Published on
14 Dec 2018
Tags:
For Parents

Teaching tax and super to youth

In 2018 the ATO commissioned independent research company Kantar Public to undertake a community research study to determine the following.

  • What are the current levels of awareness, behaviour and perceptions regarding the teaching of tax and super to children?
  • What strategies will be most relevant and effective in supporting parents and the wider community in teaching children about tax and super?

Existing research shows that young Australians’ knowledge of tax and superannuation is low, particularly in relation to the purpose of tax, the ability to complete a tax return and how to seek help about tax and superannuation. For this reason, we engaged Kantar Public to conduct research to inform the development of strategies, interventions, communication campaigns and tools to support the teaching of tax and superannuation to children.

The ATO's aim is to develop a youth education strategy that ensures an accurate understanding of and willingness to participate in Australia’s tax and superannuation systems. This research provides us with a detailed insight into community sentiment and perceptions about the teaching of tax and superannuation to children as well as the associated role that parents and the wider community play.

About the research

To ensure a thorough investigation of the research objectives, Kantar Public delivered a multi-modal research approach, incorporating both qualitative and quantitative elements. The qualitative research involved:

  • four focus groups with parents of secondary school students in Sydney, Melbourne and Toowoomba
  • six in-depth interviews with members of parents and citizens associations across Australia (VIC, TAS, QLD, ACT, SA and WA).

The quantitative phase comprised a 15-minute online survey of 1,506 Australians, including 1,005 parents (at least one child at school) and 501 wider community members (no children at school). All fieldwork was conducted in May and June 2018.

Key insights

Insight one

There are relatively low levels of knowledge and confidence among parents with respect to finances, and in particular tax and superannuation.

  • Only half of parents (49%) admit to knowing ‘a great deal’ about their personal finances.
  • One in five Australian parents report knowing little to nothing about the Australian taxation system and superannuation (19% tax and 20% superannuation).
  • One in five Australian parents do not feel confident explaining tax and superannuation to their child (18% superannuation and 19% taxation).
  • Over half of parents (54%) report to have not had any discussion around tax and superannuation with their child. However, parents with at least one child in secondary school are significantly more likely to have discussed both tax and superannuation than primary school parents (40% and 13% respectively).
  • There are low levels of awareness of tax and superannuation being taught in schools – only 7% of parents are aware of superannuation education, while 13% are aware of tax education.

Insight two

There is very strong importance placed on educating students about tax and superannuation.

  • Nine in 10 parents and wider community members think education on tax and superannuation is important (tax: 88% parent and 86% wider community; superannuation: 90% parents and 87% wider community).
  • Education on these topics is understood to extend beyond financial benefit to the individual, by ensuring a more financially literate population who will in turn be less reliant on government welfare. Education about the system as a whole is considered to provide students with a holistic understanding of their duty as a citizen and position in society.
  • Education about tax and superannuation is considered to be an essential life skill. It was recognised that the consequences of no education on these topics would lead to poor financial decisions and, in some cases, limited financial security.
  • It is widely agreed that education about tax and superannuation should be the responsibility of both parents and schools
    • seven in 10 parents (73%) and members of the wider community (59%) believe parents at home should be responsible for teaching children about tax and superannuation
    • seven in ten parents (68%) and members of the wider community (71%) believe teachers and schools should be responsible for teaching children about tax and superannuation.
     
  • While there is agreement about the shared responsibility for education, 90% of parents and 94% of wider community members agree that relying on parents to teach their students about tax and superannuation is inequitable for children as not all parents are equally knowledgeable.

Insight three

There is almost universal support for the inclusion of education about tax and superannuation in the school curriculum.

  • 95% of parents and wider community members think learning about tax and superannuation should be included in the curriculum. Further to this, the majority of parents and wider community members (both 87%) think education about tax and superannuation should be compulsory.
  • Of those who think education about tax and superannuation should be compulsory, 80% of parents and 88% of wider community members maintain education should be compulsory even if it meant replacing an existing item in the curriculum.
  • The most common year for introducing education about tax and superannuation was considered to be Year 10 – it was seen to have the highest relevance to children at this age as they often commence working.
  • However, on prompting, the majority of parents and wider community members support the inclusion of education in primary school (80% parents and 78% wider community). In particular, Year 6 was seen to be an appropriate time to overtly introduce the topics of tax and superannuation, with the potential for it to link with a government unit and trip to Canberra.
  • Four in five parents (78%) report how and why Australians pay tax is the most important lesson for students to learn about tax and superannuation, followed by why superannuation is important (75%). Interestingly, parents from a higher socio-economic background placed greater importance on learning about the concepts about tax and superannuation, while lower socio-economic status (SES) parents stressed the importance of learning practical information (such as how to get a tax file number).
  • The most popular format for delivery of tax and superannuation education is through a separate ‘life skills’ subject (61% parents and 60% wider community). Indeed, projects such as a ‘mini-business’ and teacher directed learning are reported as the most popular options for engaging students.

Insight four

To ensure support for the inclusion of tax and superannuation education in schools is optimised, it is essential to commence a conversation with parents and the wider community.

The qualitative research demonstrated that the perceptions of parents towards tax and superannuation changed over the course of the focus group. As the discussion progressed, parents became increasingly aware of the importance of educating their children about tax, superannuation and finances more broadly. This increased urgency was also evidenced in the quantitative research, suggesting that encouraging a public conversation about incorporating education on tax and superannuation in schools will be beneficial to gaining momentum for this cause.

Findings

Other key findings from the research participants include the following.

  • Only half of the parents (49%) know ‘a great deal’ about their personal finances.
  • One in five parents know little to anything about the Australian taxation system and superannuation (19% tax and 20% superannuation).
  • One in five parents do not feel confident explaining tax and superannuation to their child (18% superannuation and 19% taxation).
  • Over half of the parents (54%) have not had any discussion around tax and superannuation with their child. However, parents with at least one child in secondary school are significantly more likely to have discussed both tax and superannuation than primary school parents.
  • There are low levels of awareness of tax and superannuation being taught in schools – only 7% of parents are aware of superannuation education, while 13% of parents are aware of tax education.
  • Nine in 10 parents and wider community members think education on tax and superannuation is important (tax: 88% parents and 86% wider community; superannuation: 90% parents and 87% wider community).
  • It is widely agreed that education about tax and superannuation should be the responsibility of both parents and schools.
  • Seven in 10 parents (73%) and members of the wider community (59%) believe parents at home should be responsible for teaching children about tax and superannuation.
  • Seven in 10 parents (68%) and members of the wider community (71%) believe teachers and schools should be responsible for teaching children about tax and superannuation.
  • 95% of parents and wider community members think learning about tax and superannuation should be included in the curriculum. The majority of parents and wider community members (both 87%) think education about tax and superannuation should be compulsory.

How the research will be used

The research findings and insights are overwhelmingly positive. They will help us build a case for curriculum changes to have tax and super taught in schools.

This research also supports the potential for all Australian children to become knowledgeable and confident about tax and superannuation. Improving financial literacy will help prevent future strain on our economy.

More information

For a copy of the full report, email ATO corporate research