WA tax cut windfall

The Australia Institute has analysed the average electorate household benefit* from the income tax cuts announced in the 2018 Budget, as a proportion of the National Average benefit.

 The figures represent the change in household disposable income (after tax income) as a percentage of change in the national average.

“It’s very visible in a state like WA, to see that the benefits of income tax cuts will flow to electorates in high income earning areas.

“While the biggest winners are all wealthy city electorates in like Perth and Curtin, the losers are spread across electorates like Forrest and Burt.” said Matt Grudnoff, Senior Economist at The Australia Institute.

“It’s no surprise that Forrest ranks so poorly. This tax cut is highly selective, so even though Forrest encompasses more affluent areas like the city of Bunbury, the electorate also covers regional areas, which is where we are seeing the least benefit.”

“Once the numbers are averaged across the nation, families in Forrest receive 91 cents for every dollar received by the average household,

“Meanwhile the highest earning electorate of Curtin would receive 150 cents for every dollar. See figure 1.

“This tax cut is highly selective. The electorates of Curtin, Perth, and Stirling all receive well above the benefit received by an average household.

“It’s a tax cut that truly delivers for the top-end and leaves everyone else behind.”

Table 1: Electorate Total

Rank

Electorate

Percentage of average

Party

1

Curtin

150%

LIB

2

Perth

126%

ALP

3

Stirling

117%

LIB

4

Tangney

116%

LIB

5

Moore

115%

LIB

6

Swan

112%

LIB

7

Fremantle

111%

ALP

8

Hasluck

98%

LIB

9

Pearce

94%

LIB

10

Canning

93%

LIB

11

Cowan

93%

ALP

12

Brand

93%

ALP

13

Forrest

91%

LIB

14

Burt

90%

ALP

Total

WA

107%

*Source: Australia Institute calculations; Analysis from NATSEM’s STINMOD+ Tax/Transfer model and SpatialMSM18 spatial microsimulation model

Note (*): The WA total is inflated because two of the electorates that are likely to lower the average (O’Connor and Durack) did not pass NATSEM’s validation test.

General Enquiries

Tanya Martin Executive Assistant

02 6130 0530

mail@australiainstitute.org.au

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0413 208 134

jake@australiainstitute.org.au

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