I was thinking about this today….they should get rid of people paying taxes in Australia like income tax,capital gains,luxury car tax….all taxes and replace it with a simple system of tax
Like 1% tax to be paid on every single transaction you do. Would that not be better and actually collect more taxes and makes it fair on everyone?
@helldoodle: No. I'm saying it is a mathematical fact that Australia has one of the least representative democracies in the world. There are third world countries outperforming Australia. I'm saying our current system is not fit for purpose when the vote is split almost equally 3 ways. It worked back in the old days when 90%+ just voted for red or blue, but that's not the reality in modern Australia. We need a modern electoral system to restore our democracy.
@tenpercent: nope, we have more Labor supporters and Union members every year, I signed up another 7 people after Rick Wilson came on site and talked
@tenpercent: You want to give us the links where they promised not to change the Superannuation system? It has been regularly changed by both sides since it was brought in many years ago. Personally I will probably never get a pension and I’m nowhere near $3 million in funds.
Hopefully the Government will get onto minimising tax avoidance as well. Lots has been done and more to be done.
@try2bhelpful: Maybe one of these days they'll promote welfare minimisation as well. We would probably save a lot more money by not giving the aged pension to people with million dollar houses than thieving from people who did their best to avoid sponging off the tax man with the aged pension and who instead invested in their super and have already been taxed on it.
@tenpercent: Frankly I’m a leg in a number of camps. The house, the Super and shares. In the 1980s, when interest rates were truly eye watering, I shoved as much money as I could into paying off my home loan. We lived pretty frugally for a while but I grew up in a household where that was pretty much the norm. A home is not a realisable asset unless you sell it, then you have to find somewhere else to live.
Your argument sounds awfully like you are taxed on the money that you earn to put into your bank account so you shouldn’t be taxed on the interest you receive. Frankly Superannuation is already incredibly generous, particularly once you get a reasonable amount. You draw it out tax free once you get over the threshold age. Right now I’m living a pretty good life and I have nowhere near 3 million in Super.
What is sponging off the tax man is the family trusts and tax avoidance schemes. People who have stacks of money and want even more. They are the real sponges because they are driven by greed. I could live on the old age pension but I wouldn’t like it.
If you don’t like paying the tax over the $3 million mark I’m happy to take the money off your hands. I’d be very happy to pay the tax in return.
A home is not a realisable asset unless you sell it, then you have to find somewhere else to live.
So? Downsize then. Let someone younger with kids at home make use of the spare bedrooms. Too many multi-million dollar houses occupied by one or two old farts who are living both tax free on their super and on partial age pension. To echo onesandtwos, above, the taxpayer shouldn't be subsidising "a mega rich lifestyle" or even a relatively rich lifestyle. If you want to be consistent then million dollar PPoRs should be factored in too.
OR… maybe pulling the rug and changing the rules on people is wrong for both people who have wealth locked into PPoR as well as for people who have wealth locked into Super.
Yeah, the trust fund people are sponging too. Don't disagree with that. That's a separate but related issue.
If you don’t like paying the tax over the $3 million mark I’m happy to take the money off your hands. I’d be very happy to pay the tax in return.
I hope you do gigs at the comedy club. Your talent is wasted here. /s
Seriously though, the biggest issue with that proposed tax is taxing unrealised gains above $3M (absolutely preposterous) and the lack of indexation (which just means introducing bracket creep to Super as well as Personal Income Tax). Although I think they're considering amending that.
@Cheapskate Paul: Does it matter? What's the threshold number of people to subject to a rug pull before it become unfair?
all other tax etc points aside, why would people in the positions of power change the status quo, if they are feeling OK in the current system?
just to answer the actual question in title
You gain a position of power, and keep it, by never being satisfied with the status quo.
The main problem is too much spending by government. With 16.3 Million people in Australia on some form of welfare what do you expect? Paying income tax is good for the country, paying no tax is neutral but getting welfare (or negative tax) is bad bad bad. This majority on welfare won't vote it out and more taxes won't fix the underlying problem. Look at it this way, how can someone get a full pension and all the benefits and own a $5 M dollar house and pay minus (yes minus! ie get someone elses hard earned tax they have paid) tax of the free taxpayer's money they get in their pension!
From an economic perspective, welfare is not "bad bad bad". It feels like you're talking about moral issues with welfare rather than economic ones.
It's a mostly neutral economic impact with positive social impacts. Someone on a disability who isn't able to work gets a payment and what happens to it? It cycles back into the local economy. Once you get outside of rent, food, transport and the basics there's not much left for someone on a pension. That goes on to pay GST, pay wages, generate profits for local companies, it just cycles around. At the same time, there's the social good of providing someone in need with a home, a life and the ability to not die in the streets. It's well worth the miniscule cost of funds that go overseas.
Reality is that we need enough people working to sustain all of us, so the government does crack down on people not working when they should be. But if too many people worked, if workforce participation was too high, it simply drives down wages and drives up unemployment. So the government pays more in welfare to those who need it and less to those who don't. As a result, a lot of welfare gets paid to different people, but in differing amounts. Some is also paid because there's a greater economic benefit to be had - some people need economic support to go to work so it's worth paying a little to get a lot.
I'm sure there's some old person out there with a $5m house, few enough shares to stay on the pension but also get a few franking credits, but that's just a side effect of the insane housing market and how much money we have tied up in it. It makes economic sense for them to downgrade and live a much better lifestyle, if they don't though it's not really a big economic impact. It would be nicer if they'd do the "right" thing, that's all.
If you really wanted to go for the economic jugular and improve the tax situation - start killing old people. We have a shortage of care workers to look after them, the government pushes crap wages to nurses be even able to fund it as a system and we import staggering amounts of medical equipment and pharmaceuticals to keep them alive. Probably wouldn't win too many votes though, turns out the economy is meant to work for the people, the people aren't meant to work for the economy.
If you really wanted to go for the economic jugular and improve the tax situation - start killing old people.
I was ready to give this comment a like and then I read that Malthusian paragraph about killing old people, as if we ought to imitate the Nazis and their T4 Program / Action14f13 which was a precursor to the Holocaust.
Your position on it is unclear to me, other than you are aware it wouldn't be popular.
Your position on it is unclear to me, other than you are aware it wouldn't be popular.
Depends what they taste like.
In all seriousness, I'm 100% against killing anyone for economic gain. Or even letting them die for economic gain (although that's always a tough one, I'm glad I don't have to decide what medicare does and doesn't cover in terms of expensive drugs. I'd approve everything).
It was meant to be an example of how insane putting economics ahead of people is, but I realise in hindsight there are probably people who read that and went "that's not a bad idea!". But, like the Nazis, they're usually people who understand neither economics nor compassion.
@freefall101: But prolonging their life for economic gain is acceptable, even when there is no quality of life?
Where is the line…?
Freefall was obviously not advocating for that. It was very clearly tongue in cheek. Sometimes you're a wee bit desperate for attention.
@BuzzBuzzBuzz: Sadly there are very real people who genuinely think that's a good economic policy we should aspire to. The line between "very clearly tongue in cheek" and "I genuinely believe this" is blurred more and more these days.
retiredandsilly - name definitely checks out
ROFL op - have you seen the ALBO and co labor government. We are almost 1 trillion in debt for the first time EVER in Australia.
That means paying $1 billion (just in interest) to this joke of a government.
They will leach and squeeze every dollar they can out of us (the tax payer) in order to spend money on dumb things that aren’t needed (increases to politicians wages).
They're pretty good with spending money wherever it will keep people voting for them. National debt is always the next government's problem.
Might want to look up who’s returned budget surpluses recently. Recent Liberal governments did a good job increasing debt levels too (even excluding COVID years)
The recent surpluses have been shown to be a fluke (where there were additional royalties from higher than expected iron ore royalties…)
But sure, blind luck and high spending deserves a pat on the back - Albo and co rolls the dice again on the high rollers table (Australian Tax payer as the credit card)
So you're willing to add more context when it comes to defending your side, but when it's about debt and government spending, the simplistic view will suffice?
checks OP history
Right…..
I understand the logic, it's there. It will be a hell of a shit show to implement it. For example if GST bumped up to 20% or even 30%, I wonder how cost of living such as groceries will look like with someone on 50k salary vs 100k salary since they're take home pay is not taxed.
Simple calculation and with ChatGPT help, if GST bumped up to 30% and every other tax stream stopped, it will not make up the current tax revenue the government is making:
Current tax system raises ≈ $600b/year.
A 30% GST-only system would raise ≈ $261b/year.
That’s ~44% of today’s tax revenue — meaning the government would need either a much higher GST (probably 60%+) or introduce new taxes to balance the budget.
Will business/corporate profit tax will stop as well(?), that a huge revenue stream for the government, but if that still in place, then the balance sheet might still be in a deficit.
"If Australia keeps company & business taxes but abolishes personal income tax while raising GST to 30%, the government would collect about $471b/year instead of $600b — a ~21% drop in revenue."
It does not cost $600b to run a country with the number of people we have. Cut the waste, increase efficiency and prioritise a future for all
I'm not saying it cost $600 billion to run a country.
My post was about generating the same
Tax revenue If GST was the only tax in Australia.
That the government receives 600 billion in revenue off the back of Australians and spends more than that consistently is the problem!
Do some reading dude(ss). You need a lot more info on this before asking stupid questions.
Scrap all tax and let the government print exactly the amount they need. The devaluation of the dollar will be equal to the amount you would have lost in tax.
they wont change the system to be 'fair' because it benefits the richest the most and guess what out elected officals are all f—ken rich, even if they grew up poor they are wealth af now
why would they give it all away when you keep voting them in? (Albo knows he's getting at least $600K per year in retirement at the tax payer's expense on top of his super)
This is essentially the issue MPs are over compensated they have no interest in a fairer system
I mean Albo is trying to tax other people with money more BAR politicans with his 3m dollar super tax hike
This isnt just a dig at Albo although he is a f—ken shit PM Rudd, Abbott, Gillard, Comminist Dan etc all milking the non means tested pension for life
Even the post 2006 gang are well compensated and have zero accountability for the shit jobs they do
They're incompetent dropkicks that have never contributed anything to society, they've created a system that only benefits their developer mates and their own corrupt actions and have absolutely r@ped the Australian public.
They have provided less than zero to the Australian public for their actions and the decline in living standards for every person that resides in this country, felt by all can be directly attributed to their career incompetence.
the decline in living standards for every person that resides in this country, felt by all
Not quite felt by all. Certainly not by the millions of new arrivals from the third world. From their perspective, their lives have been upgraded from the bowels of a filthy 18th century convict ship to platinum premium first class on a Saudi oil Prince's private jet. They can only wish Nirvana is as good. And they will be eternally grateful to Deva Albanese, for generations to come.
getting at least $600K per year in retirement…
Not "in retirement"…"in retirement from federal politics". He was first elected to parliament before 2004.
have you noticed how every Ex PM or ex MP get a cushy "ambassador" (or equivalent) role in another country?
Malcolm Turnbull, K Rudd.. - its all cronyism and corruption (all sides - left + right).
Even Dan Andrews and Bob Carr were recently at the all expenses paid vacay for the China Military presentation.
Dan dumb enough to take selfies with the dictators.
I wonder how the meetings went
"Australia can dig some dirt for you.. I know you want it…" ;)
"Iron, Coal - beef? - what you want, we got"
Their response:
"Yeah we know you have stuff, chill out and enjoy the parade"
Its all a big joke and we pay for it - I genuinely ask every single Australian to check your pay slip. See how much you "earn" and how much is taken in the form of taxation - that is your baseline (could be $30K, $50K, $100K or more taken from you. for what? - these guys!) - but it doesnt stop there! - for everything you spend on top of that, an additional 10% (GST) is taken from you for the incompetent government sycophants. There's that and there's hundreds if not thousands of hidden taxes you arent even aware of - all designed to take from you for their incompetent spending.
More people should be angrier - if you wonder why you cant afford a house - start there - the government taking from you and then needlessly wasting your money on things like that they spend more than they should. A prime example - that speed camera - the camera doesnt cost this - but the government spends $2 mill a year on it… per camera… its a joke! - I suggest more people create businesses and sell to the government and 100x your money - you as the business say its "creating jobs"…
@[Deactivated]: Spot on.
I was thinking the same, but couldn't be bothered writing it in a comment. Especially here on OZB most people have blinkers and are happy with whatever this government dishes out.
The PAYG tax money from your salary that the employer gives directly to the government is just the start. You don't even see it, so for most people doesn't even register. I bet soon enough the government will ask employers to stop showing the tax witheld on payslip so people will be blissfully ignorant.
Then they take even more from what's left, your take home pay. Exise, stamp duties, licence fees, GST. They even charge you GST on the fuel excise! A tax on tax!!!
And it is never enough. On top of all of that money they collect they run a budget deficit that costs ongoing interests and will eventually have to be reapaid, by your children or grandchildren.
If that doesn't infuriate you enough, now look at how they spend it 🤬.
What a genius.
No it would not
i reckon we get rid of income tax, but increase gst to 90%
Disproportionally hits the poor.
Disproportionally spares the extremely poor, who spend nothing.
So you think they live on fresh air? Everybody needs to buy something.
Id prefer a flat tax rate on income if its 25% or 33% seems once u start to do overtime the tax man takes it all.
Scrap limitations on super deposits as well.
Raise GST and lower income tax
But none the less my tax thoughts are my own and its impossible to keep everyone happy. What makes me happy will effect others
@Gros21
Id prefer a flat tax rate on income if its 25% or 33% seems once u start to do overtime the tax man takes it all.
It really seems some folks actually have no idea of reality. Right now.
Most full-time employed Australians are on a tax rate of 30%. (Income from $45k - $135k)
If you earn 'overtime' (most likely on wages, not a salary), you probably won't move to the next tax bracket. But if you do, it is still only to 37% (up to $190k).
So… the tax man is not taking it all. In fact, in a worst-case scenario for overtime (unless you are a KC earning $20k/day on a wage basis) you'd pay about 7% more tax than normal on the excess you earn.
I don't think that is a massive disincentive.
It seems there is a lazy perception or assumption (possibly a hangover from the 70's-80's when tax rates were higher - yes kiddies, tax rates were higher back in those good old days) that workers lose a large percentage of their overtime or penalty rates to extra tax.
Im over 135k so a flat tax rate would better for myself. Im over 190k with OT under without.
I prefer when the government PAYS YOU like 1% tax on every single transaction you do, win/win…
/s
Op thinks 1% is more than 10%. There goes our education system. you will get more votes if you join Paulin Hanson's party.
There should be zero taxes when the Government is inflating the currency via deficit spending and killing people's buying power
Let's be honest, the overwhleming majority (92%+) of the money supply (and therefore price inflation) is created out of thin air by the commercial banks every time they issue new loans. Fractional reserve banking has that effect.
I don't believe that to be true, though I certainly dislike fractional reserve banking as well.
Often banks get their money (dirt cheap) from the federal reserve (freshly printed).
The thing is, fractional reserve banking in Australia only really affects money through mortgages.
When governments deficit spend and slosh it out to dodgy suppliers and NGOs, that money is now competing with your salary for everything from building materials to groceries
bro needs a hard lesson on gst
Income tax was only ever introduced as a temporary emergency wartime measure in WWI.
These governments can't help themselves. Any of these changes they make will just expand how much money they extract from the worker. It won't be a net decrease for the average person
In before:
Oh em gee. Slippery slope arguments are invalid because just because.
The slippery slope is undefeated
@MindGrenadius
These governments can't help themselves.
Yeah. Like the governments of over 130 countries, and nearly all industrialised countries.
And yes, just because everyone does it doesn't necessarily make it right. But it does seem to have been a major plank of government income during the period of greatest economic growth in human history.
But it does seem to have been a major plank of government income during the period of greatest economic growth in human history.
I would dare to say that "the period of greatest economic growth in human history" has been primarily due to technological advancements.
Consumption taxes are regressive. They take a higher proportion of your income the less you make.
I dont understand how many people dont get how it works.
The goal is generally not to be fair .. the goal is help the people with low salaries that have an enjoyable relaxing life, and then penalize the people with high salaries that have wasted their life at uni and in the office
I’m one of the latter group and I completely disagree with your proposition. Whilst I was an Uni I did a bit of factory work over the Summer holidays to provide funds for the rest of the year. It was my experience that many of the people in the factories were clever enough to have gone to Uni but lacked the support required to do this. One of life’s great bullshit arguments is the rich work harder than the poor. If you have a rich family and go to a posh school you are much more likely to bring in the dough. Money begets money.
I'm one of the hardworking rich
…
There's lots of rich people who didn't earn it themselves
…
Tax the lot of them because there's no way to distinguish between them.
Am I close?
No but keep trying. You might get to the truth rather than your biased view.
Username checks out
or if everyone pays 2.5% of their wealth every year (not on income.., but total wealth/savings)
thats how rich will pay more and poor will have to pay less… !! a Just-system, guarantee there will no homeless in few years.
Current system is to protect rich people
I'm not agreeing or disagreeing with the tax proposal, but how did you reach those figures? It seems that to get to 1% of your wealth within 20 years would require over 20% loss per year? I'm just curious what I could have missed.
Better yet, just confiscate any private property immediately and make it illegal to own anything…
/s
OP's username checks out.
it doesn't as he's said previously he's 30
A "toilet" tax like in the old Roman Empire.
Bring back the Gladiators!
Careful Albo and Jim will want you at their Roundtable soon
N.B. they charge you a roundtable tax upfront if you want a seat
What a daft question - entry level day one economics stuff. Would result in low income groups paying a much higher % of their income as tax vs higher earners.
It's a little naive to think simplification would solve things.
As we have it, there are heaps of different taxes in our system, they are all just named completely different, from fuel excise, to stamp duty, it's all just taxes but creatively named by politicians, once you collate all of them together you'll realise a simple 1% taxation for each transaction probably won't really cut it.
Because,in short,taxes like that are terribly regressive and affect the poorer more adversely
Think of it like this:
A billionaire,and Joe Tradey both need 5 breads,milk and some vegemite to feed the fam,both pay 20% on the items (1% is like..unrealistic)
That might be a fair chunk of Joe's Wages,it's not even a blip on Billionaire's small change account. While it feels fair compared to the cost,it's far from fair compared to their relative incomes
But that’s how it goes… are you saying the billionaire should have to pay 1000% gst on the bread to make it fairer?
So each loaf of bread is $6 for Joe tradey and $6000 for billionaire bob?
Pretty sure billionaire bob paid more in tax last year anyway.
Joe Tradey paid f all.
But also billionaire bob represents… 0.1% of the population
Whereas Joe Tradey and his mates ripped off billionaire bob by overcharging for the work on his new riverfront mansion.
Then Joe Tradey realised that overcharging is fun and worthwhile, so now he rips off “rich boomers” too (but in reality they’re just grandparents on the pension and they want to die in their home where they raised their kids that they bought for next to nothing 60 years ago) the only money they have is on paper for the value of their home that is prized by rich developers and their labor mates… not what they actually have in their pocket. So now they have to sell…
Guess 2 wrongs make a right… somehow.
Riiiiiiiight
So if it costs $1000 to run the country,then all 100 people in Micronationa should pay $10 each
Including the disabled ones,the old ones and the children - otherwise (profanity)
It's weird how the wannabe billionaires feel it's unfair that they only earn millions per day passively and have to spend 0.000001% of that to subsidize others. It's literally why housing is such a mess right now,but yes MORE OF THIS IS GOOD?
Ask Albo, he’s owned over 15x properties.
But also, the government gets 600 billion dollars in tax paying dollars ANNUALLY!
I’m not a wannabe billionaire - I’m just aware of how things actually function.
The so called “billionaires” that you hate so prolifically on paper - are just that - on paper for a lot of them. If they cannot sell their shares in their companies for liquid cash, they don’t have wealth.
I don’t doubt that some people earn exorbitant amounts, however to demonise everyone that has amassed a significant level of wealth is something that isn’t necessarily productive.
What I can demonise however is the wasted potential of all the government spending.
Do you feel better off - no? The government is spending more than it ever has… so the amount of money spent isn’t the problem… wonder what it is..
But sure - your fictitious Micronesia is the solution, where everyone earns just “a dollar a day” (like a world vision advertisement)
@[Deactivated]: Lol,strawmanning now to try steer to a tax system that is demonstrably worse for the majority of people because you are aware of how things actually function?
Hahahahaha
Pull another finger wannabe
OP is a 30-something year old troll posting stupid topics and then refusing to engage
This behaviour is destroying the Ozbargain forums
Create your own…?
Will be no longer posting under this name, as now in the OzBargain Penalty Box.
Says single poster with thousands of "expert" comments
No thanks Gina.
This is why I'm against compulsory voting.
It keeps idiots away from ballot papers as they say to each other "it's not worth voting" or couldn't be bothered getting out of bed.
Tax reform should involve a complete overhaul of the brackets and support families so their combined incomes get taxed instead of heavily taxing 1 source of income.
all other tax concessions like selling owner occupied homes, capital gains, negative gearing is lost revenue. why should renters compensate for these?
high royalties on natural resources, like 80% would be beneficial too.
throw in land taxes for certain zoning if it makes sense too.
How about taxing the extremely rich and corporations who own the country, instead of taxing those who can't afford it?
OR fire half the government beurocracy, significantly slash exorbitant welfare.
But the pollies couldnt do that could they
This isn’t about the GST (mostly).
It’s about TRANSACTIONS.
For example share transactions.
"How Come They Don't Change The Tax System?"
How Come You're Not A Billionaire?
OIC - it's becos you have to pay tax - dayum mayum !
Taxing the high income earners would be a good start, that includes the politicians with lots of investment properties.
But also people that earn over $120,000 a year, the tax should increase not decrease at all.
ummm you have just described today's system…
Like a 60% tax on all that earn over $120,000 a year, the more you earn, the more you can help society, that is unless they are selfish and greedy…..
for starters $120k is a ridiculously low number to start at and once you get above that 50% mark it disincentivizes work and investment as working to give money to a hugely inefficient and wasteful government is idiotic and has a negative impact on society not a positive one.
I agree, here's the condition though.
We have a weighted political voting system - The more tax you contribute to 'help society' (as you've indicated), the heavier weighted and influential your individual vote becomes. Those who contribute nothing, or simply take from the system have the lowest weighted vote.
@helldoodle:
Yes. So what? That's a red herring. It's irrelevant to the Gallagher index and irrelevent to a discussion about improving the representativeness of our democracy.
For the lower house I want:
i.e. what we have for each state in the Senate, but for each of the lower house electorates.
It's the only way for Australia to restore represenative democracy. Our current system is no longer representative because just as many voters prefer third options as the two uniparty options.