Tax cut windfall: Regional NSW loses out

New analysis from the Australia Institute shows that regional NSW would receive below average benefits compared to the average Australian household from income tax cuts, outlined in the 2018 federal budget.

The figures represent the change in household disposable income (after tax income) as a percentage of change in the national average. Modelling also took into account tax cuts and other budgetary measures announced in the 2018 budget and then averaged out the benefit in dollar terms to each federal electorate.

“Our analysis shows eighteen regional electorates, that all come in below average.” said Matt Grudnoff, Senior Economist at The Australia Institute.

“Once the numbers are averaged across the nation, families in the lowest benefitting regional electorate of Lyne, only receive 76 cents for every dollar received by the average household. [See figure 2]

Sydney electorates would receive on average 118 cents for every dollar, while regional electorates would receive 88 cents.

“This tax cut is highly selective. In the highest paid electorate, the Prime Minister’s seat of Wentworth, households receive almost double the national average benefit, 

“The top 10 electorates all get at least one and a half times more than the national average. This is a tax cut that truly delivers for the top-end and leaves everyone else behind, [See figure 1]

“By political party, it is clear that in NSW the least benefit flows to National Party and Labor seats. And on a national scale, one quarter of Nationals’ seats are in the bottom 10 electorates, in fact all but one of their seats are ranked in the bottom half of electorates.” [See figure 3]

Figure 1. 

 

Top 10 electorates

Percentage of average

Party

1

Wentworth, NSW

192%

LIB

2

North Sydney, NSW

180%

LIB

3

Warringah, NSW

172%

LIB

4

Sydney, NSW

167%

ALP

5

Melbourne Ports, VIC

160%

ALP

6

Higgins, VIC

159%

LIB

7

Bradfield, NSW

158%

LIB

8

Kooyong, VIC

156%

LIB

9

Grayndler, NSW

154%

ALP

10

Goldstein, VIC

150%

LIB

 

Bottom 10 electorates

Percentage of average

Party

141

Longman, QLD

77%

ALP

142

Cowper, NSW

77%

NAT

143

Port Adelaide, SA

76%

ALP

144

Lyne, NSW

76%

NAT

145

Wide Bay, QLD

76%

NAT

146

Wakefield, SA

73%

ALP

147

Braddon, TAS

72%

ALP

148

Lyons, TAS

72%

ALP

149

Hinkler, QLD

71%

NAT

150

Blaxland, NSW

70%

ALP

 

 Figure 2.

Rank

Electorate

Percentage of average

Party

1

Wentworth

192%

LIB

2

North Sydney

180%

LIB

3

Warringah

172%

LIB

4

Sydney

167%

ALP

5

Bradfield

158%

LIB

6

Grayndler

154%

ALP

7

Mackellar

132%

LIB

8

Kingsford Smith

131%

ALP

9

Berowra

130%

LIB

10

Reid

125%

LIB

11

Cook

121%

LIB

12

Mitchell

121%

LIB

13

Bennelong

117%

LIB

14

Hughes

116%

LIB

15

Eden-Monaro

102%

ALP

16

Macquarie

101%

ALP

17

Newcastle

101%

ALP

18

Banks

100%

LIB

19

Cunningham

98%

ALP

20

Robertson

97%

LIB

21

Barton

97%

ALP

22

Hume

97%

LIB

23

Greenway

96%

ALP

24

Parramatta

94%

ALP

25

Lindsay

92%

ALP

26

Shortland

90%

ALP

27

Clare

89%

NAT

28

Hunter

89%

ALP

29

Whitlam

88%

ALP

30

Parks

86%

NAT

31

Farrer

86%

LIB

32

Riverina

85%

NAT

33

Dobell

85%

ALP

34

Macarthur

85%

ALP

35

Richmond

84%

ALP

36

Paterson

83%

ALP

37

New England

83%

NAT

38

Gilmore

82%

LIB

39

Werriwa

81%

ALP

40

McMahon

80%

ALP

41

Chifley

78%

ALP

42

Watson

78%

ALP

43

Page

77%

NAT

44

Cowper

77%

NAT

45

Lyne

76%

NAT

46

Blaxland

70%

ALP

Total

New South Wales

105%

Figure 3.

 

Rank

Percentage of average

Party

1

127%

LIB

2

100%

ALP

3

82%

NAT

Total

105%

*The electorate of Fowler was excluded because it failed NATSEM’s validation test

Source: Australia Institute calculations; Analysis from NATSEM’s STINMOD+Tas/Transfer model and Spatial MSM18 spatial microsimulation model

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mail@australiainstitute.org.au

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