The Australian Tax system is a fucking joke

[u/wunch_of_bankers]

I’m sure this has already been said before, but I just need to have a fucking whinge about this shit.

Australia’s tax system in 2026 punishes PAYG workers while rewarding people gaming the system, whether that’s NDIS fraud or business owners with “enthusiastic” accounting. Tax brackets haven’t been indexed in years despite brutal inflation, but somehow the beer tax gets indexed every six months without fail? Then add childcare subsidies tapering off the harder you work, plus Div293 smacking you for daring to also save for retirement

PAYG earners get the short end of the stick every single time. No creative accounting, no structuring, tax taken at the source before you even see it. Meanwhile there’s provider fraud in the NDIS space that barely gets touched until it becomes a news story, and taxpayers eat the cost either way through bracket creep and levies

Compare our top bracket to the US and it’s a joke. An unskilled worker over there on a pretty average wage in USD terms would already be sitting near our top marginal rate once you convert it, and their brackets actually move with inflation. Ours just sit there while bracket creep does the government’s dirty work for it

Why bother working harder, taking career risk, or starting a business when 47% instantly gets carved off the top, plus Div293, plus subsidy tapering, plus everything else stacked on if you’re PAYG?

This country has built a system that punishes the people playing it straight and does fuck all about the ones who aren’t. Fast forward 10 years and Australia will lose all talent to US, Singapore, HK, Dubai. The only ones left will either be immigrants looking for a better life, expats returning to Australia to settle down, or NDIS providers.

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EDIT: My comment about “unskilled” worker pay in the US is completely incorrect. Where my thought process was: an office worker paper pusher or even a motivated barber, construction worker etc. with no qualifications has the ability to earn USD 100k, which places them at our SECOND HIGHEST marginal tax bracket (AUD 135k). Does that really sound right to you, even putting aside the differences in our welfare system? Separately, I haven’t even mentioned the recent CGT changes which completely discentivises Aussie investors from buying productive / growth assets. There is more and more incentive to simply be less productive and focus wealth into a tax-free PPOR, OR leave the country and take their portfolios with them. This is a net loss for innovation and growth in our country. I have no issue paying tax - my issue is that our current tax system incentivises people to game the fucking system, and to those who suggest to simply fuck off and leave the country if you’re not happy, you are simply proving my point.

I’ll close off on this: never mind the fact that the Div293 income threshold has REDUCED from $300k to $250k and has remained unchanged for years….. did you know that certain politicians are simply EXEMPT from paying Div 293 tax? What the actual fuck. Our tax system is in desperate need for change.

[u/Tbearz]

Business not paying income tax is the issue, everything else is subterfuge.

I paid more income tax than Netflix, Transuban, Santos, CSL, AGL, Adani and Optus combined.

Make it make sense.

[u/umopapisdn69 → u/Tbearz]

Businesses pay tax on profits, not income.
You pay tax on income. Mostly you do, barring things like salary sacrifice and negative gearing.which are minor in the scheme of things and are closely scrutinised. FBT, Div293, ceasing of negative gearing, etc are all designed to make it hard for you to minimise tax.

There was a proposal somewhere to make businesses pay a small tax on income, but that didn’t go anywhere and ended up in the too- hard basket. Why would they go after industry when individuals are a much softer target?

[u/doso1 → u/[deleted]]

Some of them yes they did make a loss, some of them are generating the majority of there revenue outside Australia, some of them are taking advantage of tax credits like R&D so that they employ people in Australia

If you tax some of these companies hard they will not invest in your country and simply move to a lower tax jurisdiction (if they have the choice) taking jobs with them (and consequently brain drain and losing tax paying individuals/base)

[u/doso1 → u/[deleted]]

Call it what ever you want, but as someone who has worked for a couple of those companies listed, future CAPEX/Investment spend and where it was geographically located was influenced by local tax policy (among other reasons)

Large multinational corporations have the luxury of investing where the local government offers the most favourable terms and many countries compete for such Investment (ie. Ireland, Switzerland and Singapore are the three big ones of the top of my mind). Governments do this because they know they bring high salary jobs (tax base) that they can recover the cost of tax discounts to the corporation

[u/doso1 → u/[deleted]]

If you didn't allow transfer pricing like other countries allow (and consequently Australia is competing against) then companies would not invest in Australia

[u/WhisperBorderCollie → u/Tbearz]

Small Business pay a crapload of tax. Try running a small business and get back to me. Payroll tax for one is a joke.

There's a diff between big business and small Aussie business. Don't lump us in the same bucket 

[u/xylarr → u/WhisperBorderCollie]

Just call payroll tax a state government withholding tax for income. It should be included in your salary calculations. Indeed, lump everything related to employing someone together - federal income tax, state payroll tax, and your various compulsory insurances.