I.G. Report flags trouble ahead for Australia's disadvantaged

St Vincent de Paul Society National Council acknowledges the importance of forecasts contained within the 2023 Intergenerational Report (IGR) and how these must be used to shape Australia’s national blueprint.

‘We support the Government’s commitment to increasing productivity and prosperity through an inclusive approach that benefits all. However, we must take this opportunity to stress that Australia’s progressive taxation system can, and should, be strengthened to improve equality.

‘There are many groups out there with competing interests and priorities. Ours is to lift people out of poverty and increase affordable and secure housing options,' said Mr Mark Gaetani, National President.

Research shows corporate profits reached their highest share of [national] GDP ever in 2022. But over 122,000 Australians are currently homeless. Almost 60 per cent of JobSeeker recipients are living in poverty. And around half of those on working age payments are experiencing financial stress, compared to a national average of 14 per cent.

‘This is not the time to lower company tax rates or increase the GST. The GST is a blunt instrument – a regressive tax that disadvantages those already doing it tough. And given the current cost of living and housing crises, the Stage 3 tax cuts must be dropped,’ said Mr Gaetani.

Recent Parliamentary Budget Office costings found that the revenue forgone due to the Capital Gains Tax discount is around $1.5 billion in 2023‑24. Treasury estimates that the revenue foregone due to superannuation tax concessions is around $50 billion a year, with the cost of these concessions projected to exceed the cost of the Age Pension by 2050.

‘For these reasons, the Society has commissioned the Australian National University to model how to make the tax and welfare system fairer and reduce poverty. Revenue is generated by reducing the Capital Gains Tax discount and making moderate changes to personal income taxation thresholds and superannuation tax concessions.

‘We can lift between 193,000 and 834,000 people out of poverty by slightly increasing the annual tax paid by high wealth, high income households. This would cover the costs of increasing working age payments (such as JobSeeker, Parenting Payment and Disability Support Pension), and increase Commonwealth Rent Assistance by 25 per cent.

‘We agree the Government must lift productivity, manage the energy transformation and fund ballooning health and aged care services. But we can transform lives and improve the wellbeing of hundreds of thousands of Australians right now by making some simple changes,’ said Mr Gaetani.

Associate Professor Ben Phillips, a member of the Economic Inclusion Advisory Committee, is lead author of the report "A Fairer Tax and Welfare System in Australia" which will be launched at Parliament House on Monday 4 September 2023.

The St Vincent de Paul Society in Australia has more than 45,000 members and volunteers, who work hard to assist people in need and combat social injustice across Australia. Internationally, the Society operates in 153 countries and has over 800,000 members.

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