News Media have done it again.
They’ve figured out that if they apply the label 1% to the wealthy then everyone else will blindly agree with their attacks and claims that they got wealthy because they cheated the system somehow or all 1%’ers live large with some kind of Bruce Wayne type lifestyle.
I’ve even seen attacks on the 1% claiming all are a bunch of tax cheats and because of this, all “normal” people have to suffer. What a load of horseshit.
So I wanted to quickly cover two points. Firstly, how much does a 1%’er really earn in Australia and secondly, How someone can pay no net tax but not be avoiding tax.
How much income is wealthy?
Firstly let’s face the stark reality of what high income really means in this country. The average income in Australia is $75,000 per annum. To enter the top 10% requires a paltry $89,000 per year and the top 1% earn only $227,000 or more.
Even to enter the so called Uber Riche in this country of 0.1% is less than $690,000 of income. That’s still only 6 figures.
So when, you’re attacking the wealthy, you’re not slaying demons like Gina, or Clive or even the young turks like Lachlan Murdoch or James Packer.
You’re throwing stinging barbs at your neighbours and friends. The guy down the street whose car has already left his driveway before you get out of bed in the morning. The mum who’s rushing to pick her kids up from after school care before it closes. The dad who snatches a few moments with his family during the day because he knows he’s going to be working late again tonight.
You think you’re sticking it to “Da Man” when really, all you’re doing is making yourself look like a loser and hurting the people in your life. The Tall Poppy syndrome in this country is sickening and makes us all look petty and lazy.
Paying no tax is not tax avoidance.
Under Part IVA (4a) of the Income Tax Assessment Act of 1936, known as the general anti-avoidance provision, you are avoiding tax when you enter into a scheme or arrangement whereby the dominant purpose is to avoid paying tax. Even if the scheme or arrangement complies with the technical requirements of the law.
A company may have paid no tax but still operated within the letter of the law because of the purposes of their actions. Likewise, the so called wealthy 1%’er up the road from you may have paid no tax because he used his tax money to fund his financial independence strategy as is completely legal to do.
Just like a low income earner may pay no net tax because he has 2 children and receives more back per year in Centrelink benefits and FTB than he pays in PAYG tax.
Let’s stop letting the media manipulate us into believing there’s some kind of class war going on out there when in reality we’re all just trying to do our bit to get by and plan for an uncertain future.