Labor and Greens Oppose Tax Relief, Why?

Labor the the Greens have united to oppose a tax cut designed to provide relief to families because they claim it is sexist...

Seemingly left with no economic arguments, Labor and Greens have joined forces against the Government’s income tax relief package on new grounds — the woman card.

Just when you thought that the social justice brigade’s gender wars couldn’t get any more shameless, Labor’s Chris Bowen and Greens Senator Sarah Hanson-Young now claim that the problem with the coalition government’s plan to provide tax cuts across the board, primarily to middle-income earners, isn’t that it doesn’t do enough to resolve one of the highest tax burdens in the OECD, it is that the tax cuts benefit more men than women.

The sad irony of these attacks lies in their implication. If more men than women benefit from tax cuts that kick in based on your income, it means that men earn more on average than women. This in turn can only mean that men pay more tax than women, something which is exacerbated under a progressive income tax system like ours.

That’s right, there is a “gender tax gap” in this country; men shoulder disproportionately more of the tax burden than women! What should the government do to resolve this inequality? Tax women more? For some reason, social justice warriors concerned about disparity seem eerily silent on this issue. What about the fact that a female lawyer is taxed more than a male bricklayer? Why is that the case? Racism against bricks, I presume.

On a more serious note, lets consider why the “gender tax gap” exists. For one, disproportionately more women choose lesser-paying careers including childcare, hair dressing or nursing. By Chris Bowen’s own admission: “Women earn less. Women are in overwhelmingly lower paid occupations, and they have career breaks because they’re bringing up children.”

Wanting to prioritise children also means that women are more likely than men to choose to take time off work or switch to part-time or fewer hours. It is arguable that these choices, voluntarily entered into, are not actually a problem and should be respected. Is a woman who enters the lesser paid childcare or teaching profession somehow inferior to a man who chooses the investment banking profession simply because he stands to earn more? While the latter career comes with a bigger pay-cheque, the former careers ultimately shape and mould future generations within our society. To state the bleeding obvious, the salary disparity between various vocations stems from supply and demand for the occupations, not from supply and demand that workers be a particular gender. Similarly, should women, or men for that matter, who choose to spend time with their families and children by letting their job or career take a back seat, be shamed by the implication that they are lesser for giving up the chance to earn more money?

Ultimately, society can respect choice while also addressing the “gender tax gap” and empowering women to join the workforce and build their careers. This can be achieved through measures that create options and broaden choice — promoting the best of both worlds, career and a chance to have a family. High childcare costs in Australia are one reason women feel obligated to take time off work. The Australian Childcare Alliance recently made a submission to the Senate red tape committee outlining regulatory barriers which drive up costs and can be reformed or repealed to make childcare more affordable for Australian families.

Unfortunately, the use of the “gender tax gap” as a cheap attempt to score political points against the government’s tax relief package, sidesteps these issues and meaningful policy discussion around them. Tax cuts benefit society as a whole and that includes women. If a tax cut benefits men on a certain income bracket, it benefits women on the same tax bracket equally.

Tax cuts give workers and families, especially those who currently pay well over their fair share, more disposable income by letting them keep more of what they earn rather than giving them a “handout”. Women benefit from keeping more of their own money and will have more opportunities to work as cuts to income and company tax have positive effects on the economic growth rate.

Labor and the Greens should stop shamefully using women as political pawns and support tax relief for everyone while engaging in a more meaningful discussion about how we can support women in our workforce.


Sarah Ray is a Research Associate at the Australian Taxpayers' Alliance

[This article first appeared in The Daily Telegraph]

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