Tax cuts miss mark in Budget

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2 May, 2016 05:00 PM2 mins to read

Even the few offers of relief for taxpayers buried in the pages of the document will only affect a few Australians. Photo / Supplied

Three in four Australians are earning below amount where relief is expected to kick in.

Australian Treasurer Scott Morrison has warned his first Budget today won't be filled with sweeteners, and it looks like he's sticking to his word.

Even the few offers of relief for taxpayers buried in the pages of the document will only affect a few Australians.

The Federal Budget is expected to deliver tax cuts for Australians earning more than A$80,000 ($87,000), which is around what the "average" fulltime taxpayer earns.

The only problem is, the cuts will affect only a handful of taxpayers, with three in four earning below the amount where the cuts are expected to kick in.

The measure is designed to tackle bracket creep, with wage inflation estimated to push 300,000 middle income earners into the second highest tax bracket where they'll be taxed 37 cents in every dollar they earn over A$80,000.

But the offer of tax relief for high wage earners has irked the estimated 75 per cent of Australians earning below what Morrison has declared the "average wage".

A total of A$80,000 is the average wage (November 2015) for fulltime workers, which make up 68 per cent of the workforce. For all income earners, the average wage is A$59,000, according to the Australian Bureau of Statistics.

Opposition Leader Bill Shorten has also slammed the offer of modest tax cuts, saying Australians wouldn't be bought by a few dollars in cuts.

"For the last three years, every day, the Liberal Government has been pick-pocketing voters and now at the very last minute they are offering a few dollars in hope that all will be forgiven," he said.

While missing out on tax cuts, the Government is promising to top up superannuation accounts of the low paid, according to the Australian Financial Review. Overly generous superannuation tax concessions enjoyed by the rich will be reined in.

There will also be a A$5 billion kitty for major projects across the country.