The Australia Institute has released data from modelling commissioned from NATSEM together with ATO statistics which show that young Australians are receiving little benefit from three of the budget’s most expensive tax concessions.
“Australians under 30 years of age receive only 6.4% of the combined tax concessions on superannuation, the capital gains tax discount and negative gearing,” Executive Director of The Australia Institute, Ben Oquist said.
“In total these concessions are worth more than $37B yet the young receive only $2.4B of their value.
“The capital gains tax discount and negative gearing are particularly unfair for the young, with the under 30s taking approximately 1% of the benefit of tax breaks worth $7.7B a year and climbing.
“It is a double hit for the young with many being priced out of the home owning market in part because of the very tax concessions they are mostly missing out on.
“It is often argued that tackling tax concessions is politically difficult, but the reality is that the bulk of the concessions flow to a relatively small proportion of the population and this is particularly true when it comes to younger Australians.”
“Australia has a revenue problem. A 2016 Budget that fails to recognise this will lack fiscal responsibility, economic credibility and fairness – particularly for younger Australians.
“Tackling tax concessions will not just be good for the budget and fairness, we now know it will help level the playing field for the young who get little from our distorted tax system.
“The Government has made much of the importance of intergenerational equity, there is nothing equitable about retaining expensive tax concessions that deliver a fortune to wealthy members of certain generations and virtually nothing to younger generations,” Oquist said.