Men capture more than two-thirds of the benefit of four tax concessions that cost the federal budget a total of $60bn a year, according to new research by The Australia Institute.
A report by the progressive thinktank, released on Monday, found that the tax treatment of superannuation in particular is turbo-charging wealth inequality in favour of men.
Men receive 71.6% of the $41.2bn given each year through superannuation tax concessions compared with 28.4% for women, meaning for every dollar of super tax concession going to women, men get $2.52.
Similarly, men received more than 70% of the $4.3bn a year benefit of negative gearing tax deductions and of the $5.2bn in franking credit refunds.
The $9.4bn a year given in capital gains tax discounts was slightly more evenly distributed, with 60.6% flowing to men and 39.4% to women.
The analysis comes as the Morrison government attempts to reconsider the gendered impact of its policies, dumping a controversial bid to allow domestic violence victims early access to superannuation and appointing Jane Hume minister for women’s economic security.
The November budget copped criticism for its small investment in women’s economic security and the issue has become more critical to the government as it struggles to contain the fallout over its management of allegations of sexual assault and harassment.
The Australia Institute report, based on Centre for Social Research and Methods modelling, found that men pay about two-thirds of all income tax, compared with one-third by women.
“This is because men earn more income and have on average a higher income than women,” the report by senior economist Matt Grudnoff and researcher Eliza Littleton said.
“But even accounting for this, men get an oversized benefit from these tax concessions.”
“That is, they pay 65% of the tax but get 70% of the concessions. For women, it is the opposite: they pay 35% of the tax but only receive 30% of the concessions.”
The report argued it was “counterintuitive” to give greater super tax concessions to men because women on average have less super at retirement.
“A well-thought-through retirement incomes policy would give larger concession to those who were less likely to be able to fund their own retirement,” it argued.
The report also found that the four tax concessions help the rich get richer, with about 39% of the benefit flowing to the top 10% of income earners, or 41% to the top 10% of wealth owners.
It found the top 20% of households by income received 64% of the benefit of franking credit rebates but the top 20% of households by wealth received 83%.
That gap points to a high-wealth middle-income cohort of retirees who benefit from these rebates. At the 2019 election, Scott Morrison was re-elected in part due to backlash at Labor’s attempts to trim the franking credit concession.
The Australia Institute report concluded that the four tax concessions are contributing to economic and gender inequality.
Scrapping or curtailing the tax concessions would reduce inequality and raise billions to spend on further programs including childcare, crisis accommodation, and boosting retirement incomes for those in poverty, it said.
Anthony Albanese has confirmed Labor will not end cash rebates for excess franking credits but has remained tight-lipped about negative gearing and capital gains tax reform.
Superannuation is a hot political topic as Labor pressures the government to recommit to increase compulsory retirement savings from 9.5% to 12%, but neither party has proposed a fresh attempt to reduce tax concessional treatment of super.
The Coalition trimmed back superannuation tax concessions in 2016 when Scott Morrison was treasurer, but was forced to ditch its proposed lifetime non-concessional contributions cap of $500,000 to pass the reform after fierce internal backlash.
Instead, Australians are now allowed to make annual non-concessional contributions worth up to $100,000 a year until their super balance reaches $1.6m.
