26/06/2026
The minimum 30% tax rate means $9,480 more tax for low income earners
Another way of explaining the minimum tax rate is that a taxpayer with no other income than that which is subject to the minimum tax rate ie trust income and capital gains is not entitled to earn their first $18,200 tax free, considered to cover the bare minimum cost of survival. They are also not entitled to only be taxed at 15% between $18,200 and $45,000. With a minimum tax rate of 30% applied to this low income that is an extra $9,480 in tax paid by someone on a very low income. That is nearly $200 per week, the grocery bill now gone in tax. The carve out for low income earners in our tax rates, was intended to ensure people only paid tax when they could afford to. On the other end of the scale a person with income of $227,000 has an average tax rate of 30% anyway so the minimum tax rate makes no difference to the amount of tax they pay. Same for all income above that amount too. Make no mistake this minimum tax rate is a tax on the poor, it makes no difference to the wealthy.
