Australian PM Likely To Include Tax For High Earners In Next Budget

by Mary Swire, Tax-News.com, Hong Kong

27 April 2009

Australia's Prime Minister Kevin Rudd could bolster his forthcoming Budget with tax increases for high-income earners, it has been announced.

Speaking on Australian radio, Mr Rudd described the latest Budget (which will be delivered on May 12) as the hardest he has ever had to co-ordinate due to increasing economic pressures and falling tax revenues.

Rudd explained that keeping the Budget fair was his top priority - which will ultimately mean that any planned income tax hikes must swing in favour of lower earners and not those with large annual incomes.

The Prime Minister is hoping to increase funding for pensions and stem rising debt. He explained:

“Longer term you have to look at what can be afforded by way of additional support from those who are better off.”

“A pensioner is not out there earning AUD150,000 (USD107,383) a year. There is a question about fairness in Australia to how you balance it out."

“We think Australia is all about fairness. People who are at the upper end, over time, perhaps could be in a position to provide greater support.”

Rudd's proposal shadows the one unveiled days earlier in the UK's Budget, by Chancellor Alistair Darling. UK residents earning more than GBP150,000 (USD219,169) per year will now be taxed at a 50% rate, as opposed to the previous 40%, as the government struggles to lift the economy out of recession.

Recommended