77% of the benefits of the Stage 3 tax cuts will go to the richest 25%
This week the Parliamentary Budget Office has released costings on the legislated Stage 3 tax cuts that will:
- remove the $120,000 to $180,000 tax bracket
- increase the top tax bracket threshold from $180,000 to $200,000
- reduce the marginal tax rate faced by the $45,000 to $200,000 tax bracket from 32.5% to 30%.
The PBO estimates the tax cuts will cost a cumulative $243.5bn out to 2032-33. Of that amount, 6% will go to the richest 1% of income earners and 77% will go to the richest 25%.
With our progressive income tax system, the high-income earners rightly pay a larger share of taxation than do the poorest. However while those earning over $180,000 are just 3.7% of income earners and pay 31% of total income tax, they will receive 48% of the total benefits of the stage 3 tax cuts out to 2032-33.
The Stage 3 tax cuts are massively inequitable and will lock in greater inequality and less revenue to provide for necessary government services and programs.
Luciana Lawe Davies Media Adviser