Anglicare Australia has launched a report showing that Australia’s tax system is fuelling wealth inequality.
Paying it Forward profiles ten OECD countries and finds that:
- Australia is one of the only countries that does not tax inheritances or estates
- This is fuelling wealth inequality
- Superannuation has become a tool for wealthy families to build inheritances, instead of being used to fund retirement.
“Australia is becoming more unfair and more unequal. Our research shows that we are one of the only countries in the OECD that doesn’t tax big inheritances,” said Executive Director Kasy Chambers.
“This has turbocharged inequality, concentrating wealth among a smaller and smaller group of people.
“It also means that more of the tax burden has been pushed onto people who earn income from work.
“Past research from Anglicare Australia has already shown that much of this wealth is built using unfair tax breaks. Now we’re seeing that wealth that has been built with taxpayer support can be passed on virtually tax-free.
“We should be using our tax system to make Australia fairer. Instead, Government policies are driving inequality and making it worse. The good news is that we know what needs to be done to turn this around.
“We are calling on the Government to look at an estate or inheritance tax, to make sure we stop more and more wealth from being concentrated among fewer and fewer people.
“That tax must also apply to high superannuation balances. Superannuation is supposed to be about funding retirement. The Government must restore the purpose of superannuation, and stop the system from becoming another way for wealthy people to build wealth and pass it on without paying their fair share.
“Right now, people who earn income from work are paying more tax than people who earn income from their wealth. That needs to change if we want to make our tax system fairer. “Making these changes is about stopping inequality from getting worse, protecting our community from disunity, and restoring the faith of Australians that Government can work for them.”