ACTU tax modelling shows that single people battling on incomes of only $540 a week will be forced to pay $2500 more in tax over the next term of a Howard Government.

Releasing the modelling at a National Summit on the Integrity of the Tax System in Sydney today, ACTU President Sharan Burrow said:

“This modelling shows that since 1996 the top end of town has gained from tax cuts and tax rorts under the Howard Government while low and middle income taxpayers have lost out.

ACTU modelling of bracket creep, the GST and tax cuts since 1996 including those announced in the recent Federal Budget shows that over the next three year term of a Howard Government from 2004-07:

  • Around seven in ten taxpayers (70%) – everyone earning less than $52,000 a
    year – will effectively pay more tax with around one million low income earners
    paying from $1900 to $2500 extra.
  • At the same time, people on more than $52,000 a year will pay less tax –
    with those on $80,000 a year set to get an effective tax cut of more than
    $5,800.
  • People earning just above the minimum wage on incomes around $25,000 to
    $30,000 will be slugged up to $19 a week more in effective tax.
  • The worst affected are single people who receive no help from the Howard
    Government’s family payments.

    • Besides the unfairness of the tax changes, low income people have been hit with prices for basic services rising up to twice the general rate of inflation thanks to the Government’s shift to user pays and the running down of publicly provided services.

  • Attacks on Medicare and the axing of the public dental health scheme has
    seen health costs jump 28% while dental costs are up 46%.
  • A dramatic rise in the cost of university education and the chronic
    under-funding of state schools in favour of wealthy private schools has seen
    education costs rise 53%.
  • Home ownership costs are up 37% thanks to Government tax breaks for well-off
    property investors causing overheating of the property market.

    • This analysis shows that top end tax cuts and rorts are leaving low and middle income battlers further behind.”