Briefing Note: Are government plans to tackle bracket creep good for average people?
The government has spent a considerable amount of time talking about bracket creep with a particular focus on average incomes ‘creeping’ into the second top tax bracket. The government seems increasingly likely to focus any income tax cuts to prevent these average wage earners from being pushed into the second highest tax bracket. An example of how the government could achieve this is by increasing the threshold of the second highest tax rate from $80,001 to $100,001.
While the discussion has left the impression that these tax cuts are designed to give tax relief to average Australians the reality is very different. Most of the benefit of such a tax cut is likely to flow to high income earners. They are also likely to flow overwhelmingly to men.