Therefore the overwhelming majority of working age Australians do not face high EMTRs.Governments face a delicate balancing act in setting means-tested taxation programs. They must balance offering financial help to the people who need it most against the need to ensure that this financial help does not discourage these people from working, or penalise them for doing so.
The 14th AMP.NATSEM Report explores effective marginal tax rates (EMTRs), or how much of an additional dollar of income is kept by Australians after income tax is deducted and means-tested Government support is withdrawn. The study shows that almost nine in every 10 working age Australians face an effective tax rate in their next dollar of income of 40 percent or less. Therefore the overwhelming majority of working age Australians do not face high EMTRs.