We're the bracket who earn enough to support ourselves and our families without the help of government benefits but not enough to be labelled rich. You could say we're comfortable, but not without careful budgeting, regular reshuffling of financial priorities, and what I like to call retail offsets. We can indulge, for example, in a sizeable slab of vintage cheddar each week because we pick up our fruit and veg at markets. Our teenagers wash their hair with bulk shampoo from The Reject Shop (one litre for $5) so I can lather mine in expensive purple goop from the salon to keep my blonde from going brassy. Our household budget pivots on countless of these first-world gives and takes.
Don't get me wrong. I'm acutely aware - and very appreciative - that my earning capacity and home ownership (even with a mortgage) place me among the wealthiest workers in the world. The 2015 Credit Suisse Global Wealth Report ranks Australian households third for global wealth. But it did niggle when I read recently that Australian households earning $80,000 to $180,000 — about 14 per cent of tax payers — pay the nation's lion's share of tax. And it really pricked my sense of justice when I learned that nearly half — 48 per cent — of Australia's tax payers are not actually chipping in at all. What they fork out they get back in pensions, family tax benefits or childcare rebates. In other words, they pay no net tax.
On average, in 2014, Australian families paid $12,935 in income tax, but received $9,515 in benefits — a net annual contribution to the public coffers of just $3,424.
I'm no economist but that seems a somewhat fruitless, and even futile, approach to taxation. The current debate about tax reform seems to be skirting around this dilemma. What's lost in the headlines and panic about whether the GST is going up or negative gearing being scrapped is an understanding that we may need to share the load a little more evenly. I'm not for a minute suggesting genuinely vulnerable low-income earners receive less help or fork out more. Nor am I balking at some level of support to offset the costs of raising children. But I am advocating that those who can afford it put in their share - or at least not be able to take out as much as they pay.
It's also worth pointing out that, as a whole, we're not taxed as much as we might think, when compared to other economies. In 2006, Treasury reported we had the eighth lowest tax burden among 30 OECD nations. Mexicans paid the least tax (albeit not the fiscal yard stick by which we want to measure ourselves), while the Swedish tipped in the most. The upside for the Swedes is that they revel in 480 days of paid parental leave, five weeks' minimum annual leave, and free university degrees. All that and good looks!
I'll leave it up to our politicians and bean counters to determine if our tax pie needs to be larger to support our ageing population and world-class aspirations. The ship seems to have long-sailed on affordable tertiary education for our children, so I suspect we'll need more pastry some time soon. Whatever the size of the pie, all I ask is we slice it a little more equitably than we do now.
In the meantime, I won't hold my breath for that thank you card from the treasurer. But if Scott Morrison is considering the notion, The Reject Shop has a reasonable selection for $1. He could pick up some cheap shampoo and conditioner while he's there.
