The Morrison Government announced a slew of tax cuts as part of Tuesday night’s Federal Budget, but if you thought you’d be saving some sweet cash money over the next few years, think again because 80% of taxpayers are completely ignored in the new cuts.
Yes. 80% of people will receive precisely fuck all tax cuts under the government’s new plan, so hooray for your rich uncle Bob, who can probably buy a new yacht or something.
Most Australians will pocket just over $1,000 in tax cuts in the 2020-21 financial year, which is great. But don’t get too excited because only 20% of us will see those cuts the following year.
Anyone earning between $48,000 and $90,000 in the 2021-22 financial year will receive precisely *checks notes* zero dollars in tax cuts. For all of you playing at home, that is quite literally 80% of the tax-paying population.
We’re not just talking about the outliers here, who earn too little or too much, we’re talking about pretty much everyone you know. If you’re reading this, you’re almost definitely in this tax bracket. This *directly* impacts you.
“That’s a lot of people who will get nothing after next year,” Grattan Institute’s Associate of Budget Policy and Institutional Reform Tom Crowley told PEDESTRIAN.TV.
“There’s nothing new in this budget for them after next year.”
Many people have criticised the tax cuts, pointing out that they do far more to help the wealthier members of society (who still have high-paying jobs), while leaving those who are out of work, through no fault of their own, to fend for themselves.
“People without paid work will see no benefit from the income tax cuts brought forward in (the) budget, which mainly go to people who are lucky enough to have jobs, with the largest amounts going to people on higher incomes,” Australian Council of Social Service CEO Dr Cassandra Goldie told news.com.au.
“The country’s leading economists have been telling the Government that an adequate JobSeeker rate is far more effective than income tax cuts in generating the economic stimulus we need to rebuild out of recession.”
Interestingly, the tax cuts also aren’t predicted to do much for the economy as a whole, with Deloitte Access Economics economist Nicki Hutley pointing out on Monday’s Q&A that money will be better spent if given to people on lower incomes.
“We know people on lower incomes, if you put money in their pocket, they will spend it. We know that if you put money in the pocket of people on higher incomes, they’re more inclined to save it,” she said.
We’re not here to put a huge dampener on your hopes and dreams, but the Budget is confusing and overwhelming at best, so it’s worth knowing exactly where you stand, and how little this year’s Budget actually helps you.
Unless you’re on a six-figure salary, you might want to be strategic with this year’s tax cut, because there’s no more where that came from.