Single mum to be worse off with stage three bracket creep

If single mother Melanie Anson receives a small pay increase over the next few years, she will join 1.2 million Australian workers who will be worse off due to bracket creep under stage three.

Melanie Anson, single mum, photographed in Bowral town centre, an hour and a half South of Sydney. Picture: Britta Campion / The Australian

If single mother Melanie Anson receives a small pay increase over the next few years, she will be launched into a new tax bracket, alongside 1.2 million Australian workers who will be worse off over the next decade due to bracket creep under stage three.

Analysis by The Weekend Australian puts the total number of worse-off Australians at three million,after the Albanese government broke its election promise and revised the stage three tax cuts.

Melanie, who works in HR at an aged-care facility, said she was worried that a $6500 pay rise over the next five years, on her $140,000 salary, will land her in a new tax bracket and at a disadvantage.

“With my next salary rise, my income could push me over the edge into a new tax bracket and I could be worse off,” she said. “Being a single mother and not having the option of having another income … It is what it is for me. Unless I can go and earn more in another job, I don’t have an option, or I get a second job, but I don’t know when I would do that. It leaves you a bit stuck.”

She says it’s hard to get ahead these days and the tax reforms could be the next big blow. “That’ll be the next whammy. It’s almost like you’re constantly trying to get ahead but you can’t,” she said. “You get a new job and earn more money, but then there’s these rate hikes, and your apartment strata fees and levies go up for whole lot of reasons. I’m 55. I’ll be working till I’m 95.”

Melanie, of Mittagong, south of Sydney, says as a single mother on a relatively good income, she doesn’t feel wealthy. “You’d think $140,000 would be a good income, but I’ve been slagged with all these interest rate rises and the increased cost of living,” she said. While she doesn’t pay school fees, she does have a mortgage and a car loan.

“It’s a real struggle at the moment. I think that we’re blessed compared to a lot of people. But even for me, when I bought my apartment in Mittagong it was manageable but now rate hike after rate hike, it’s getting harder.”