James Kirby [$]: “As a survey, the annual tax statistics are only a very vague guide to wealth in Australia. But as a window into how wealthy Australians do or don’t find themselves in the front line of taxpayers the survey is considerably more useful. … [W]e might not have assumed you can bring in a total income of more than $1m a year and declare a taxable income of less than $6000 tax per annum. In fact, there are 42 people noted in the report on such an arrangement… A quick read of the ATO personal tax tables would suggest if you made an income of $1m a year you might pay about $450,000 in tax, that is if you did nothing much to be tax effective [sic]. The survey indicates the wealthiest operate in a very different manner and we have a complex system with complex tax shelters which are available to anyone who goes looking for them. Due to our progressive, but uniquely arranged tax system, there is an extensive menu of tax effective strategies for dealing with income tax: Companies, trust, lending arrangements and other tax effective shelters that can be employed when people make serious money. … [T]he most revealing way to look at the survey is to compare its headline income numbers against home prices. This week we heard that there are 150 suburbs in Sydney with house prices over $1m. And yet the ‘average taxable income’ in Sydney suburbs with the most enviable residential properties is invariably less than $200,000. … Either the median real estate valuation is too high (which is unlikely) or the indicative taxable income levels are too low.”
11 June 2021