The Per Capita Tax Survey 2020

September 15, 2020

Progressive Economics

Executive Summary

The tenth annual Per Capita Tax Survey provides an unparalleled insight into the views held by Australians of all ages, from across the country, about the role of tax and public services in our national life. For the first time, we have conducted two surveys in 2020 – one in February, immediately before the effects of COVID-19 were widely felt, and a second six months later, in August, when the impact of the pandemic on our society and economy was beginning to be understood.

The results are striking. In the wake of the biggest health and economic crisis in a century, Australians apparently have a renewed appreciation of the essential services provided through our system of government: scores for the value, accessibility, quality and usefulness of public services all showing notable increases between February and August. A greater number of Australians also appear to be more comfortable with the level of government spending on services now than they were prior to COVID-19.

Public approval of the use of government debt to underpin long-term investment is also significantly higher compared to previous surveys, with a remarkable 15 point increase in support over the six months since the pandemic hit. And despite the record outlays of recent months, a majority of respondents still want to see governments spend more on health, education and social security.

Australians also seem to be more comfortable with the levels of tax they pay, with the proportion of those complaining they pay too much dropping by around 5 points, and a commensurate increase in the percentage who feel their contribution is about right.

As in previous years, though, a significant majority of respondents believe that big business doesn’t pay its fair share of tax, and that corporate tax avoidance affects the fairness of Australia’s taxation system. Most survey participants also believe that high income earners should pay more tax.

Some of the most interesting findings this year relate to changed attitudes to current policy debates between February and August.

Support for a significant, permanent increase in the rate of JobSeeker (previously known as Newstart) is significantly higher than it was pre-pandemic, and enjoys majority support among voters of all persuasions, with almost 6 in 10 of Coalition voters, and 7 in 10 of those who vote for Labor or the Greens supporting a long-term lift in the rate of at least $75 per week.

The level of support for the government’s Stage 3 tax cuts, however, is weak, with only 13% of respondent supporting the current distribution of the tax cuts, which overwhelmingly favours high income earners.

By August, support for those tax cuts for high income earners, even if bigger tax cuts were given to those lower down the income scale, was down to 29.9% while the proportion who said the Stage 3 cuts should be reduced or stopped was 46.4%. This issue is divided along party lines, with over a third of Coalition voters in support, compared to just over a quarter of Greens voters and only one in five of those who vote for the ALP.

The Per Capita Tax Survey 2020 lays bare the views of Australians during the most significant social and economic disruption in living memory. It provides valuable insights to policy makers for the months ahead.