Tax Refund Scheme
In July, the government of Australia concocted a $1080 Tax Refund Scheme.
- The maximum offset of $1080 will be available to taxpayers with taxable incomes of between $48,000 and $90,000. The offset is calculated on each person’s individual income not household income.
- Those who earned less than $37,000 will get $255 back. This gradually increases to $1080 for those earning $48,000.
- Anyone earning between $90,000 and $126,000 will get lower amounts. Those earning over $126,000 won’t receive any refund.
Bloomberg reports Australian Consumer Confidence Sinks Despite Cash Handouts
Australian households were gloomier this month as worrying headlines from abroad and weakness at home left them pessimistic about their prospects, regardless of government cash handouts.
Consumer confidence dropped 1.7% to 98.2 in September, with a reading below 100 signaling pessimists outnumber optimists, Westpac Banking Corp.’s survey showed. The poll of 1,200 adults conducted during the first week of the month contained a special question on recent household tax rebates, and found over half planned to save part or all of the cash.
“Pressure on family finances and concerns about the near-term outlook weighed on sentiment,” Westpac chief economist Bill Evans said Wednesday. “Concerns about the state of the economy, the international backdrop and employment are seeing consumers become more cautious.”
The result comes a day after a survey of Australian firms found sentiment poor there as well despite back-to-back interest-rate cuts and the government tax rebates. Australia’s economy has slowed sharply as households start to buckle under record debt and weak wage growth, and opt against spending.
How Does "Cash Back" Work?
- Government collects a massive amount of your money in taxes, then wastes most of it. Some might prefer the word "steals" to "collects".
- Government returns a tiny piece of your money provided it believes you do not make too much money.
Cash Back Question of the Day
Is it any wonder this scheme failed to inspire confidence?
Mike "Mish" Shedlock