The rich to get huge tax cuts under Scott Morrison’s plan   
Wealthy Australians - including Scott Morrison - will be $11,640-a-year better off under proposed tax cuts. But it’s a different story for others.   


News.com.au
SEPTEMBER 3, 2020

Treasurer Josh Frydenberg has hinted that personal income tax cuts worth $20 billion could be brought forward.
Part-time workers will score a measly $255-year under the tax cuts the Morrison Government is considering bringing forward but the wealthy including Prime Minister Scott Morrison will ultimately secure a stunning $11,640-a-year windfall.   

Wealthy families on six figure salaries are on track to secure huge windfalls worth up to 20 times the value of low income and part-time workers under the legislated tax cuts by 2025.

That prompted a warning that the Morrison Government would be better off increasing welfare payments or tax cuts for low income workers if they really want people out spending to stimulate the economy.



ANU Associate Professor Ben Phillips told news.com.au that the rich are more likely to stash tax cuts into savings accounts and pay off personal debts including credit cards and big mortgages, rather than spending the money and stimulating the economy.

“We know that people are saving at higher rates than ever. It will have some small impact. But most people would say you get a bigger bang for your buck with tax cuts at the lower income end or welfare,’’ he said.


The Australian Council for Social Services is urging the Morrison Government to deliver a permanent increase to JobSeeker before it fast-tracks tax cuts for the rich.

In a discussion paper, Restoring growth: Tax cuts or payments and services?, ACOSS warns bringing forward the tax cuts won’t stimulate the economy if the wealthy workers don’t spend the money.


“The second and third stages of the Government’s proposed tax cuts are skewed towards high income-earners. In the context of high household debt, much of these tax cuts will be saved,’’ the discussion paper states.



“In contrast, a $75 a week increase in Newstart and related allowances for single people and single parents would mainly go to the poorest households and regions. Since they have little choice but to spend any extra dollar on essentials like food and rent, the money would be quickly spent, lifting jobs and growth in the regions that need it.”

The tax cuts the Morrison Government is considering bringing forward are worth $20 billion and are currently scheduled to come into force in 2022.


Treasurer Josh Frydenberg has repeatedly flagged he is considering bringing forward the tax cuts to help kickstart the economy.

“Again, we’ll provide those details when we get to the Budget, because obviously these are issues that are still under consideration and what we did take to the last election was a three-stage plan which would see the abolition of a whole tax bracket, 37 cents in the dollar tax bracket,’’’ he said.

“It would see 94 per cent of Australian taxpayers pay a marginal rate of no more than 30 cents in the dollar. One big tax bracket between $45,000 and $200,000. It’s important that people recognise that tax cuts put more money into people’s pockets. More money into people’s pockets means more spending and more spending means more jobs. But these are still under consideration, so I don’t want to add to the detailed speculation, you’ll have to wait until Budget day.”



The second stage of the tax cuts the Morrison Government has flagged it is most likely to bring forward will lift the income threshold when the 19 per cent tax rate kicks in from $41,000 to $45,000 and the rate at which the 32.5 per cent tax rate applies from $90,000 to $120,000.

A third stage of the tax cuts, with a tax rate of 32.5 per cent to apply to the vast majority of workers, is currently scheduled from 2024.

It will apply a 32.5 per cent tax rate on all income between $41,000 and $200,000.

That’s the tax change that will ultimately deliver the Prime Minister a $11,640 a year tax cut.

By comparison, a part-time worker earning $30,000 a year will secure just $255-a-year from the planned tax cuts.

A worker earning $75,000-a-year secured a $1080 a year tax cut under the original 2019 tax cuts rising to $1830 by 2025.

But the biggest benefits of the tax cuts kick in when workers are earning six figures.

While the tax cuts are worth up to $2565 for anyone earning over $120,000 from 2023 the windfall gains for high income earners keeps rising.   

By 2025, or earlier if the tax cuts are brought forward, the tax cuts will deliver $4400 for a worker on $120,000 a year.

The carefully orchestrated campaign from the Government of Two Parties is proceeding apace and without let.... the campaign to reduce unto penury and thus economic despotism those who actually work for a living, while uttering inanities like 'trickle down will take care of you all' and 'what's good for business is good for the nation', and 'none of this outstanding government largesse to those with the capacity to do so will lead them to salt this extra lovely away where it pays no tax and perpetuate the never-ending drain on the economy and Budget, thus forcing the government to raise taxes overall on those with the least, to make it equal all round like Thatcher's tax on the number of people in a home' etc .....

Repeat 5000 times until someone believes it...

Well said Jest,  this is why come election time, one should think very carefully on who they vote for.   

I say we take off and Vote Independent from orbit ..... only way to be sure...

Working harder does not necessarily mean you will earn more.   

The Coalition will not touch Franking Credits, Capital Gains Tax or Negative Gearing which all cost the budget far more than they provide towards revenue....So the Coalition will cut taxes to the rich even though the budget is in far more debt and deficit than when they declared a National Budget Emergency in 2013....How is the Coalition going to fix the budget by giving more hand outs to the wealthy???

Gordon wrote on Sep 7^th, 2020 at 1:30pm:


The people who work the hardest earn the least ? You plan would fail.

whiteknight wrote on Sep 7^th, 2020 at 9:00pm:

If it wasn't for about 20 wasted years of conservative government, it would have been at 12% already.