Australian Wage Earners Pay Three Times More Tax Than Companies

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

14 August 2002

Taxation Statistics for 1999-2000, released by the Australian Taxation Office (ATO) on Monday revealed that during the period under examination, wage earners paid around three times more income tax than Australian corporations, despite earning just a quarter of the income made by companies.

Individual taxpayers earned some $330 billion in wages and salaries during the 1999/00 fiscal year, on which they paid $76.77 billion in income tax. Australian companies, on the other hand, earned $1,245.56 billion in income, but paid just $26.35 billion in tax.

The ATO figures also revealed that the rich are getting richer, while lower income taxpayers hardly saw any shift in their earnings during the period in question. Reporting on the implications of the statistics, The West Australian on Monday noted the fact that: 'Australia's wealth is increasingly being concentrated in Sydney where average incomes rose strongly.'

The newspaper report added that: 'By contrast, average incomes in Australia's bottom 10 postcodes barely moved from a year earlier.'

Speaking following the release of the ATO statistics, Acting Tax Commissioner, Michael D'Ascenzo explained that the overview of the Australian tax system and income and tax profile of 11.9 million Australian individuals, companies, funds, partnerships and trusts was intended to 'help business operators to compare the performance of their business with others in their industry.'

'Tax practitioners will be able to use this more detailed information to assist their clients to more effectively manage their businesses,' he added.

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