Young Australians Are The Big Losers When It Comes To The Government’s Latest Tax Cuts
$4 billion is a hell of a lot of money to spend, but how much of it is going to young people?
Last week the federal parliament voted to spend $4 billion on income tax cuts for Australians earning over $80,000 a year. The policy was proposed by Malcolm Turnbull back in May but was passed with the support of Labor and One Nation. Good to see Pauline Hanson looking out for the humble battler!
The tax cuts benefit the top 20 percent of income earners. An analysis by the Greens found that they would disproportionately benefit men compared to women and it’s been argued that they will worsen inequality in Australia.
In the generational debate that’s been playing out over the past few days policies like negative gearing often get raised as an example of how the government is rigging the system to benefit wealthy, older Australians. A report by The Australia Institute found that people under 30 only receive 6.4 percent of the benefit of negative gearing and superannuation tax concessions.
But what about this latest tax cut? $4 billion is a hell of a lot of money to spend, but how much of it is going to young people? Surprise, surprise, not very much.
A Junkee analysis of data from the Australian Taxation Office has found that only seven percent of 18-29 year olds will benefit from the latest tax cut. The other 93 percent of young taxpayers earn less than $80,000 a year and therefore won’t have their tax bill reduced.
On the other end of the spectrum, nearly one in four working Australians aged 50-65 will reap the rewards of the government’s $4 billion largess. According to tax data most 18-29 year olds earn less than $55,000 a year and are therefore unlikely to financially benefit from tax cuts targeted to the upper range of income earners.
So the government’s latest tax policy, even if it wasn’t designed explicitly to do so, has bypassed the overwhelming majority of young Australians. While we’re struggling to crack into the housing market and paying off our student debts, the government is showering older Australians with money through negative gearing, superannuation tax breaks and now these income tax cuts.