Next Budget must tackle superannuation tax breaks for the rich: Anglicare
New report highlights inequality in superannuation concessions and tax breaks
By Chris Shearer
April 3 2018
Australia spends nearly $21 billion each year in superannuation concessions and tax breaks for the wealthiest 20 percent of Australians, says new research commissioned by Anglicare Australia.
The Cost of Privilege, a research paper prepared by progressive think tank Per Capita for Anglicare, found that the remaining $15 billion worth of super concessions and tax breaks were shared by the middle 60 percent of Australians, while the bottom 20 percent received none.
Anglicare Australia Executive Director Kasy Chambers said the figures showed super concessions and tax breaks were not working in the way the public had been lead to believe.
“For years, we have been told that superannuation tax breaks and concessions are about helping ‘average’ Australians. Our research shows that is simply not true,” said Anglicare Australia Executive Director Kasy Chambers.
“It beggars belief that we could spend this much on tax breaks while 100,000 people are waiting for aged care packages.
“Without action, we will end up with more and more people retiring into poverty while the wealthiest Australians take advantage of these concessions to minimise their tax.
“Our superannuation system was meant to help people save for their retirement. We must stop it from becoming a tax haven for the wealthiest Australians,” said Ms Chambers.
According to the report, the total cost foregone tax revenue from the richest 20% of Australians – including through negative gearing, capital gains tax concessions, discretionary trusts and GST exemptions – is over $68 billion each year, or around $37 a week from every worker in the country.
In comparison, the total cost of Newstart to the budget in 2016-17 was just under $11 billion, or $6 per worker per week.
“If the Government is serious about balancing the budget with retaining a fair and just society, the place to cut government spending is on the cost of subsidizing the accumulation of wealth by rich Australians, not reducing essential support to our poorest citizens,” the report’s authors wrote.
“Our report shows that characterisations of the poorest Australians as a burden on the economy are inaccurate and, if we are to worry about unnecessary imposts on the budget, there is a very strong case for reducing tax concessions and other direct benefits to our wealthiest citizens.”