Summary of proposal
Party
Australian Greens
Policy Topic
Taxes
Portfolio
Treasury
The proposal has 5 components that would modify the Australian personal income tax system.
- Components 1 and 2 would not proceed with Stage 3 of the Personal income tax plan in 2024-25, and would introduce a new tax bracket for those earning more than $1 million from 1 July 2022.
The personal income tax schedule would be as follows:
| Taxable income | Tax rate |
|---|---|
| 0 - $18,200 | Nil |
| $18,202 - $45,000 | 19 cents for $1 over $45,000 |
| $45,001 - $120,000 | $5,092 plus 32.5 cents for each $1 over $45,000 |
| $120,001 - $180,000 | $29,467 plus 37 cents for each $1 over $120,000 |
| $180,001 - $1,000,000 | $51,667 plus 45 cents for each $1 over $180,000 |
| $1,000,000 and over | $420,667 plus 60 cents for each $1 over $1,000,000 |
- Component 3 would amend the Low-Income Tax Offset (LITO) as follows.
- A maximum offset of $2,250 for individuals earning $30,000 or less.
- The maximum offset would reduce by 10 cents for every $1 above $30,000 up to $45,000.
- The offset would reduce by a further 3 cents for every $1 above $45,000, phasing out at $70,000.
- Component 4 would introduce a ‘Buffet rule’ which would limit tax deductions to $5,000 for individuals earning $360,000 or more (around the top 1% of earners).
- Component 5 would implement a minimum tax rate of 30% on non-primary production discretionary trust distributions to mature beneficiaries.
- The minimum tax rate would be applied to the total trust distribution, rather than on a marginal basis. Non-trust income would continue to be taxed at marginal rates, with an individual’s tax liability on this income assessed exclusive of discretionary trust income.
- The minimum tax rate would not apply to distributions from discretionary charitable trusts, deceased estate trusts, or testamentary trusts.
Components 3, 4 and 5 would be implemented on 1 July 2022