Sixty-two Australians who earned more than $1m in 2015-16 financial year paid no tax • Sign up to receive the top stories in Australia every day at noon

Number of Australians who earned more than $1m a year yet paid no tax surges 30%

Sixty-two Australians who earned more than $1m in the 2015-16 financial year paid no income tax. That represents a 30% increase from the previous financial year.

New data from the Australian Tax Office, released on Friday afternoon, shows that despite a political focus on wage stagnation and income inequality in recent years, the ranks of Australia’s millionaires paying no income tax is growing swiftly.

The data shows Australia has 12,706 taxpayers earning more than $1m, the vast majority of whom have paid some sort of tax on their taxable income.

But in the 2015-16 financial year, 59 millionaires claimed to have taxable income below $6,001, one claimed to have taxable income between $6,001 and $10,000, and two claimed to have taxable income between $10,001 and $18,200, putting them all below the tax-free threshold.

None of them paid the Medicare levy.

Twenty-two reduced their taxable income to zero by claiming a combined $4.34m for the “cost of managing tax affairs” – nearly $198,000 each.

Fourteen claimed gifts or donations worth $54.9m to help them do so.

A tax office spokesman said there were legitimate reasons why a wealthy taxpayer may not pay tax in a particular year, including prior year tax losses (which are able to be carried forward indefinitely), large costs associated with the production of assessable income (such as the start-up phase of a business), and the cost of managing tax affairs.

The “cost of managing tax affairs” includes the cost of getting advice from a registered tax agent, barrister or solicitor, the cost of preparing and lodging tax returns and activity statements, and the cost of court appeals.

“Notwithstanding this, a wealthy taxpayer who does not pay tax is more likely to attract the ATO’s attention and be subject to further scrutiny to assure they are complying with their tax obligations,” the spokesman said.

The data show in the 2013-14 financial year there were 56 millionaires who paid no income tax, which decreased slightly to 48 millionaires in 2014-15, but it has jumped up to 62 millionaires in 2015-16.

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Sally McManus, the secretary of the Australian Council of Trade Unions, has criticised the news, saying it highlights again why tax rules have to be changed.

“The fact that more than 60 millionaires paid no tax is obscene,” she said in a statement.

“Our schools and hospitals are suffering because companies and individuals at the big end of town are getting away with paying no tax.”

The ATO stats also show the number of landlords with an interest in six or more rental properties has grown quickly in the last four years, up 13%, from 17,671 to 19,967 individuals.

This group of investors is growing at three times the rate of those who own just one investment property.



The shadow treasurer, Chris Bowen, said the data proved Labor’s point that the federal government’s generous property tax breaks were skewed towards a small number of Australians.



“The new data from the tax office again draws out the problems with the current tax concessions on housing – an investor buying their fifth, sixth or seventh property gets more assistance than a first home buyer trying to get into the market,” Bowen said.



First-home buyers needed to be on a level-playing field with investors, and money provided for negative gearing of multiple properties could be put to better use, he said.

The ATO figures also show more millennials filed tax returns than baby boomers in 2015-16, as the composition of Australia’s population continues to evolve.

The ATO says if the 13.5 million people who filed tax returns were represented as 100 people, the ATO received 18 tax returns from generation Z, 26 from millennials, 27 from generation X, 23 from baby boomers, and six from the generation before that.

Using the same formulation of 100 people, it said after tax returns were assessed 77 people received a refund, 16 people owed tax, and seven balanced perfectly.

With Australian Associated Press