Why pensioners will be the worst off if there’s a GST increase 334



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We hear about middle and high income earners who are feeling worried about a possible GST increase, but what about the pensioners?

Pensions rarely go up by more than a few dollars twice a year, yet the cost of living, and now potential the GST, could be sending people who are already living below the breadline, further down.

Analysis conducted by Australian Council of Social Service (ACOSS) shows taking GST to 15 per cent would cost the poorest in our society up to 7 per cent of their disposable income. In contrast, those in the highest income bracket would only be 3 per cent worst off.

The ABC reports the Federal Government could raise $130 billion from a 5 per cent increase to our GST within a year.

Ministers have been going through marathon talks about the GST and right now, anything is possible.

ACOSS chief executive Cassandra Goldie told 7.30 last night their research showed any increase to the GST was regressive and would disproportionately impact the budgets of low and middle-income earners, who spend more of the money they do have on just getting by.

“So we estimate if you did increase the GST up to 15 per cent, you’d raise about $30 billion,” Dr Goldie said.

“Now we said what if spent all of that on delivering an across-the-board 5 per cent personal income tax cut.

“There’s no doubt people on low and modest incomes will be definitely be worse off.”

According to Ben Phillips, the principal research fellow at NATSEM, “If you’re looking at, say, compensating the bottom 20 per cent or the bottom 40 per cent and the reality is you’re going to have compensate most of those households because that’s pretty much all of your aged pensioners, all of your unemployed persons,” he said.

“Potentially a third or even up to as much as a half of your GST would go on compensation depending on exactly the form of the GST reform that takes place”.

Tell us, how will an increase to the GST impact on your life? Will you struggle to get by?

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  1. If they go down this track pensions need to rise to compensate so does family allowance. It will be pensioners and families with dependent children that will be hit hard.

  2. do l think its fair, that the elderly, who carried australia, as the young ones do now, are being treated badly for doing the right things. almost makes the younger ones stop making an effort, if this is all they have to look forward to….thats how l feel about it.

  3. This is all a farce. We keep complaining though. We need a pensioners delegation to go to the government!!!!

    11 REPLY
    • Nearly all those over 65 that we know vote Liberal. I find it incredible but when I vocalise this I am told it is because Labour get us in to much debt! It is the same story every time so I think it is a mind set. Very sad.

    • Particularly when LNP are worse economic managers than Labor! I don’t understand why people refuse to look at facts and are happy to be brainwashed. It drives me crazy.

    • Muriel, the current government has doubled that debt. Is it OK if a LNP government does it, but not OK if Labor does it?

    • When Kevin Rudd gave put his one of payment to most of us, did anyone hand it back? And as far as the GST goes, it is the pensioner who has only the pension to survive on who will find it even harder

    • I livein south aust I’am a pensioner Ivoted LNP but it was the Labour party in sa that took all our concessions away and blamed the Federal govt but it did’nt in any other state .So next election I don’t know losing interest in the whole lot like they have in pensioners

  4. All I can say is put the bloody Politicians on the same money as a pensioner for a year and see how they like it, Without their lurks and perks.

    5 REPLY
  5. I suggest that more people on this site voted for this government than voted against it. I don’t understand why, but I would really like those who are not independently wealthy to think about their vote more seriously next time.

    5 REPLY
    • So try an independent or minor party if you don’t like the opposition. If you vote for a party you are endorsing their policies. Why would they change?

    • Yes, we saved like crazy, on one income, for our old age, and had many many set backs along the way, If I could manage it many others could have too.. When husband was sick for months , sick pay gone his work mates took up a collection each fortnight , as I had young children & could only work a few hours . We had enough saved with small pension to live comfortably, I am 75, been on part pension since I was 60, my Mum died last year and I did get my share which did help, It seems that no one on here ever had parents who left them some money

    • Dawn Bruce .. …many many people have struggled and worked hard all their life,and saved and done without…..and find themselves through no fault of their own,not on the wealthy side of life…..These peole are not asking to be rich ..far from it….it is about the government,which has a duty of care to its people,to ensure there is balance and fairness……something this government is incapable of….It is about looking after the rich….if they were doing their job,we would NOT have the biggest gap between the rich and the poor in 20 years,and increasing…..when was the last discussion by this government on how to help the poor and vulnerable….their reply..cut funding,cut back on increase to pensions….always hitting the lower socio…economic groups……good leadership never does that….and that is the Liberals….the most entitled party ever!!!!!

  6. In NZ we already pay 15% GST … and it is galling to see the amount shown as GST every time I shop … and mostly my shopping is for groceries … after paying for utilities such as power … I haven’t purchased any new clothes since I don’t know when.

    1 REPLY
    • And the thing is Christine, once they are used to 15% they will move the goal posts again…and again. They were fools in the first place to listen to a NZ politician pushing them to have GST!! They should have asked the NZ public what they thought and then they would have got an honest reply! WE HATE GST

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