Australians Might Pay a Lot of Tax… But They Get a Lot in Return

No one likes to pay taxes. We work hard for our money, and naturally, we want to keep as much of it as possible. The same can be said anywhere, whether we’re talking about people in Australia, Germany, France, the United States or almost any other nation on Earth.

According to a recent Gallup poll, 57 percent of Americans think they’re paying too much federal income tax. Another survey from Per Capita found that only 45 percent of Australians felt that way about their taxes.

Ironically, even though Australia charges more taxes than the United States, it appears that Australians are happier with the outcome than Americans. The reason for this can be attributed to the numerous benefits that the Australian tax system provides to the people of Oz.

In December 2015, the United Nations released a report on its findings after assessing which countries in the world offered the best quality of life for their people. The study assessed things like average life expectancy, economic growth, and education.

Based on these assessments, Australia ranked second place for best quality of life, coming in just behind Norway.

The reason? It is because the Australians have a tax system that provides a plethora of benefits which enhance the quality of life for everyone.

Architecture of Aussie Tax System

There is a minimum of 125 various taxes annually charged to Australians. The Australian government levies approximately 99 of these taxes, 67 of them relating to agriculture.

The states in the country levy another 25 taxes upon their citizens, and, of course, the local governments have their council tax rates to impose, too.

These are only estimates of the number of taxes levied. Sometimes there are separate service fees that are all related to one bigger tax.

The Australian Tax Office, also known as ATO, is responsible for collecting federal taxes. Both businesses and individuals in Australia are expected to pay taxes.

The three main business taxes include the company tax, GST (goods and services tax), and CGT (capital gains tax). Payroll tax and other state taxes may also apply.

As for individuals, their employers deduct personal income taxes out of each of their paycheques. The employers will then send these tax payments directly to the ATO.

Employees certainly don’t like to see these deductions from their paycheques, but at least they aren’t responsible for handling the tax payments themselves.

Also, employees may be entitled to a tax refund if their employers deducted too many taxes out of their paycheques throughout the year.

Quality of Life

When you think about how much better the quality of life is in Australia, it doesn’t seem so bad to pay all these taxes. For starters, taxes pay for single-payer healthcare benefits, which leads to a longer life expectancy.

Taxes also fund parental leave and contribute to lowering student debt throughout the nation. Let’s examine a few of these benefits more closely:

  • Life Expectancy – The average Australian lives to be about 82 years old. In America, the average life expectancy is 78 years old.
  • Health Care – Australia has one of the best healthcare systems in the world. It is a single-payer system, where the government finances people’s healthcare needs.

Despite what Americans think about the expense of single-payer, the Australian government does not pay nearly as much to cover their citizens as Americans pay to cover themselves.

  • Parental Leave – Australia is one of the few countries to offer paternal leave benefit so that fathers can take paid time off from work to be with their newborn children and care for them.
  • Student Debt – When Australian students graduate from college, they are not forced to repay their student loans until they’ve secured a job that pays at least $39,512.

Once they do, the government deducts just 4 percent of their earnings from each paycheque to repay the loan.

  • Other Benefits – Unemployment benefits are also available to Australians who qualify.

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