Tax cut call for wealthy talent

A RADICAL tax plan put to the government would see more items slugged with GST to give Australia’s wealthiest a tax cut.

Respected think tank the Tax Institute says the measure is needed to prevent a brain drain of Australia’s top talent to overseas countries that have lower income tax rates for their top earners.

Australia’s highest paid people are taxed 45c for every dollar earned over $180,000. But this should be slashed to more comparable international rates – down to 33-39 per cent, the institute says.

The top tax break should be paid for by broadening the GST base and reviewing tax write-offs and concessions, according to the institute’s prebudget Treasury submission.

Tax Institute president Matthew Pawson said Australia’s top income tax rate of almost 50 per cent was excessive compared to other countries, with the US top personal marginal rate at 39.6 per cent, Canada and New Zealand at 33 per cent while Singapore’s is as low as 22 per cent.

“This is a significant threat to the available talent pool in Australia,” he wrote in the submission.