In a previous paper The Australia Institute did an income distributional analysis of stage 3(a) of the tax cuts. This paper will look at the income distributional analysis of stages 1(a) and 2(a). It will also look at a different income distributional analysis of stage 3(a). The previous paper looked at the benefit of stage 3(a) that went to different deciles. This paper will look at the benefit of stage 3(a) going to two fixed income groups, those earning more than $180,000 and those earning more than $200,000.
The paper finds that those earning more than $180,000 will get $33 billion from the unlegislated stage 3(a) of the tax cut over the five-year period from when it first starts in 2024-25. It also finds that those earning over $200,000 will get $26 billion over the same period.
It also finds that about half the benefit from stage 2 and stage 2(a) will go to middle-income taxpayers. High-income taxpayers will get 38 per cent and low-income taxpayers will get just 13 per cent.