Most Australians don’t get to choose how much tax they pay – or don’t pay. But some at the top end of town have been able to under Scott Morrison’s Liberals.
There were 26 people who earned over $1 million and paid no tax had an average deduction of $630,000 for managing their tax affairs.
These people should not get a tax break just because they have access to loopholes their experts can help them with.
Labor will cap the amount an individual can claim as a deduction for managing tax affairs at $3,000.
This deduction and cap affects individuals only, and other business-like structures such as trusts and partnerships that are taxed as individuals, and not companies.
A carve-out is included for individual small businesses with positive business income and annual turnover up to $2 million.
When announced, it was estimated that this would affect around 82,000 people. That’s less than 1 per cent of the population.
For over 6 million Australian taxpayers, their average deduction was just $375.
These are just some of the ways we are closing tax loopholes used by the top end of town.
These reforms will save around $375 million over the forward estimates.