As you may be aware, the Treasurer addressed tax reform during the National Press Club event on Wednesday. Labor made several commitments before the election, but the question remains—where will the funding come from? They are now considering tax reform. Although the Treasurer stated he is not currently inclined to raise the GST, it remains on the table as an option. Are we expecting to pay more tax in the near future?
Labor Open to New Ideas on Tax Reform
nned2say on 19/06/2025 - 12:37
Comments
@tenpercent: I said very few things. I didn't say nothing at all.
the GST they pay on those goods will be covered by reduction in income tax. so Mum's long day at work, she will take home more pay for that chicken dinner.
@Jaduqimon: Mum's barely earning more than minimum wage. She already has no spare change even with a lower tax rate and some centrelink payments.
There are many things which attract GST which ought not (and vice versa). And no matter how you dice it, poor people pay a higher percentage of their income on GST than do less poor people. GST is a regressive tax; literally the opposite of a progressive tax (not that I am advocating for that; a flat income tax rate with a generous tax free threshold is much fairer).
@tenpercent: sounds like minimum wage is the problem in your scenario, not GST. Minimum wage still attracts a 16% marginal tax rate currently.
They can broaden the GST free categories for the poor but I also don't mind a flat tax rate. it just feels shit when the government takes 50c for every dollar I make after a certain point and they don't even spend it wisely.
sounds like minimum wage is the problem in your scenario
No, the problem is your idea of switching from income tax to a much higher and wholly regressive tax (GST).
it just feels shit when the government takes 50c for every dollar I make after a certain point and they don't even spend it wisely.
I agree. Been there, done that. Companies don't get taxed so highly and they get to write off all expenses against their income.
@Jaduqimon: I agree. GST is the solution. The way it was implemented was atrocious.
Gov just needs to balance the tax with the assistance so the poor can afford it (unless basic goods aren't taxed, but that was one of the things they screwed up the first time, and seems to unnecessarily complicate the system.)
@Muppet Detector: They may or may not. It would depend on which poor person you're comparing to which others. But I didn't make that claim.
I made the claim that they pay more GST as a percentage of their income and that GST is therefore a regressive tax.
@tenpercent: Not only is mum on a lower tax rate but she is also receiving Centrelink payments that increase her income but she is not paying income tax on that income.
Whereas
Someone on higher income pays tax on all the income he receives and does not have access to things such as reduced cost of health care and medications that those on lower incomes tend to get.
I think low income scripts are $7 vs $35 for high income?
Oh, and person on higher income pays more than low income earners for things like childcare.
When I was working with kids needing child care, it was cheaper for me to employ a nanny/housekeeper (and a gardener), than it was for me to pay childcare costs.
@Jaduqimon: You're making it sound like the bottom rung is easy street.I'm guessing you live on the other side of the tracks.
@Protractor: I don't think anybody believes that the lower incomes are easy street.
I think they are saying that those on the lower incomes pay typically pay a lot less for what they do use and consume.
I think they even get reduced charges for things like electricity, registration and rates.
Is tax rebate A and B a thing where people on lower incomes get paid money towards the cost of raising their children?
Pretty sure lower incomes also get rental assistance too, don't they?
So, reduced childcare, healthcare, higher access to most Centrelink type payments (aren't most means tested?) as well as other stuff I've mentioned?
Probably other stuff as well.
Fast food (yes, the poors tend to buy more fast food than everyone else) or even just a cooked whole roast chicken from Colesworth to make dinner easy for a single mum after working a long day and not spending any time with her kids? Sorry, you're going to get flogged with GST on that too, mum.
my small violin is working overtime on this emotional garbage
a precooked whole roast chicken from the supermarket attracts GST, buy an uncooked chicken…no gst, its quite easy to buy food and totally avoid any GST…..but frozen meals and cans of coke all attract GST
@MrThing: The single mum (not by choice; she is a widower after an Ozbargainer collided with her hubby at a roundabout because they don't know how to drive properly) also has a special needs kid who needs a lot of attention so she just doesn't have enough time to work to pay the rent and other bills and make a home cooked meal from scratch every night. With the cost of living crisis and electricity prices going to the moon she could barely afford it too.
@tenpercent: Yeah/nah
You had me cheering for you right up until you tried to justify poor people needing fast food.
Your hyperbole really lost you credibility points there.
It takes 5 minutes to stick a chicken in the oven and sort out a few fresh veggies in the microwave.
And if "mum" is time poor, maybe she could cook two chickens on Monday night so she only has to heat stuff up in the microwave on Tuesday night.
And any special needs kid who can't operate a microwave is probably eligible for NDIS and can buy Lite n Easy at 30% of whatever their RRP is.
@tenpercent: Just putting it out there that even reasonably young kids can get engaged with mum in the kitchen during meal preparation.
It can actually provide a lot of covert learning opportunities too.
• practising reading by following recipes.
• practising measurement and weights by measuring ingredients.
• following multiple step instructions by following the recipe steps.
• introduction to cooking and food preparation skills.
• sorting, categorising and organising skills.Even just setting and clearing the table and afterwards cleanup can offer all sorts of covert learning opportunities for most children.
If nothing else, it is still time mum can spend with child. Meal preparation has value too.
Plus nothing stopping mum and child/ren from chatting and catching up whilst they are involved in food preparation.
@Muppet Detector: Circling back to the original comment in this sub-thread
Raise GST, reduce income tax. thats how it should be, the more i use the more i pay. fair.
and to my first comment in reply
GST is and always was just a tax on "the poors"
and putting aside the hypothetical single mum which has been taken too seriously and derailed the conversation on a tangent…
Should poorer people pay a higher percentage of their income in taxes than people earning higher incomes; yes or no? If yes, why? If no, then how does raising GST rates and lowering income tax rates align with that?
@tenpercent: should poorer people pay a higher percentage of their income in taxes?
I know that the right answer here is "no" but I want to say "maybe".
I'm not saying I am correct, I even majored in Economics, minor Accounting in my commerce degree to try and learn about all this and understand it better and a lot of why we do what we do in these areas still isn't particularly clear to me.
I've even got a few semesters of sociology under my belt too.
But:
A few reasons:
We have a capitalist economy (which means user pays).
This also means that we operate as a meritocracy.
Despite the capitalism and meritocracy, we do have a socialist system in place to support those at the lower income levels at no additional cost to themselves.
They get access to additional income, benefits and resourses that aren't available to those on higher incomes.
- Equality => perhaps George Orwell said it best when he said "All animals are equal, but some animals are more equal than others".
For true equality in economic and social terms, that looks a lot like communism and I don't think that's worked anywhere in the world.
This makes me believe that the whole equality thing is a bit of a complicated balancing act.
I don't think people should be penalised because they do have more income than others either, but this is happening but as I said, it's a balancing act to not let this discourage too many people from staying engaged.
This would go against equality, capitalism, meritocracy and bump uglies with discrimination and impinge on their human rights.
If we discourage people from earning higher incomes, eventually most people won't bother to even try because we do have that social support system, so they all end up choosing not to pursue those higher incomes and live on the welfare system instead.
Now we have a majority of people accessing a social security system that has very few (if any) people contributing taxes etc towards it.
This ends up with Bob Geldof organising Live Aid fundraisers and entire families across the whole country living on one cup of rice a week cooked in non potable water, no infrastructure, no sewerage system, nobody producing anything for anybody to consume and definitely no education or healthcare, policing, national defence, not even any jobs etc.
It may even result in nobody leading the country and implementing all this stuff because eventually there is no money to pay them either.
This results in nobody acquiring the skills needed to sustain a society, nobody building houses or being teachers or doctors etc
Nobody to enforce a legal system resulting in chaos and anarchy etc
Can you see where this is going?
I love that we live in a country where most people have a reasonable baseline to live and survive, so a little bit of communist principle/policy.
But for everybody to have that, some people do have to be more equal than others and whilst most people get participation ribbons, we've also got to reward and encourage those with the ability to produce medal winning performances.
=> there's a few of my thoughts to mull over
@Muppet Detector: What do you title this essay? "Strawman Writ Large"?
My question was:
Should poorer people pay a higher percentage of their income in taxes than people earning higher incomes; yes or no?
It seems you are trying to say that if poor people were to pay a lower percentage of their income in taxes or if we were to scrap GST then the dominoes would be set off for the country to fall to pieces and we would eventually have to rely on foreign has-been pop stars to raise charity funds for any of us to be able to eat. Which is probably the most absurd thing I've read in all of the Ozbargain forums.
If that's not what you are trying to say, may I suggest giving a more direct answer such as "yes" or "no" followed by some reasoning if you feel inclined.
The fact you didn't give a direct answer suggests maybe you're a politician-in-training and that you probably both (a) think that yes poorer people should pay a higher percentage of their income in taxes than higher income earners because fcuk 'the poors' right, and (b) you actually know that holding such a position is 'bad' and would not go down well with the overwhelming majority of the electorate hence your reluctance to give a straight answer.
@tenpercent: It's not a yes or no question.
I tried to engage in your discussion with respect and you responded with personal attacks and inferring I said things that I didn't even refer to, far less say.
Apologies that my reasoning, analogies and explanations didn't align with your opinion but I'm not interested in exploring this topic any further with you.
The government earns enough off the back of the tax payers of Australia.
Key items that should be on the agenda:
1. CUT GOVERNMENT WASTE (the tax payer paying $5K for something that costs $100 anywhere else in the country by individuals and businesses is an absolute joke - the government should NOT be paying to prop up unprofitable businesses that simply want to price gouge the tax payer - government employees are complicit).
2. INCREASE PRODUCTIVITY (increase productivity, cut red tape and in turn reducing government headcount - more government workers should be fearful of job losses and should actually do work (being there and talking about work is not doing it), there should be a complete uplift in productivity - I've worked with over 1000 businesses and 20 different state (multiple states), federal and local governments over my career, the waste is egregious and disgusting - if you physically saw how lazy, entitled and ineffective 99.9% of government workers are, you'd be storming Canberra. You would have never seen more people in your life that are great at talking about work and how it should be performed (without ever actually doing it) and your tax dollars are paying for that privilege - cut the waste - the government's purpose is not to create careers off the tax payers back and in turn leads to career incompetence.
3. CUT IMMIGRATION - I'm not saying immigrants are a problem at all. But the "housing crisis" is one of the government's own making. We should be focusing on increasing our housing supply, not diminishing it. If the government only allowed trades or those that got apprenticeships here from other nations we'd have no housing shortage.
4. BUILDING SUPPLY - We have the 5th largest land mass of any country in the world, we DO NOT need everything in 1x location. Spread out! - Increase immigration of trades, provide bridging courses, free up crown land for housing opportunities.
5. DECREASE CORRUPTION at all levels of government (Cronyism, nepotism, kickbacks, quid pro quo's, corruption at all levels - its ridiculous) - the government shouldnt be imposing its will
6. FIX NDIS - the cost blowouts are disgusting - this should be fixed as a matter of priority.
7. Zero DEFICIT - the future generations should not be funding for the failures of our political leaders - we should say for each $10 million the government goes into deficit (state or federal), State and Federal politicians lose $10K from their pay packets (watch how quickly they pull their fingers out and how quickly budgets go into surplus magically)There's much more but the above should be a start.
Run for PM i'll vote for you.
or are you one of these guys you mentioned?
"You would have never seen more people in your life that are great at talking about work and how it should be performed (without ever actually doing it)"
How can you oppose it if it is called reform? /s
I think the words "new and improved" get thrown around along with "Digital Transformation"..🤔
People want stuff - healthcare, police, defence, education etc.
It costs money because providing valuable stuff costs a lot.
You can pay for it with taxes or borrowing.
Better to pay with taxes than adding debt.
Different people prioritise different spending. You get to vote for the mob who aligns with your priorities.
Different people prioritise different sources of tax.
Best to tax those who it hurts the least.The government could just take over the money creation role and 'print' (or type numbers into a database) it into existence.
I can't refute MMT, but I also don't want to be living in the place which applies it fully to the real world.
I'll let someone else (by the looks of it, the USA or Japan) run it to conclusion before I think we can believe it.There are no good contenders to try it how I suggested. The USA and Japan both have central banks who lend the monetary credits at interest and they will not be cede that control lightly. Trump and the current Congress certainly won't take that power from them.
Perhaps they could go after multi nationals that shift profit around the place. Exon, Ikea, Aldi, Apple etc.
One small issue I have here is that People in higher income tax brackets are taxed more and the reason is they should contribute more as their taxes are used to provide societal benefits but when its their time to use those services they are told they cant because they earn too much. Case in point being Childcare or Medical services.
Your child care support payments are reduced and you are forced to get PHI for the very services you contribute more too.I get where you are coming from. I think we should make sure everyone has access to public services - it is a great incentive to make sure schools and childcare and hospitals are well funded if the more well off depend on them too.
Exactly. If no one is paying out of pocket separately for stupidly expensive shitty childcare or private health or private schools then they wouldn’t care as much about the higher taxes.
Except of course the “but I’m never sick so I shouldn’t pay for it” or “but I don’t have kids so why am I supporting someone else’s” mobs.
Just close all obvious & longstanding tax loopholes first and foremost.( The scum corporations making billions and paying ceo millions.)
Implement a BS tax on the mSM.
Charge miners for water.
Means test assets for all ag handouts (inc trust funds and investment properties)
Phase out the perks of NG and CGT, to be applicable to max of 2 or 3 properties max
Give Albo a pay riseor just increase GST, far less admin and far less opportunity for rorting
Admin? FFS, I'd create 30,000 PS jobs just to chase down and force the greedy pricks to cough up what they should be paying and still cover their salaries.
Corporations making billions are fine. The problem is the (majority) owners of such corporations are usually just few elites aka the billionaires. The current tax system is unfair because it makes PAYG tax payers to pay more tax (relatively) than the billionaires. For a billionaire to reach a net worth of, say, 1 billion dollars, I doubt that they would have paid even 200 millions (20%) of taxes. But normal people who make 200k a year, accumulate 1 million after 7 years, and would have paid 390k of taxes (~28%). We need a revolution, not a reform. Get rid of the income tax.
Are you going to phase out all negative gearing or just that imposed on property/providing accomodation services?
What are the perks of CGT?
Pointing out that one tax loophole is that utes aren't subject to LCT.
If they had any brains or balls they would move to a system like Qatar :/
Anything taken out of the ground/sea of the country, the entity doing the extraction pays 35%, citizens pay 10% income tax!
Or even mimic Saudi Arabia and their Saudi Aramco. The government has a huge equity stake in the projects pulling valuable stuff out of the ground/sea.
yep i dont think saudi arabia should be an example of good government to mimic in australia
Jamal Kashoggis widow would probably disagree, with your example..
ROFL, the thread topic is tax reform …
If you think a suggestion that focuses on a single element of a government (taxes) implies the desire to implement the whole government, than that's a massive reading comprehension issue on the reader, not the commentor :/
Better to generalise and target the concept of "property" ownership itself than the extraction.
We need a general property tax based on "market value" per individual ownership and it needs to be highly progressive. For example, 500k of property, 0 tax; 1m of property, 1%; 1b of property, 10%. They could be taxed annually or based on revenue. Property includes things like intellectual property as well, basically anything significant that requires protection and enforcement from the government.Indeed, it's obvious people are too stupid to separate a "tax system" from an entire countries "government system"
Who would assign the value? And if I am a pensioner and own my inner city house valued at 3Million that I bought 50 years ago do I pay the tax?
The numbers I gave are only for illustrations. The point is to discourage the ownership of hundred or thousand hectares of land in the hand of one person. And if the land contains resources, obviously the value will go up.
For sure, someone smarter than me can come up with a formula or a fair way to calculate the market value.
Yeh I remember when Kevid Rudd tried that….
It's insane that the only idea the government (from both sides) ever has is, Tax citizens more!
Billions of value being dug out of the ground in our country and yet we still have one of the highest taxes in the world.
100% agree. No government in Australia should ever try and find new ideas to fix our problems.
The problem is that the political leaders dont think or model the repercussions of their actions. "Giving it a go" (on the taxpayer's dollar) is not good enough.
If they provided something with sound logic, with tried and tested results I'd be all for it.
OP old man yells at cloud
When the election's on its "Labor knows how to run the country, vote for us". Then after the elections they're looking for ideas.
As opposed to the Dutto (who??) LNP mob. No idea before ,during or after the election, and not interested in asking what the people want or need.
(Tracks of My Tears, gently enters the background)
i want to hear from our melbourne correspondent, @jv
How could Dan do this to us?
You need to read in between the words. They won't broadcast their policies ahead because then people structure themselves to skirt the law when it comes.
What he is really saying is moving toward wealth tax.
Ordinary income earners are increasingly asked to fill the gaps because the working class is shrinking due to continued low birth rates and people living longer. The people immigrating here aren't replacing the tax fast enough as they are naturally earning lower income or aren't ready to earn in the short/medium term.
But consumption and imported inflation is still inflating assets like homes. All of this is unproductive and makes Government action more expensive as years go on.
Australians hate discussing this stuff like this because they get gas lit into thinking it's an assault on your freedom but in reality society is no a zero sum game.
FTFY
They won't broadcast their policies ahead because then Murdoch et al, will run a BS campaign to destroy the chance of success locking us into another epoch of economic stupidity & structural inequity.And forcing the govt to lose the election, or dump the reforms or both.
this…look what it did to shorten when he dared utter the words "CGT" and "NG"
he may as well have slaughtered a baby for a blood sacrifice
And KRudd before him with the mining tax.
I liked the idea that I "might" one day be wealthy.
I know that will never happen under Labor and because of the spending of the Labor government, by the time it could have happened, Australia will be in so much debt that i'll be taxed so much by that point, that it could never happen.
He's going to introduce an inheritance tax as he always planned to…
Good. Bring it.
You have to agree, jv, he's a bloody genius. He is worth much more than the pittance he gets paidGood. Bring it.
Why?
Why not?
tbh an inheritance tax is probably a better and fairer idea than his weird machinations with super (the unindexed unrealised capital gains tax).
its a waste of time, just look how effective it is in the UK
HMRC reported that 27,000 estates (3.73% of all deaths in the UK) paid inheritance tax in 2020/21. UK Parliament
Depends entirely on how you set the thresholds.
@tanksinatra: I think its more down to estate planning and people shift assets before it reaches whatever designated period of time before death that an inheritance tax will occur
@MrThing: The statistic is a bit misleading because in the UK inheritance tax is completely avoidable if you give away your assets 7 years before death, no matter how much.
For the extremely wealthy, the main way to avoid it is by paying it in advance (which makes tax planning easier as most people can't predict their death 7 years in advance). This isn't counted in the statistic referenced.
Oh no inheritance tax!
Maybe I'll just gift assets to my many offspring. Or if I'm filthy rich I already have everything of value protected inside layers and layers of trusts.which is exactly what already happens in the UK, hence the tiny amount of people who actually pay it
There already is inheritance tax, its on super if the beneficiaries are not dependants, which children are not if they are over 18
\15% for the taxed element and 30% for any untaxed element.Family home and other properties, shares, invenstements are not always within super and Labor want to tax them when inherited. Basically they want to treat them as income to the person inheriting.
Understand that but Australia already has a form of inheritance tax. And if they did introduce this no doubt the super wealthy have a means around this via trusts etc.
Taxes are a means of wealth transfer to the poor and the 1%. The poor I have no issues with.super wealthy have a means around this via trusts
Lots of people have trusts, not just the 'super wealthy'
@jv: Trusts are only viable if you have sufficient income producing assets to protect, are a business owner wating to distribute income across multiple benefactress or very wealthy.
For the average PAYG they offer very little in the way of tax reduction opportunities
Although the Treasurer stated he is not currently inclined to raise the GST, it remains on the table as an option.
Labor had always wanted to raise it to 15%
Better if its 25% and lower income tax by 15% across all brackets
Maybe… Maybe not…
They'll need to first pay are few $100 million to consultants to produce a report.
Consultant is pollie speak for Lib staffer side gig.
Didn't they initially oppose GST?
Yes, and then they wanted to increase it to 15%…
Well that's a big old back flip with a double pike if I ever saw one!
Well that's a big old back flip
Caused a lot of infighting, and together with another attempt to introduce an death/inheritance tax, cost Labor an election they were otherwise always going to win…
https://www.abc.net.au/news/2016-02-01/labor-says-new-opinio…
@jv: One state premier is apparently all of Labor now. The death/inheritance tax was Murdoch bs and you know it.
@jv: You might be waiting a while.
https://www.alp.org.au/the_facts_about_an_inheritance_tax
https://www.smh.com.au/federal-election-2019/labor-demands-f…
Im not against 'tax reform' but the government needs to be 'held to account' with its spending
to be 'held to account' with its spending
They are not though, especially in Victoria…
Can you play the didge jv?
The solution is easy - for every 10 million in debt they go into, take 10K from the politicians pay.
It is no wonder they made the capital in Canberra - its too far to walk to, in order to storm the capital from Sydney or Melbourne for the Federal Government's incompetence!
@Jaduqimon: Oh yes. All the poor people and their purchases of…
/s
How about clothing? Something as basic as clothing that everyone including "the poors" need.
How about bus and train fares?
Petrol?
An old beater car?
Fast food (yes, the poors tend to buy more fast food than everyone else) or even just a cooked whole roast chicken from Colesworth to make dinner easy for a single mum after working a long day and not spending any time with her kids? Sorry, you're going to get flogged with GST on that too, mum.