Perth, July 30: One in five Australians (20 per cent) have avoided asking for a pay rise due to concerns about moving into a higher tax bracket or income threshold, according to new research from Money.com.au.
The nationally representative survey of more than 1,000 Australians found the biggest concern among those who held back was paying more income tax, with half (50 per cent) saying the extra income wouldn’t feel worth the added tax burden. Twenty-three per cent were concerned about higher HECS/HELP repayments, 17 per cent feared losing government concessions or rebates, and 9 per cent worried about losing childcare subsidies or family benefits.
Money.com.au’s Head of Insights, Sean Callery, said the perception that earning more won’t leave workers much better off could be discouraging Australians from seeking higher pay. He explained that moving into a higher tax bracket only means the portion of income above the threshold is taxed at the higher rate, with income below that threshold still taxed at lower rates. Callery added that once factors like higher HECS-HELP repayments and lost family benefits are considered, “some workers start to question whether chasing a higher salary is actually worth it.”
Younger Australians were the most likely to hold back from asking for a pay rise over financial consequences, with around one in three Gen Z (32 per cent) and Millennials (31 per cent) saying they had avoided it, compared with 18 per cent of Gen X and just 11 per cent of Baby Boomers. Gen Z was most concerned about higher HECS-HELP repayments, with 42 per cent citing it as their biggest worry, followed by Millennials at 36 per cent.
Baby Boomers were the generation most concerned about the income tax implications of a pay rise, with 74 per cent citing it as their biggest concern, ahead of Gen X (61 per cent), Millennials (42 per cent) and Gen Z (26 per cent). Baby Boomers were also the most concerned about losing government concessions or rebates (24 per cent), followed by Gen X (21 per cent).
Media & PR: editor@dailystraits.com. Copyright 2021–Present DailyStraits.com. All rights reserved.