Australias tax system takes from the young to give to the old

[Caesar]

unfortunately this is a byproduct of how our constitution is written

the first Uniform Tax case in 1942 effectively gave a monopoly on income tax to the federal government… ever since, they’ve been addicted to it

as a result we have the second-highest corporate income taxes and the fourth-highest personal income taxes in the OECD

it’s absolutely atrocious for the economy. We should cut both corporate and personal income tax to be closer to the OECD average, and instead focus on taxing resource extraction, assets and consumption (which are all incredibly undertaxed by international standards)

Will never happen though - requires too much compromise between self-interested state and federal governments. You just have to look at what happens when anyone talks about raising the GST.

 

[Barrybran]

Also hurts cashflow of businesses and will cause prices to go up.

Any business owner spending their employee's super has to find it within three months anyway. Prices aren't going to go up because responsible employers are paying their employee's super.

 

[Captivating]

Any business owner spending their employee's super has to find it within three months anyway. Prices aren't going to go up because responsible employers are paying their employee's super.

Very good point. Employers doing this are one step away from failing to pay super guarantee, which is their employees money, of their own.

Sadly, $3.9 billion of SG isn’t being paid. Employers are screwing over their employees

 

[Barrybran]

Very good point. Employers doing this are one step away from failing to pay super guarantee, which is their employees money, of their own.

Sadly, $3.9 billion of SG isn’t being paid. Employers are screwing over their employees

There are a lot of business owners that don't care. There are many more that just don't understand. A lot of business owners don't see tax, super, etc. the same way as an electricity bill or paying suppliers, which have tangible results if left unpaid.

 

[CakeEater]

Any business owner spending their employee's super has to find it within three months anyway. Prices aren't going to go up because responsible employers are paying their employee's super.

Yes Baz but that still impacts on cashflow.

I.e they now have to have 11.5% more cash on hand on Payroll Day. As opposed to having 3 months to build up cash reserves to pay super

 

[Barrybran]

Yes Baz but that still impacts on cashflow.

I.e they now have to have 11.5% more cash on hand on Payroll Day. As opposed to having 3 months to build up cash reserves to pay super

Budget and pay it.

Once you employ someone, the money is no longer yours as the business owner anyway. It belongs to your employee via their super fund.

I understand that some industries don't have regular cash inflows (ie. farming) but the premise is the same - budget.

 

[brutus76]

Prob need to lift the GST - its 20% in the UK after initially starting at 10%

Make it 15% on some goods and services (luxury stuff) and making 0% on more day to day essentials associated with the cost of living that everyone needs to survive (food, medical items, personal care items, household staples)

 

[Alite]

A few things worth mentioning.
I’m 78 and have spent a lifetime paying tax in every form. I no longer work and so do not now pay tax. I live off the savings put aside from my earlier net earnings. I receive no govt or commercial benefits (except health care and cheaper haircuts). Any wealth or privileges now enjoyed is the result of a lifetime of work.
But to address your point I need to remind you and others that tax is not Govt revenue. Tax is not used for govt spending. Tax is only used as a tool to control inflation or to discourage certain activities (eg, smoking).

You had me riding the cheer train until you said that Tax is used to control inflation… and the rest.
You seem to understand this stuff and so please explain what happens when the RBA is putting up interest rates (and may do again) while the Government is giving tax cuts.

Who loses? Answer: Mortgage holders who are paying off their own home and those that have an investment unit= rents go up. Who wins? Those people with savings.

Be clear, I think every self funded retiree should be lauded and given every leg up to stay self funded. I intent to be one myself. Just know that you likely paid at most 3 times your wage at the time when you bought property while it is now 9 times (get that … Nine times) the normal wage to buy a property. And ALL costs are now being put on mortgage holders. It is NOT about the control of inflation. The RBA governor herself said it is about “increasing unemployment”. Look it up. She also said Australians are doing well and have a lot of savings BuilT up during CoViD-19 lockdowns (yet her own graphs showed the savings of Australians had dropped below pre-CoViD numbers).

Interest rates are about control of people… not inflation.

Aside: the inflation issue is SUPPLY based and Australia could never control it with DEMAND-suppression any more so than if they were paddling in the rapids with a spoon. The inflation issue started with money printing… which is Keynesian theory.

Keynesian theory could work IF savings are made while times are good… but politicians rarely save.

This music video says it all:

 

[Chief]

 

[Seeds]

View attachment 2052950

Meme makes zero point. its still worth being upset by even if their wealth was created solely by hard work and trickle down economics was true.

If i took away your house that you bought and paid off with 15 years of wages you would still be rightly aggrieved even though you can work for another 15 years to buy a new house. As i stole 15 years of your wages

 

[peetoo]

Just in case you wondered why there were so many 10 million dollar super accounts

Here’s an article about people spinning unrelated shit about why their rort shouldn’t be taken away

New $3m super tax is ‘stealing my children’s inheritance’

Family enterprises face hard questions about whether to abandon their succession and retirement plans by selling their shops, farms and factories,

www.afr.com

 

[Seeds]

Prob need to lift the GST - its 20% in the UK after initially starting at 10%

Make it 15% on some goods and services (luxury stuff) and making 0% on more day to day essentials associated with the cost of living that everyone needs to survive (food, medical items, personal care items, household staples)

Its doesnt need to be gst. It can just be taxes on assets which are criminally undertaxed.

 

[peetoo]

Meme makes zero point. its still worth being upset by even if their wealth was created solely by hard work and trickle down economics was true.

If i took away your house that you bought and paid off with 15 years of wages you would still be rightly aggrieved even though you can work for another 15 years to buy a new house. As i stole 15 years of your wages

Billionaires seem to have a hard time doubling their wealth inside a decade like a bog average home owner.

I really feel for them

 

[Seeds]

Just in case you wondered why there were so many 10 million dollar super accounts

Here’s an article about people spinning unrelated shit about why their rort shouldn’t be taken away

New $3m super tax is ‘stealing my children’s inheritance’

Family enterprises face hard questions about whether to abandon their succession and retirement plans by selling their shops, farms and factories,

www.afr.com

Even with the change it is still a massive rort. Why arent we all paying our marginal tax rate for super earmings? My marginal tax rate is 47 per cent yet i only pay 15 per cent on super earnings. Same as everyone else. Its ridiculous. With these changes i would pay 30 percent but only on the earnings coming from assets over 3 million dollars. For assets under 3 million its still 15 per cent.

 

[Chief]

Meme makes zero point.

It makes an excellent point.

People who walk around saying poverty is a moral failing are w***ers, basically.

That's subtext!

 

[Chief]

Even with the change it is still a massive rort. Why arent we all paying our marginal tax rate for super earmings? My marginal tax rate is 47 per cent yet i only pay 15 per cent on super earnings. Same as everyone else. Its ridiculous. With these changes i would pay 30 percent but only on the earnings coming from assets over 3 million dollars. For assets under 3 million its still 15 per cent.

Super isn't supposed to be a tax minimisation vehicle.

It's generally for giving people a basic level of support that the government won't be able to afford (and still provide other services).

 

[Seeds]

Super isn't supposed to be a tax minimisation vehicle.

It's generally for giving people a basic level of support that the government won't be able to afford (and still provide other services).

Which is exactly my point. Yet right now its a massive tax minimisation vehicle. Even with the changes.

 

[Golden_6]

Just in case you wondered why there were so many 10 million dollar super accounts

Here’s an article about people spinning unrelated shit about why their rort shouldn’t be taken away

New $3m super tax is ‘stealing my children’s inheritance’

Family enterprises face hard questions about whether to abandon their succession and retirement plans by selling their shops, farms and factories,

www.afr.com

I can assume these articles are created to create outrage against the wealthy.

The perception around super needs to be reframed to what it should have always been. A mechanism to allow retirees to support themselves during retirement, not an entire wealth creation and tax minimisation vehicle. The proposed changes should help that.

I also don’t even get the outrage. As the article mentioned, people with this level of wealth still have plenty of scope to create entity structures to minimise tax. If it means transferring assets out of super and into the normal tax system, that’s a benefit overall to the country.

Not one single individual needs more than $3 million in assets to support their retirement years.

 

[stefcep]

Prob need to lift the GST - its 20% in the UK after initially starting at 10%

Make it 15% on some goods and services (luxury stuff) and making 0% on more day to day essentials associated with the cost of living that everyone needs to survive (food, medical items, personal care items, household staples)

The latter is more or less what we've got now. The GST was held up for months in parliament for this very reason.

 

[burge13]

Prob need to lift the GST - its 20% in the UK after initially starting at 10%

Make it 15% on some goods and services (luxury stuff) and making 0% on more day to day essentials associated with the cost of living that everyone needs to survive (food, medical items, personal care items, household staples)

Not in favour of lifting gst unless they remove one of the many crazy amounts of taxes we pay. We are taxed enough, i have NFI why every day people champion raising any tax. Champion a government with sensible spending instead, they seriously get enough money via our taxes.

Tha said very in favour of GST exempt products. Fruit and veg, medicines etc shouldn't attract GST. Id be in favour of sporting/gym costs being tax deductible. Give people some incentive to move more and get healthier. It will help the health system long term

Or tax the ass end out of unhealthy foods like sugar and mcdonalds etc. Obesity is a huge cost to us

No more raising taxes though. Stamp duty, excise taxes, GST, income tax, payroll tax. If the government doesnt have enough money then sort out procurement rorts for government contracts, get rid of public service bloat, tax Woolworths/CBA/Santos etc more and people less. We shouldn't pay a cent more than we do as regular folk

 

[kickazz]

Wealth tax defeats the purpose of making money.

Incorrect.

It defeats the purpose of hoarding capital and leaving it to fester.
Combined with LOWERING income tax, as OP suggests, it encourages the making of money.

 

[peetoo]

A dollars live in a persons posession, including coming in and out of posession, there is a significant amount of deductions.

10 or 20 percent gst. 25% income. Stamp duty with interest on repayments. Super account fees.

Is the true value of the dollar barely 50c?

 

[rank and file]

Incorrect.

It defeats the purpose of hoarding capital and leaving it to fester.
Combined with LOWERING income tax, as OP suggests, it encourages the making of money.

Seriously, good to learn.
Makes sense.
TBH I don't much about the tax system.
Try and avoid it.