The Australian Taxpayers' Alliance (ATA) is calling for urgent tax reform to provide meaningful relief to Australian families struggling under the cost-of-living crisis. With only minor relief from bracket creep in recent tax cuts, the ATA is urging both major parties to commit to bold family tax reforms ahead of the next federal election.
ATA Chief Economist Dr. John Humphreys has proposed a suite of family-focused tax policies designed to put more money back into the pockets of working Australians and remove financial disincentives for parents.
"The stage 3 tax cuts took six years to implement, yet only compensated taxpayers for two years of bracket creep," said Dr. Humphreys. "We need another round of tax cuts-particularly for families-to help manage rising costs and make it easier for young Australians to start and support a family."
The ATA's proposed family tax reform package includes:
Joint Family Tax Treatment: Married couples with children could opt for a combined tax-free threshold of $50,000, reducing their tax burden by up to $6,424.
Child Tax Exemption: Parents would receive an increased tax-free threshold of $10,000 per child, saving up to $3,000 per child annually.
Childcare Tax Credit: The existing Childcare Subsidy would be replaced with a refundable tax credit of $1,000 per month per child under school age, giving parents greater flexibility in managing childcare needs.
Family Tax Benefit Reform: The Family Tax Benefit would be streamlined into a simple $6,000 per child welfare supplement, withdrawn at a consistent 30% rate, reducing welfare dependency and poverty traps.
"These policies would give parents real choices and financial freedom," said Dr. Humphreys. "The current system is riddled with complexity and poverty traps, where parents face marginal tax rates of over 90% when attempting to return to work. That needs to change."
ATA President Brian Marlow reinforced the need for urgent action. "Australians are being squeezed from every angle-soaring grocery prices, skyrocketing energy bills, and unaffordable housing. We need real tax reform to ease the burden on families and restore hope for the next generation," said Mr. Marlow. "It's time for both major parties to step up and commit to bold tax relief for families."
The ATA will be releasing further tax reform proposals weekly in the lead-up to the federal election, ensuring tax relief remains a key election issue.
