A Progressive Tax System Is As Bad As Racism, Says Right Wing Think Tank

We’ve heard some wild justifications for the government’s plan to slash taxes for the mega-rich, but this one really takes the cake: a right wing Australian think tank has actually claimed that making rich people pay their fair share of tax is discrimination against rich people, comparable to racism.

That think tank is the Institute of Public Affairs, and they made the racism claim in a submission to a parliamentary inquiry into the tax bill in question. The submission starts by welcoming the government’s plans to cut taxes for the rich, then argues that they’re not happening soon enough (the government’s plan was to gradually ease into the huge tax cuts, delivering the full set of changes by 2024).

Then, things get really cooked. A progressive tax system, the IPA argues, “discriminates against Australians by income”.

“Other forms of discrimination, such as by skin colour, race, or ethnicity, are rightly abhorred,” the submission continues, “yet the income tax system openly discriminates against people by income”.

Let’s take a step back for a moment and really consider that claim: the IPA is seriously telling Parliament that they think rich people paying more tax than poor people is similar to racism. They’re comparing people having slightly less money — albeit still more money than the average Australian — to the violence, discrimination and stigma faced by people of colour due to arbitrary, baseless hatred. They’re saying that being rich is somehow a kind of oppression, because it requires paying some tax.

The IPA? say that wealthy people paying their fair share of tax to fund Australia's schools & hospitals is akin to racism in their submission to the Parliamentary Economics Committee. #auspol pic.twitter.com/fqKTTY3rXi

— Australian Unions (@unionsaustralia) June 5, 2018

The submission goes on to argue that also, progressive taxation “provide[s] powerful incentives to keep poor people poor”, because people are discouraged from earning more by the knowledge that the tax system will take more money away from them. Never mind that what’s actually keeping poor people poor is stuff like “simply inhumane” welfare payments, the kind of thing that can be raised when rich people are paying their fair share of tax.

The IPA also takes a moment in its submission to have a big whinge about how too many people are being hit with the highest marginal tax rate, which kicks in once a person is earning $180,000 (or $200,000, under the government’s proposed changes). This, the IPA sniffles, is “low by international standards”, as it affects people earning only 2.2 times the average full time wage, whereas in the US the top tax rate only applies to people earning eight times the average full time wage.

Some would say it’s a good thing that people earning double the average Australian wage are being asked to put in their fair share, but not the IPA. Rich people having slightly less money, after all, is like racism.

You can find the full IPA submission here, if you’d like to read this garbage for yourself.