Should rural Australians pay less tax? Remote voters want the idea on the federal election agenda

Australia Broadcast Center

24-04-2025

The major parties are eagerly pulling tax levers as they look to win over voters on cost of living and housing, but Australians living in the bush say they have been overlooked this election.
Residents of specified regional and remote communities in every Australian state and territory — except Victoria and the ACT — are eligible for a rebate of up to $1,173 at tax time, a measure introduced in 1945 as a balm for the higher costs encountered living in remote parts of the country.
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It has been more than 30 years since the fixed rebate amounts were last updated and outback Queensland resident Nicole Crawford believed it was overdue for reform.
Nicole Crawford believes zonal rebates are due for an update.
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ABC North West Qld: Meghan Dansie
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"If there is some kind of extra tax incentive to keep people here, in these rural areas, that would be a great idea," she said.
The 35-year-old healthcare worker and mother of one said ensuring remote Australians could cope with costs such as $1,200 return airfares to the nearest capital city, $3 per litre petrol costs, and electricity bills in the thousands had largely become the responsibility of employers.
She said it had created a divide between those with generous employment packages and those without.
"It's very dependent on your work situation and the kind of job you're in, the kind of incentives that brought you out here, which does differ between industries,"
she said.
A 'moral argument' to pay less tax in the regions
Mr Dutton has said he is "happy to have a look" at whether people in regions should pay less tax.
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ABC News: Emily Dobson
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Prior to the election campaign and during a visit to Mount Isa in north-west Queensland last August, Coalition leader Peter Dutton said there was a "moral argument" for regional Australians to pay less tax than city residents.
"I think there are arguments for people who live in regional towns where you're paying more for petrol, you're paying more for electricity, you're paying more for housing. There's an additional cost that comes with it," he said.
"We're happy to have a look at taxation arrangements."
The Coalition has not brought that policy to the election.
Prime Minister Albanese at a press conference in Mount Isa prior to the election.
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ABC North West Qld: Maddie Nixon
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Prime Minister Anthony Albanese disregarded Mr Dutton's comments as a "thought bubble" while on his own visit to the outback mining town in January.
"I think the idea of zonal taxation isn't something that certainly has ever been on our agenda because of the distortions and manipulations that could occur,"
he said.
Both Labor and Coalition spokespeople declined to comment further.
Push to increase rebates by thousands
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A zonal tax offset essentially means a person will pay less at tax time, depending on their postcode and their dependents.
Locals in designated special areas like Norfolk Island, off the coast of Australia, are eligible for the highest fixed rebate. Zone A residents in locations such as Darwin and Broome can offset $338 at tax time, and Australians in Zone B locations like Broken Hill can offset $57 if they reside there for more than 183 days a year.
Belinda Balch, 54, spent many years living in rural inland Australia, but now resides in South-East Queensland.
Ms Balch said living on the coast had strengthened her belief that the existing rebates should be adjusted for inflation.
Belinda Balch said her concern was with her employees' high cost of living.
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Supplied: Belinda Balch
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"It should be increased to at least $5,000 a year — enough to allow remote residents to travel for just one major experience," she said.
"It's not simply a matter of moving — regional and remote communities are essential to sustaining the standard of living in urban centres.
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People should not be disadvantaged for living remotely.
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Many remote Australian towns like Mount Isa struggle to hold on to workers.
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ABC North West Qld: Meghan Dansie
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The existing tax concessions exist despite the Constitution setting down that taxes collected by the federal government cannot "discriminate between states or parts of states", a potential contradiction that has never been challenged.
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A 2020 Productivity Commission report found remote area tax concessions and payments were "outdated, inequitable, and poorly designed" and should be limited to only very "very remote" locations, with half of the claimants living in Cairns, Darwin, and Townsville, which have developed significantly
In a statement from 2020, the Morrison government said it would not act on the recommendations because of the "significant disruption" they would cause during the COVID-19 pandemic and bushfire recovery period.
Minor tax reform on the election menu?
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Both major parties have been squaring off over the best way to deliver cost-of-living relief across the country.
Labor
The Coalition has promised to reverse Labor's legislated tax cuts, instead promising a temporary halving of the fuel tax, which would save consumers around $14 a week if passed on in full.
They have also promised first-time home buyers tax-deductible mortgage interest payments.
The Crawford family moved remotely because of employment incentives.
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ABC North West Qld: Meghan Dansie
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Radiologist Nicole Crawford, who moved to Mount Isa in remote north-west Queensland a year ago for employment, hoped to see the major parties take up the mantle of increasing tax benefits for rural Australians, taking the responsibility out of the hands of employers to keep communities alive.
"It's really, really important to get people out here but also to keep people here long term because it's a very small community, but a fantastic community,"
she said.

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