Where government spending is directed (2024–25)
All other functions $83.9b
General public services $32.4b
Social security and welfare $266.7b
Defence $48.0b
Education $53.0b
Health $112.7b
Other purposes $137.8b
21.4.4
Taxes that young people pay
Goods and Services Tax
Young people or full-time secondary school students probably don’t think about paying tax. However, everyone in Australia will pay some tax each year, the most common being the Goods and Services Tax (GST). This is a tax applied to most goods, services and other items sold or consumed in Australia. GST is a regressive tax, because as a proportion of income, it affects lower income earners more. While most food and drink are GST-free, there are some exceptions to this rule, so students in junior and middle secondary school will pay some GST. These items include:
FIGURE5 Most students with a casual or part-time job will not earn enough to pay income tax.
• chewing gum • potato chips • dimsims • doughnuts • energy drinks. GST is also paid by young people when they buy clothes and sporting goods, or go out to places such as the cinema or a bowling alley. Income tax In terms of income tax, most people under the age of 18 won’t pay income tax. All persons earning an income from work are eligible for the tax-free threshold. This is an amount of income a person can earn that does not incur income tax. In 2024–2025 this figure was $18 200. Most secondary school students who have a part-time job will not earn this amount of money in a year and therefore won’t pay income tax.
TOPIC21 Understanding tax and consumer literacy 613
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