Do you think you're paying way too much tax?
Well, according to new research by Finder, millions of Australians think too much of their salary goes towards paying taxes.
The survey with 1,004 respondents revealed almost 2 in 3 (64%) Australians – equivalent to almost 13 million people – believe they pay too much money in taxes each financial year.
The data also showed that Millennials (80%) are more likely than all of the other generations to say they pay too much tax, followed by Gen X (72%).
This is compared to Gen Z (63%) and baby boomers (39%).
Sarah Megginson, personal finance expert at Finder, said the cost of living has wreaked havoc on our personal finances.
She explained further:
“Budgets are stretched thin, with many struggling to make ends meet.
While inflation is trending downwards, the financial burden remains heavy for a significant portion of Australians.”
Fortunately, Starting July 1, the government is set to provide tax cuts, offering a welcomed alleviation to the cost of living.
Nearly a quarter of individuals (23%) currently express feeling pessimistic or distressed about their financial future.
In a recent analysis, Finder found that Australians earning between $45,000 and $135,000 annually can anticipate an additional tax cut of $804.
This is in addition to the previously announced reductions, resulting in a substantial monthly improvement in their financial situation.
For instance, those earning the median Australian income of $83,200 will experience a noteworthy boost, receiving a $1,759 tax cut over the span of 12 months – nearly double the initial $955 cut.
Moreover, individuals with an annual income exceeding $200,000 will benefit from approximately $4,529 through the new stage 3 tax cuts, a significant adjustment compared to the previous stage 3 tax cuts, which stood at $9,075.
This positive development underscores the government's commitment to providing meaningful financial relief to Australians.
Megginson said the cash injection will provide some welcome relief from cost of living pressures.
She further noted:
“Those struggling with everyday costs will see more money back in their pocket to help battle expenses.
If your budget allows, stashing some of this extra cash is a wise move.
Every bit helps build a buffer for those unexpected rainy days.
You can also potentially save thousands by switching some of the services you pay for anyway.
If saving isn’t an option, use the extra money to pay down debt and bills, to alleviate some financial pressure.
How to take control of your finances:
Create a list
Create a list of ALL your subscriptions: music, TV, fitness apps, sports, gaming, the lot.
Note the name and the cost every month.
Make sure you check current prices on your credit card statements or platform websites, so your info is accurate.
Review each service, one by one
This is a tiny bit tedious, but it's nowhere near as time-consuming as you think it's going to be.
Log in to every subscription you have so you can make a decision.
Ask yourself questions like ‘Do I really need this?’
Capture the savings
The final piece of the puzzle is to note the savings and decide what to do with that money.
If you're struggling with the rising cost of living, you could squirrel these savings towards other bills.
Otherwise, this money could be added to your savings balance.
