Rich men on big salaries will get the biggest windfall from the coalition’s plans to get rid of an entire income tax bracket.
Modelling from The Australia Institute shows the plan to axe the 37 per cent tax bracket and lift the threshold to $200,000 a year will disproportionately benefit men already earning big money.
The report released on Monday found 80 per cent of the 2024 tax cut will go to the highest income earners, with men the significant majority of those.
“Men will receive 70 per cent of the benefit of the tax cut and women only 30 per cent. For every dollar of the tax cut women receive, men will get $2.32,” the report said.
Labor and the Greens have not committed to supporting the final stage of the income tax plan, which the report says risks hurting Australia’s progressive tax system.
“The parts of the government’s income tax plan that are at risk of not passing the Senate are the parts that will overwhelmingly go to high income earners,” the report says.
The full force of the tax will cost the budget $16 billion a year once it is in effect
But Treasurer Scott Morrison says Labor’s refusal to back the tax cuts will rip income out of Australians’ pockets.
“Labor are always happy to commit Australian taxpayers to higher expenditure into the never-never, but not prepared to commit to give them responsible tax relief,” he said in a statement.
“Labor’s extra $70 billion slug on income taxpayers means the value of their higher tax proposals has now reached a staggering $290 billion over the next 10 years.”
The report’s author Matt Grudnoff also said the government was overstating the average Australian income and what it will be in 2024.
He said the median single-person wage is $55,000 a year, while for full-time workers it is $72,000 a year, and both are more representative of what Australians are earning than the average figures.