How will the carbon tax affect disadvantaged Australians?

Mission Australia recognises the reality of climate change and supports the Australian Government’s efforts to tackle the problem and prepare for the challenges ahead.

In terms of its carbon tax proposals released on Sunday, Mission Australia has a range of perspectives.

Firstly, Mission Australia is strongly supportive of the package’s suggested changes to the tax system.

Lifting the tax-free threshold from $6,001 to $18,201 in 2012 and then $19,401 in 2015, and lifting the marginal tax rates at the lowest level from 15% to 19% and at the next level from 30% to 32% are very significant.

For many years, one of the greatest barriers to people contemplating entering or re-entering the workforce has been a lack of incentive. What’s the incentive in getting off income support when you’re financially worse off simply by working an extra few days?

These changes go a long way to addressing that perversity in how Australia’s taxation and income support systems interact.

For example, under the package, a single mum wanting to return to work part-time would not have to pay tax until she earned more than $20,000 – a result of both the lifting of the tax-free threshold and a further low-income tax offset.

Similarly, a person on a low-income working two days a week could work an extra day without paying any tax on the extra day’s effort.

It’s about improving people’s passage from income support into work and we congratulate the government on these aspects of its proposals.

We also welcome the government's measures regarding compensation, including payments to help low-income individuals and families adjust to the carbon tax.

However, we are concerned that a 1.7% increase in the various pensions and income support will not be sufficient to insulate these vulnerable groups from the impact of the tax as well as the rise in prices expected from the enormous infrastructure maintenance and upgrades that are due for Australia’s power network.

We’re particularly concerned given that those on lower benefits receive the least amount of compensation.

As a result we intend to keep a close eye on its impact among our clients and will report to government if we find that vulnerable groups are worse off.

Similarly, we will also be assessing the impact of the tax on our capacity to deliver our services to those most in need.

For example, as one of the nation’s leading providers of services to job seekers, we’ll be monitoring the impact of the carbon tax on employers – both in terms of jobs lost or created.

Perfect time to support Australians in need

With the financial year ending tomorrow, it’s the perfect time to make a difference in your community and to your tax return through donating.

By giving to our 2011 Winter Appeal you’ll not only support families and individuals who have fallen on hard times, but also maximise your tax return.

In Monday’s Australian Financial Review, Phil Hayes-St Clair, Executive Chairman of HSC and Co, put forward Mission Australia as one of seven charities worthy of an end-of-financial-year donation – namely due to our transparency and effectiveness.

Even a small tax-deductible gift – anything over $2 - can make a huge difference to Australians whose lives have spiralled out of control because of a series of unfortunate incidents and plain bad luck like a job loss, poor health, the death of a loved one or lack of a support network. Sadly, it’s an all too familiar story.

For example when Gracie’s dad, Paul, was made redundant the family fell behind in their rent and the settled life they knew spiralled out of control within weeks.

Gracie and her brother soon found themselves sleeping in the back seat of the family car, with just a plastic bag of clothes and toys to call her own.

We urgently need your help to provide families like Gracie’s with a roof over their heads and the support they need to make a new start.

Donate before 30 June - and your kind gift can also be claimed as a tax deduction this year.

*Names and images have been changed to protect the identities of our clients.

Make a difference to your community… and tax return

With the end of the financial year days away, many Australians are starting to think about the best way to maximise their yearly tax return.

By far one of the best ways to receive a tax deduction is by opening your heart and wallets to others and making a charitable donation.

Any donation you make over $2 to a Deductible Gift Recipient (DGR) such as Mission Australia is tax-deductible – and even a small gift can make a huge difference to someone like Sheree*.

Sheree had been beaten continuously by her husband for the past five years. One night he hit her so hard that she blacked out for a few minutes. But it wasn’t until her children were hospitalised due to his beatings that Sheree realised she had to get away from her husband for good for the sake of her young family.

While he slept one night, Sheree quietly put the children in the back of the car and fled to the care of Mission Australia.

Unfortunately, Sheree’s situation is all too common – she and her girls make up just one of many families we work with every day at Mission Australia. Your generous donation today will help hundreds of Australian women and children in similar desperate situations to find pathways away from poverty, violence and homelessness.

We urgently need your help to provide families like Sheree’s with a roof over their heads and the support they need to start a new life.

Donate before 30 June and your kind gift can also be claimed as a tax deduction this year.

*Names and images have been changed to protect the identities of our clients.