Earn
The tax cuts and cash boosters in the works for Australians
The effectiveness of the Morrison government’s income tax cuts has been called into question, but one tax expert has outlined some of the benefits for millions of Australians.
The tax cuts and cash boosters in the works for Australians
The effectiveness of the Morrison government’s income tax cuts has been called into question, but one tax expert has outlined some of the benefits for millions of Australians.
Speaking with nestegg, senior tax counsel with The Tax Institute, Bob Deutsch, believes the flatter tax brackets will be encouraging for Australian taxpayers.
“I fully endorse anything that is simplified as long as it’s not unfair. The Stage 3 changes, I think, are a very important simplification,” he said.
“The long bracket from $45,000 to $200,000, I think it very much addresses the aspiration desires of Australians,” said Mr Deutsch.
“Millions of Australians will be sitting in that bracket from $50,000 to $150,000. For them, any future pay increase once Stage 3 is in place will not push them into a higher bracket for a long time. I think that is really the key benefit to all of this,” continued Mr Deutsch.
Are the changes fair?
The argument against the Stage 3 tax cuts has been around someone on $46,000 will have to pay the same tax as someone who is making $199,000.
However, Mr Deutsch believes this is simply untrue.
“It’s true they are paying the same marginal rate on the next dollar,” he said.
“Overall, when you add up what happens taking into account all the brackets, the person on $190,000 will be paying significantly more tax,” said Mr Deutsch.
Is this system future-proofed?
The tax profession has long been calling for genuine tax reform to deal with the complexities of the Tax Act and the inefficiencies of some heftier taxes, like stamp duty on property purchases.
Though these changes from the Morrison government don’t necessarily constitute tax reform, they represent some of the tweaks the tax profession has been calling for.
“The system is still progressive even under Stage 3. If you look at the total tax paid at each level of $10,000. It is progressive in the sense that the overall tax rate increases as you go higher and higher.”
This email address is being protected from spambots. You need JavaScript enabled to view it.
About the author
About the author
Tax refund
Treasurer unveils tax cuts for millions of Aussies
Ten million Aussies are hundreds of dollars richer following the now announced extension of the low and middle income tax offset. ...Read more
Tax refund
Tax cuts or hikes: Which way will Frydo swing
The government is said to be “committed to lowering taxes”, but the Treasurer has not yet made his intentions clear heading into tonight’s big budget reveal. ...Read more
Tax refund
Dodgy links and spelling errors, ATO confirms latest phishing scam
The ATO has alerted taxpayers to a new phishing scam, which cons victims into updating their myGov information. ...Read more
Tax refund
Top 4 no-go expenses if making WFH claims this year
The ATO has issued another tax-related reminder for those working from the kitchen bench, outlining scenarios that do not qualify for the temporary shortcut method. ...Read more
Tax refund
Taxpayers told to keep on top of their WFH costs ahead of tax time
Taxpayers are being reminded to stay on top of their work-from-home logbook ahead of tax time 2021. ...Read more
Tax refund
Scrap tax returns and give everyone $3,000: think tank
Australia should move on from the hassle of a tax return and instead adopt an opt-in standardised $3,000 deduction covering all work-related and personal deductions, a think tank has said. ...Read more
Tax refund
Calls for government to end fossil fuel subsidies
Subsidies to the fossil fuel industry cost the federal, state and territory budgets over $10 billion a year despite calls for Australia to do more on climate change, a new report has revealed. ...Read more
Tax refund
Is it time for a super profits tax?
With the surging price of iron ore and the sizeable profits miners are now pocketing, former prime minister Kevin Rudd has renewed calls for a super profits tax that would see mining companies invest ...Read more
Has the property market reached its peak; Biden’s climate summit and our sharemarket, and the upcoming budget
Listen now
Is the market overheating; should ETFs take your fancy, and what’s happening to the low and middle income tax offset?
Listen now
Home values up 30% (or are they); NFTs taking the world by storm, and why Keating thinks Aussies will be ‘poor’ in retirement
Listen now
Raging floods, the tech stock bubble and the ongoing SG debate
Listen now
Tax refund
Treasurer unveils tax cuts for millions of Aussies
Ten million Aussies are hundreds of dollars richer following the now announced extension of the low and middle income tax offset. ...Read more
Tax refund
Tax cuts or hikes: Which way will Frydo swing
The government is said to be “committed to lowering taxes”, but the Treasurer has not yet made his intentions clear heading into tonight’s big budget reveal. ...Read more
Tax refund
Dodgy links and spelling errors, ATO confirms latest phishing scam
The ATO has alerted taxpayers to a new phishing scam, which cons victims into updating their myGov information. ...Read more
Tax refund
Top 4 no-go expenses if making WFH claims this year
The ATO has issued another tax-related reminder for those working from the kitchen bench, outlining scenarios that do not qualify for the temporary shortcut method. ...Read more
Tax refund
Taxpayers told to keep on top of their WFH costs ahead of tax time
Taxpayers are being reminded to stay on top of their work-from-home logbook ahead of tax time 2021. ...Read more
Tax refund
Scrap tax returns and give everyone $3,000: think tank
Australia should move on from the hassle of a tax return and instead adopt an opt-in standardised $3,000 deduction covering all work-related and personal deductions, a think tank has said. ...Read more
Tax refund
Calls for government to end fossil fuel subsidies
Subsidies to the fossil fuel industry cost the federal, state and territory budgets over $10 billion a year despite calls for Australia to do more on climate change, a new report has revealed. ...Read more
Tax refund
Is it time for a super profits tax?
With the surging price of iron ore and the sizeable profits miners are now pocketing, former prime minister Kevin Rudd has renewed calls for a super profits tax that would see mining companies invest ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
