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The 60 millionaires who paid no tax and the richest and poorest postcodes revealed

Sixty people earned more than $1 million yet paid no tax in 2019-20, Australia’s highest earners live in Perth, and the country’s lowest incomes have been recorded in regional New South Wales.

The Australian Taxation Office’s (ATO) latest taxation statistics are based on the tax returns of almost 15 million Australians for 2019-20.

Analysis of the data by the Australia Institute reveals there were 60 Australians who earned more than $1 million in that financial year who did not pay a cent of income tax, compared to 66 the year before.

On average these 60 individuals earned $3.5 million each.

Managing your tax affairs is an allowable tax deduction. Some of those who earned more than a million dollars but paid no tax claimed this deduction.

“Some people earning a million dollars or more paid on average $80,000 each to manage their tax affairs, which reduced their taxable income below the tax-free threshold,” Australia Institute senior economist Matt Grudnoff said.

Headshot of Matt Grundoff.
Matt Grudnoff says Australia’s tax system is full of complexity and loopholes.

Another allowable deduction is litigation costs for managing your tax affairs.

Of those earning a million dollars but paying no tax who claimed this deduction, the average amount claimed was $250,000.

“Our taxation system is full of complexity and the latest tax statistics show that some people on very large incomes are able to pay very smart people very large sums of money to take advantage of that complexity to reduce the amount of tax they have to pay, Mr Grudnoff said.

“This highlights the need in Australia for a Buffett rule, which sets a minimum rate of tax based on people’s gross income. This would prevent high-income earners from using lots of deductions to avoid paying tax.”

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