "illustrates the political costs of misreading what the public considers fair."

Steven: You are right, Margaret Thatcher tried to embrace this idea of a head tax, which a lot of people would support as a theoretical matter, but few, certainly before and now after Margaret Thatcher, are willing to take a chance on it in the political sphere, so nobody's proposing a head tax in the upcoming Australian election.

Miranda Stewart: No, we would... In fact, we would have watched the UK pretty closely and we all know about Margaret Thatcher's loss of power.

Steven: Is that right? I didn't realize I was giving you a... give me a question but....

Miranda Stewart: Yeah, because of what we call the poll tax, which is the same, yeah, a head tax, and the riots that resulted in London because of that tax. There actually were riots.

Steven:  Okay. So...

Miranda Stewart: But it's a political lesson for many.

Steven: Apparently a lesson you and Australia learned quite well. All right, well, I want to thank you very much for speaking with me today. It's been fun.

Steven:  Thank you for listening to The Tax Maven. I also want to give a very special thank you to those that help make the podcast possible; Patrick Kelly, Joe Rivera, Greg Addison, Leslie Hart, Rebecca Carmichael, Jill Rachlin, and Anthony Pietrangelo.

Steven: The NYU Law Graduate Tax Program has been the premier place to learn about tax law for the past 75 years, so please visit us on the web. Visit our graduate tax program website to see the different programs we offer, both in person and online, both for lawyers and non-lawyers. Take a look at what we offer, and I hope you consider joining us.

Steven: And now, we like to end each of our episodes with a quote about taxes read by one of our students. Today's quote is by Rommel, a student from Metro Manila in the Philippines. He offers us a quote from a case, U.S. v. Murdoch, and I think you'll see why he finds it meaningful.

Rommel: Congress did not intend that the person, by reason of a bonafide misunderstanding, as to its liability for the tax, as to his duty to make a return, or as to the adequacy of the records he maintained, should become a criminal by his mere failure to measure up to the prescribed standard of conduct.

Steven: Please email us at if you have any questions or comments or suggestions. If you are a student, and want to email us a recording of your favorite tax quote, please email it there as well. Thanks for tuning in.