Anglicare Australia’s Widening the Gap report reveals the richest people hold 90 times the wealth of low-income earners, and the gap continues to grow.
The average wealth of the highest one-fifth of income earners was $3.2 million, which was 90 times the lowest earners bringing in $36,000, the report based on 2019-20 University of NSW analysis found.
“Australia is becoming more unfair and more unequal,” executive director Kasy Chambers said.
Financial inequality has been supercharged by tax breaks on superannuation, housing investments and sky-high home prices which have locked many Australians out of the market.
Over the last 20 years, the report found, the average value of superannuation assets grew by 155 per cent while investment property rose by almost 100 per cent.
Chambers said the growing gap is a direct result of government policies on tax which are driving inequality.
However, Anglicare Australia said the solution lies in changing the approach of governments to tax.
The welfare group wants the federal government to wind back “generous” superannuation concessions for wealthy Australians and instead help low-income earners build their retirement savings.
Anglicare Australia also called for housing tax breaks like capital gains tax discounts and negative gearing deductions to be wound back.
It further called for investment incomes to be taxed fairly to prevent people earning money from work being taxed more than those financially benefiting from wealth.
Chamber said that the average rent was eating up more than 40 per cent of a person’s income compared to only 20 per cent two decades ago and that Commonwealth rent assistance was propping up a “broken private rental system” and failing to address the key drivers of unaffordable rents.
“This is a choice that’s been fuelled and driven by government policy and it’s a choice we can do something about,” she said.
“Things like white goods and holidays have actually come down in price in real terms whereas the basics, particularly housing, particularly rent, have just skyrocketed.
“So if you don’t have any spare in your budget, then you’re feeling inflation way, way higher than those who got that spare, that fat, to cushion things.”
Anglicare Australia called for investment incomes to be taxed fairly to prevent people earning money from work being taxed more than those financially benefiting from wealth.
“Making these changes is about stopping inequality from getting worse, protecting our community from disunity, and restoring the faith of Australians that government can work for them,” Chambers said.
– AAP
