Social Justice Australia

Welfare Costs vs.Tax Concessions: The Facts

Welfare costs to the wealthy exposed.


Explore how Australia’s tax concessions to the wealthy exceed welfare costs, according to new HILDA survey data.


Recent findings from the University of Melbourne’s Household, Income and Labour Dynamics in Australia (HILDA) survey have revealed a startling disparity: government tax concessions to the wealthy far outweigh expenditures on critical welfare programs like Newstart, the age pension, and disability payments.

HILDA Survey Overview:

The HILDA survey, a critical household-based panel study, annually collects detailed data on the personal and economic well-being of Australians. This comprehensive survey offers unique insights into labour market dynamics, family life, and the evolving patterns of household income. By tracking the same individuals and households over time, HILDA provides policymakers with robust, longitudinal data, enabling informed decisions across diverse policy areas.

Key Findings About Welfare Costs:

The latest research indicates that major tax concessions, primarily benefiting Australia’s affluent citizens, cost taxpayers approximately $135 billion a year. This staggering sum of welfare costs significantly exceeds the total funding allocated to welfare programs such as Newstart (now known as Jobseeker Payment), the age pension, family assistance payments, and disability supports, which are crucial for the nation’s most vulnerable populations.

Comparative Analysis:

– Tax Concessions: These include deductions, exemptions, offsets, and preferential tax rates that disproportionately benefit the higher income brackets, effectively reducing their taxable income and hence, their tax liabilities.

– Welfare Programs: These programs are designed to provide support to various societal groups needing assistance:
– Jobseeker Payment: Supports individuals aged 22 to pension age who are actively seeking employment or unable to work due to illness or injury.
– Age Pension: Offers income support to older Australians who meet specific age and income criteria, ensuring they can maintain a basic standard of living in retirement.
– Family Assistance: Comprises payments like the Family Tax Benefit (FTB) and Childcare Subsidy (CCS), which help families manage the cost of raising children.
– Disability Support: Encompasses the Disability Support Pension (DSP) and the National Disability Insurance Scheme (NDIS), providing financial aid to individuals living with a disability.

In-Depth Discussion on Tax System Equity and Welfare Costs:

The substantial difference in funding between tax concessions and welfare costs raises significant questions about the fairness and equity of Australia’s tax system. While the intention behind tax concessions might be to stimulate investment and economic activity, there is an ongoing debate about their effectiveness and the fairness in how they are distributed among different income groups.

Policy Implications:

These findings suggest an urgent need for a critical review and possible reform of our tax policies to address these inequities. Reforming tax concessions could potentially free up significant funds that could be redirected towards enhancing welfare programs, thereby supporting a broader segment of the population and promoting greater social justice.

Expert Opinions:

Economists and policy analysts have weighed in, suggesting that the reduction or realignment of tax concessions could serve as a more equitable source of funding for welfare programs. This could not only help balance the fiscal budget but also ensure a more just distribution of resources, supporting social cohesion and economic stability.

Historical Context:

The evolution of Australia’s tax and welfare policies over the past decades has led to the current disparities, making it crucial to reassess and realign these policies with contemporary societal needs and values.

Question for Readers:

What are your thoughts on this issue? Do you believe that Australia’s tax system requires reform to more equitably distribute resources?

Call to Action:

Raise your voice and demand change. Contact your local representatives today to express your views on this critical matter. Together, we can advocate for a fairer Australia.

Engage with Us:

Please share your opinions in the comments below and share this article on social media to spread the word about the need for tax system reform in Australia!


Report shows the scale of government handouts to the rich:
Newstart cost Australia:
Payment and Service Finder:
Newstart Allowance:
How much you can get:
Your family income estimate:
Payment rates:
HILDA Statistical Report:
Warning on Struggle Street:
Dept. of Social Services:
Guides to Social Policy Law:
Welfare – what does it cost:
September 2023 Age Pension payment rates revealed:
Your family income estimate for family assistance payments:
Disability and Carers: Benefits & Payments: To increase the SEO score of the article Tax Concessions vs. 

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