Why Australian tax data says people in this rural farming area live on negative income

Photo: Getty Images.

Yesterday the Australian Taxation Office released figures which revealed the richest postcodes in Australia, as well as the postcodes which had the lowest incomes.

At the top of the latter list was the postcode 2387, which covers Bulyeroi and Rowena in western New South Wales, south west of Moree.

This area is the only postcode in Australia that have reported an average taxable loss in 2014-15, totalling -$8,832.

At first we weren’t sure how this could occur. Based off our knowledge it would essentially mean that on average the 132 individuals living in the area would have had no taxable income to claim, and in fact they would have had lost money that financial year.

When we asked the ATO if that was the case however they couldn’t give us an explanation for the loss of almost $9,000.

“Unfortunately we don’t provide analysis on the tax statistics and can’t speculate on why this would be the case,” the spokesperson said.

2387 is highlighted in red. Google Maps.

Next, Business Insider asked social researchers McCrindle to shed light on the negative figure.

After digesting the Census data and other demographic statistics on the region Mark McCrindle, founder the organisation, said it came down to the dry conditions the area has been experiencing over the last five years.

In 2012 the region was affected by floods, two years later it was in severe drought, and those conditions appear to not have subsided since then.

The loss has nothing to do with unemployment in the region — 82.7% of people are employed full time according to the latest available Census data — rather it is the industry they are employed in.

“The number one employment sector, with 98% of people, is farming,” said McCrindle. “In other words its an agriculture region.”

Rowena is mostly made up of crop farms, some cattle and other livestock.

According to information from the government’s primary industries website, McCrindle said the Walgett Shire, where the postcode exists, is in quite serious drought conditions.

“If you’ve got an agriculture region where the 132 people are largely farmers… with such a high average lost it says the whole region is not moving ahead.

“When I look at the 2011 ABS data for the region, the average weekly household income is $1,020 versus the average weekly household income for New South Wales which is $1,237. They are earning 20% less than the state average.

“It’s an agriculture area that has fallen on very hard times… they are doing it tough out there.”

We also spoke to Walgett Shire councillor and local land holder Tanya Cameron, who was somewhat surprised by the loss.

“We had a bumper season last year but before that we have had a number of average seasons,” she said.

“There would be various reasons [for the loss]. I would think the prolonged drought, low commodity prices, and the high price of land. If you’re trying to expand you can go into debt because of the price of land of the cost of expensive machinery.

“But a prolonged period of drought yes that would be the main reason.”

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