To give younger Australians a fair go, governments need to wind back age-based tax breaks for ‘comfortably off’ older Australians.
That’s according to the Grattan Institute’s new report.
It revealed that older Australians today spend more and have higher incomes and greater wealth than older Australians three decades ago.
Meanwhile, today’s young Australians are in danger of being the first generation in memory to have lower living standards than their parents’ generation.
Report authors Danielle Wood and Kate Griffiths said: “Poorer young Australians have less wealth than their predecessors and are far less likely to own a home.
“In contrast, older households’ wealth has grown by more than 50 per cent over the same period because of the housing boom and growth in superannuation assets.”
The authors listed the ageing population among the financial strains the younger generation is likely to face. They pointed to figures that show the number of 15-64 year-old Australians for every person aged 65 or older fell from 7.4 in the mid-1970s to 4.4 in 2014–15 and is projected to fall further to 3.2 in 2054–55.
The pair added that governments have “supercharged these demographic pressures by introducing generous tax concessions for older people”.
“The share of households over 65 paying tax has halved over the past two decades,” they said. “And older households pay substantially less tax on the same income as younger households.
“Working-age Australians are underwriting the living standards of older Australians to a much greater extent than the Baby Boomers did for their forebears, straining the ‘generational bargain’ to breaking point.”Do you have an idea for a story?
Email [email protected]