Anthony Albanese’s decision to break an election promise in order to give more Australians bigger tax cuts will be discussed behind closed doors and over dinner tables around the country today.
How it will impact each individual really depends on how much you earn, something many don’t like to discuss.
Yahoo Finance has given nine Australians with salaries ranging from $45,000 up to $300,000 the chance to reveal their true thoughts on the contentious tax move with complete anonymity.
Some admonished the prime minister's lies, while others were happy to ‘cop it’ to help those struggling.
Here are their takes.
'Anyone whinging about this change is just a rich, well-off person who doesn't care about their fellow Aussies'
I think the changes made by the government are a good decision. The stage three tax cuts always benefited the top end of town, rather than the actual engine room of the Australian economy. Economically speaking, people earning under $60k are going to use any tax cut to put it straight back into the economy, which is the whole point of a tax cut.
For the people earning over $150k, any tax cut they get is more than likely going to go into their coffers and spent overseas on a holiday, or not spent at all. So, anyone whinging about this change is just a rich, well-off person who doesn't care about their fellow Aussies.
The new changes to the tax cut benefits over 11 million Australians across a wider spectrum of the economic landscape. It's being billed as a broken promise, but really it's a politician taking charge, looking at the changed landscape and making a new decision to benefit more Australians.
'Albanese flat out lied'
It’s absolute BS. They could have given lower-income earners additional tax breaks without penalising high-income earners, who aren’t necessarily wealthy. Some 700,000 Aussies are now worse off.
The federal government relies too heavily on income tax. Denmark is the only OECD country to tax income more highly. If the $180,000 bracket was indexed to inflation it would be over $260,000 now. Then there’s the fact Albanese flat out lied.
'A drop in the ocean'
Occupation: Full-time student and part-time chef
I definitely struggle with the cost of living. The rising price of groceries and rent means that I struggle to put any money aside for long-term goals like buying a house or emergencies.
I hate to think what it'd be like for someone less fortunate. In terms of fairness, I think the proposed changes are definitely a step in the right direction from the previous proposal but, ultimately, they do nothing to address the systematic injustice we see across the socio-economic and generational gaps.
The young and the poor will still struggle to get an economic foothold and the rich will still find it pretty easy to get richer, so no meaningful changes there. Personally, the proposed change would hand me a tax cut that would barely cover two weeks’ rent. That's a drop in the ocean. I would rather my money be invested in services and infrastructure that would actually make a difference, like affordable housing, cheaper education and climate solutions.
'People earning $200k should never have been given such a big tax cut'
I’m obviously disappointed in the change - having the benefit halved - but agree overall.
The extra ~$750 a month would have made a big difference to the increases in mortgage repayments I’ve had. In saying that, I appreciate those earning less would be doing it much tougher, so there had to be further changes to help them, and having someone earning $45k paying the same relative proportion of tax as someone earning $200k was never fair and inconsistent with our progressive tax system.
So, overall, I’m disappointed I’ll be getting $4.5k less but agree the changes had to be made. People earning $200k should never have been given such a big tax cut.
'Politically, this will be quite bad - breaking an election promise'
To be honest, when they were first announced/legislated, I was thinking, “You don’t need to be giving people a tax cut earning over $200k”. That works out as an extra $9k a year cash benefit.
It’s correct that stage three benefits high earners, however, it’s stage three. Low- to middle-income earners have already benefited from stage one and two, which have taken effect. So, I think it needs to be looked at with all three stages.
Also, the fact is high-income earners bear the highest tax burden, therefore, tax cuts will always benefit those who pay more tax the most. If you want to help low-income earners, don’t give them tax cuts as they don’t pay much tax. The support is better in forms such as subsidies (child care, prescriptions, energy support, etc).
Also, Albo made an election promise to keep stage three cuts and has said multiple times he will keep it. So, politically, this will be quite bad - breaking an election promise.
'Any additional money in the pocket is welcome'
Between rent increases, gas price increases (doubled last quarter), and GP visits (I’m out of pocket a minimum of $61.80 per standard consultation), any additional money in the pocket is welcome.
Also, as someone who used to make good money ($150k-$200k) I don’t think I would have been that fazed as the tax cuts wouldn’t have made much of an impact to my daily living.
'As long as it is going to help lower earners'
Industry: FIFO miner
Everyone is in dire straits with the cost of living but it is pocket change to me. I will cop that.
As long as it is going to help lower earners, absolutely. I am doing good and I know a lot of people aren't. It's like four days of work to me, it's honestly less. I hate that Albanese broke a promise but at the moment we [high-income earners] are the only ones doing alright with how things have changed after COVID and interest rates, inflation.
I have a home loan but I am not paying any interest because of the money I have in an offset account. Only trouble is that I am casual so I don't have that security. But I get paid for it. This cyclone coming could mean I can't work this week.
'As a nation who gives everyone a 'fair go', that’s what this does'
I believe this new overhaul is absolutely the correct thing to do. During the current cost-of-living crisis, we need to get money to lower- and middle-income earners - the ones who are being squeezed the most, since they already were squeezed the most.
As a nation who gives everyone a “fair go”, that’s what this does. We’ve already had reports out recently about how wealth inequality continues to get worse; the money continues to funnel to the top, and it’s clear that’s what the prior government’s tax-cut plans were meant to support.
If redoing that and breaking an election promise means we are giving more people a fair go, then I’m all for it.
'I’m glad the government has taken the courage to make these fixes'
Industry: Student and casual worker
As a student and only being available to work a limited amount of hours, it can be challenging to manage my expenses and it’s rare for me to save any money. My income fluctuates but I’m generally spending a third or more of my income on rent, excluding bills.
Sometimes I delay medical appointments or buying medicines because I feel that I can’t justify the expense. Having the extra money from the tax cut will make a difference for me. $800 is a lot of money in the context of my earnings and will help me feel more comfortable meeting expenses and being able to make a larger purchase that I otherwise couldn’t afford.
I think the changes to stage three are much fairer and I’m glad the government has taken the courage to make these fixes - lower-income people are the ones who are struggling most in the cost-of-living crisis, for us to miss out on a tax cut under the previous structure would have been unfair and a wasted opportunity to provide cost-of-living relief.