An exclusive new poll has revealed that more than half of all Australians want to see personal income tax cuts in this year’s Federal Budget.
The Ipsos Poll, conducted on behalf of Chartered Accountants Australia and New Zealand (CA ANZ), quizzed more than 1,000 people across the country.
It asked: The Budget is to be released on 8 May. Tax cuts are being discussed by both parties. Who should receive a tax cut?
Results showed that 60.2% of respondents said individual tax payers should receive a personal income tax cut.
A tax cut for small businesses was the second-most popular choice with 44.5%, with a reduction in the company tax cut ranking third with 15.7%.
Michael Croker, CA ANZ’s Australian Tax Leader, says the results showed strong support for lowering tax rates, and cuts need to be meaningful for the target group.
“Across the world we’ve seen reductions in company and personal tax rates – but our tax settings have remained steady, with the perception that we are uncompetitive,” says Croker.
“These results show that Australians want change. But we still need to find the revenue to fund the essential services we need, particularly when it comes to health and our ageing population.
“International trends, and the support for tax cuts at home, underline a need for realigning our tax system away from heavy reliance on income tax, and towards increased reliance on GST.
“Our GST rate of 10 per cent is low compared to nations like New Zealand at 15 per cent and the UK at 20 per cent. Further, we tax less than 50 per cent of the potential GST consumption base.
“New Zealand on the other hand taxes 96 per cent of the potential base and it’s widely regarded as the world’s most efficient and simple GST.
“Our modelling in 2015 showed how Australia could switch to an expanded GST base covering education, health and financial services in a fair and affordable way.
“If it was increased to 15 per cent across a broadened base, it could generate $265 billion over four years.”
With work-related deductions in the ATO spotlight, the Ipsos Poll also asked Australians for their opinion about what action, if any, should be taken to combat inflated deductions:
- The status quo should remain so that no cap is applied on any expenses claimed as a tax deduction: 47.3 per cent agreed.
- A cap should be placed on the amount that can be claimed by individual taxpayers for all work and other expenses: 26.7 per cent agreed.
- A cap should be placed on the amount claimed for other expenses by individual tax payers: 21.5 per cent agreed.
“The results show strong opposition to introducing any sort of cap on deductions,” says Croker.
“We urge the Government and Opposition to use this Budget as a platform to “talk straight” about the economic and social risks that face our nation, and be upfront about potential policy solutions.”
Tax cuts are being discussed by both parties. Who should receive a tax cut?
- Individual tax payers should receive a personal income tax cut: 60.2%
- Small businesses should receive a tax cut: 44.5%
- Company tax rate should be cut: 15.7%
- No tax cut but give all businesses a 20% deduction for any new assets: 4.6%
- None of the above / no one should receive a tax cuts nor deductions: 14.9%
Australians tax payers claimed deductions for other expenses totaling $7.9 billion in 2017. Do you think ...
- The status quo should remain so that no cap is applied on any expenses claimed as a tax deduction: 47.3%
- A cap should be placed on the amount that can be claimed by individual taxpayers for all work and other expenses: 26.7%
- A cap should be placed on the amount claimed for other expenses by individual tax payers: 21.5% Other: 4.5%
About Chartered Accountants Australia and New Zealand
Chartered Accountants Australia and New Zealand is a professional body comprised of over 117,000 diverse, talented and financially astute members who utilise their skills every day to make a difference for businesses the world over.
Members are known for their professional integrity, principled judgment, financial discipline and a forward-looking approach to business which contributes to the prosperity of our nations.