Thursday, March 25, 2010

It's the Tax Stats - love them, get lost in them, have fun.

I do.

Cash payments of up to $900 appear to have succeeded where years of pleading and threats have not.

They have persuaded Australians to do their tax.

The latest tax statistics show a record 12.6 million individuals filled in returns for the 2007-08 financial year, up 7 per cent or 840,000 on the year before. In no previous year has growth approached 300,000.

Worth between $250 and $900, the tax bonus stimulus payment was available only to Australians who completed their tax returns by February 2009 and earned up to $100,000.

But Australians in the very richest of families do not seem to have been shy about claiming it.

Australia's highest-earning postcode is 2027, taking in Edgecliff, Rushcutters Bay and Point Piper, with an average taxable income of $186,000... Yet about 3000 of its 5000 taxpayers claimed the rebate, according to the Tax Office. They were matched by the second-highest earners in the state, in Mosman and Spit Junction, who took home an average of $156,000 each yet claimed two rebates for every three taxpayers.

Net incomes fell in all but two of the top 10 earning NSW postcodes, largely reflecting a massive 29.5 per cent slide in capital gains.

''The economy was moving towards what we know now was the global financial crisis,'' said the assistant Treasurer, Nick Sherry. ''That was followed by a massive $170 billion in revenue being ripped from the budget by the worst global recession in 70 years.''

Australians continued their rush into the property market, with an extra 113,000 signing up as landlords in 2007-08 and bringing the number of rental property owners to a record 1.7 million - more than one in seven taxpayers.

Spurred on by the prospect of negative gearing, they lost a net $8.6 billion on managing properties - the previous year's loss was $6.4 billion.

Deductions for work-related expenses jumped 13 per cent, the number of claims rose 8 per cent and the size of each claim grew 5 per cent.

An extra 150,000 Australians volunteered to pay the Medicare levy surcharge rather than join a private health fund and the number claiming the private health insurance rebate remained fairly stable, slipping by 4000.

Australians showed more generosity as the financial crisis loomed, claiming $2.3 billion in donations to charities, an increase of 24 per cent.

They showed less inclination to use tax agents - the number lodging electronically climbed to a record 2.2 million or 18 per cent.

The Henry tax review, due for release shortly, recommends measures to encourage an even greater shift to electronic lodgment. It will make simple returns effectively optional, requiring no more than a computer click for taxpayers prepared to accept the Tax Office's view of what they owe.

The Treasury head, Ken Henry, said that Australia had the highest rate of agent use in the developed world.

Published in today's SMH and Age

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