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Taxes are an integral part of state revenue. Taxes are designed to bring resources from citizens to governments. Income tax in Australia South Australia was the first colony to introduce a common income tax in 1884, all states collected income tax by 1907, and in 1916 the Commonwealth government passed the first federal income tax law. From 1916 to 1942, the state and Commonwealth governments increased their revenues through income tax. During this time there were different tax rates between different governments. State and Commonwealth Government The same income tax system was introduced in 1936 when the Income Tax Assessment Act 1936 (ITAA36) was enacted and adopted by the states. Important Note: Click Trusted Tax Accountants in Tarneit to avail of tax, accounting, and bookkeeping services in Australia. In 1942, the Commonwealth government increased taxes as a wartime measure. As a result, all agreements with the United States were suspended and fundamental changes were made to Aust...