New economic research reveals that the Stage 3 tax cuts proposed by the Federal Government will give Bank CEOs, surgeons, and federal politicians a windfall tax cut of $9075, while low-income workers like aged care workers, disability careers and minimum wage employees get $0.
The proposed Stage 3 tax cuts will see those earning more than $200,000 raking in the biggest benefit, while those on less than $45,000 will receive nothing, according to new report from the Australia Institute entitled Fair Go Gone: Stage 3 tax cuts & LMITO by Occupation.
When the Low- and-Middle-Income Tax Offset (LMITO) ends, middle-income earners like teachers, nurses and midwives will pay $1080 more in tax.
Key Findings:
- Stage 3 tax cuts mainly go to high income earners with those earning more than $200,000 receiving a tax cut of $9075 per year, with CEOs, all federal parliamentarians and surgeons winning big.
- Those earning less than $45,000 will get nothing from the stage 3 tax cuts, with aged workers, disability carers, bakers, hairdressers and minimum wage workers among those worst off.
- If the Low and Middle Income Tax Offset is not extended it will end this financial year & will mean 90% of taxpayers will be paying more tax.
- Even after the stage 3 tax cuts come in, 80% of all taxpayers will still be worse off.
- The LMITO goes to middle income earners with a maximum rate of $1,080. If the LMITO is not extended in the budget later this month occupations like teachers, nurses and midwives will be paying $1080 more in tax.
"Our research reveals that under this plan it's billionaires that benefit while battlers get slugged," said Chief Economist Dr. Richard Denniss from independent think-tank the Australia Institute.
"How is it reasonable that a bank CEO earning $5.2m a year will be given a $9,000 tax cut, while someone working in aged care or on the minimum wage receives nothing?"
"The Stage 3 changes mean, someone earning 45,000 will now pay the same marginal tax rate as someone earning $200,000.
"By cutting taxes for the higher-come earners, this extreme plan will make our tax system permanently less fair. It's an attack on Australia's fair-go, progressive tax system."."
"The stage 3 tax cuts also mainly go to men. Men get 67 per cent of the tax cuts while women get 33 per cent. This means that for every dollar of tax cut going to women, men get $2."
"The Stage 3 plan not only fails the pub test, it's bad economics.
"Low- and middle-income earners are more likely to spend their tax cut back into the economy, creating jobs and growth, while the highest income earners are more likely to stash the additional cash away. This plan will increase economic inequality in Australia."
Stage 3 tax cuts are to come into effect in 2024.
