2019 Budget-in-reply Address - Canberra

Discussion in 'Politics' started by Sackie, 14th Apr, 2019.

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  1. Simon Hampel

    Simon Hampel Founder Staff Member

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    While in principal I agree with the sentiment - there was a specific reason we have that policy. We are asking our parliamentarians to sacrifice their careers and businesses and represent their country with honour and dignity. The pension is assurance that they can give up what they previously had and not be any worse of for their service to the country.

    Of course, coming from the point of view that it is a privilege and an honour (and even a hardship!) to represent your country in parliament - it makes sense to pay them a pension.

    Coming from the point of view that politicians are nothing more than power hungry grubs in a boys club who exist for their own benefit and achieve nothing but to make our lives more difficult - then this no pension sentiment is completely understandable!
     
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  2. Simon Hampel

    Simon Hampel Founder Staff Member

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    The problem I see here is that the local government is ideally place to service the people who live within a defined area because they have unique needs which are quite different to those people living in other areas.

    The people living near a beach have very different needs to those people living in the inner city versus the outer suburbs versus rural areas. This is also the only level of government that most regular people could ever have a chance of representing the population under (I think that political parties should be banned at a local government level!!).

    I agree there is a lot of waste at all levels of government, but I'm not sure what the best model to fix it is.
     
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  3. geoffw

    geoffw Moderator Staff Member

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    I do feel sorry for people who work for the government in some capacity, who run for office, who have to resign their job just to be a candidate, most often without the chance of being elected.
     
  4. wombat777

    wombat777 Well-Known Member

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    Really? Of course this type of investing stimulates the economy ... and in the short term.

    I am invested in 4 resources companies that are collectively contributing (spending) over $1B in the WA economy in the next 3 to 4 years. They have quite significant upcoming investments in capital, beyond what they have already spent. Separately their working capital is largely made up from investments by retail shareholders ... and that working capital gets spent in the WA economy (employees of the mining firms, subcontract engineering firms, environmental consultants, contractors, etc, etc).

    One of these spent $14M of working capital last quarter (so say $50M to $60M per year) as they build their mine ... that working capital mostly comes from retail shareholders. A significant proportion of this relates to labour costs of some form ( whether it be employee salary/wages or subcontracted labour ).

    My property investments directly contributed $14k to the QLD economy in the last financial year (more than 85% of this to QLD small businesses - property manager, electrician, general maintenance, pest control, plumbing). I'm guessing $20k for the current financial year because of significant maintenance costs. This excludes interest, accounting fees, insurance and other costs that contribute to the economy.
     
  5. Simon Hampel

    Simon Hampel Founder Staff Member

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    Yes, but that money doesn't just sit under a mattress doing nothing.

    It either gets deposited into a bank, gets held in assets (real estate, gold, etc), or gets invested in businesses.

    Don't forget that much of the "wealth" of the extremely rich is actually only paper wealth and tied to valuations of businesses they are invested in - it is not unproductive.

    Indeed, I would say that other than sitting under a mattress, money is never unproductive - even if you just use it to build new mansions for yourself or buy sports cars. Those things don't build themselves!

    I think there is merit in investigating a flat tax rate of 30% - and perhaps even abolish deductions completely. Would make tax returns simple and get around the problem where people are able to reduce their effective tax rates to zero.

    Get rid of negative gearing, get rid of CGT, and everyone (except the very low income earners) pay 30% tax on all income and capital gains. Simple.

    I have no idea how that would affect tax revenues, or what the likely consequences might be in other areas - but rather than adding another 1,000 pages to our tax rules, let's pull most of them out!?

    Just a thought bubble.
     
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  6. TSK

    TSK Well-Known Member

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    Last edited by a moderator: 14th Apr, 2019
  7. skater

    skater Well-Known Member

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    Well.....I can't answer for you.....but I'm of the opinion that they are nothing more than money & power hungry grubs in a boys club existing for their own benefit.
     
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  8. TSK

    TSK Well-Known Member

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    Another paper. http://ftp.iza.org/dp3267.pdf

    If a flat tax system really worked every government would be on it. Many of the governments that have one are in Eastern Europe with poor ability to collect taxes in the first place.

    The issue of bracket creep and works really only impacts people of lower wages and it’s because of loss of social welfare payments. For people on higher wages that choose not to work more, there could be a multiplicity off reason: one that is big for me is, impact it has on personal life is just not worth it - when I die, time working and high stress, is not something I’ll wish I did more of.
     
  9. TSK

    TSK Well-Known Member

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    Maybe in coalition given their lack of women....ALP, Greens and One nation would appear otherwise.
     
  10. Scott No Mates

    Scott No Mates Well-Known Member

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    No, they're just paying the same % as everyone else.

    Even under the gst regime, you can reduce the amount of tax collected by selecting untaxed foodstuffs.
     
  11. wombat777

    wombat777 Well-Known Member

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    The proposal in the budget isn’t a completely flat rate of tax but a simplification of the tax brackets.

    A7E078B5-907E-455C-81AB-47A2E52C4A1F.jpeg

    Tax free threshold is currently $18,200.

    Chart was in this article:

    Federal Budget 2019: Top tax rate to be 30pc for most

    Try googling the title if you hit a paywall.

    Have never subscribed to AFR. Too expensive.
     
  12. TSK

    TSK Well-Known Member

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    Food never should have been excluded and unless you’re into raw food movement you’ll need to cook it...gas or electricity which does attract GST. GST has a much larger impact on those with lower incomes.
     
  13. TSK

    TSK Well-Known Member

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    They use avg wages...already lost all value imo. Median wage should be used.
     
  14. Scott No Mates

    Scott No Mates Well-Known Member

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    @wombat777 I'm Sslightly confused by the last bit of the graphs - if incomes currently above $180k represent 5% of punters, how can increasing the threshold to $200k then represent 6% of the same group?

    Agreed.
     
  15. wombat777

    wombat777 Well-Known Member

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    They are two different time periods.

    First is 2017-18
    Second is 2024-25

    There would be a different level of total tax receipts in 2017-18 versus 2024-24.

    The chart is just saying where the proportion of overall income tax receipts are expected to come from based on analysis and modelling for each point in time.
     
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  16. Scott No Mates

    Scott No Mates Well-Known Member

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    Thanks (who looks at the details?)
     
  17. Sackie

    Sackie Well-Known Member

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    Really informative comments. You guys way more clued up so its interesting to read your take. I just feel our current tax system is broken. We need change. Something alot fairer to ppl who earn more and less complicated. People need more incentive to earn more without fear of having it taxed to the point where you feel what's the f'ing point to put in the effort when its only going to get given to others who likely put in alot less effort than yourself .


    I'd like a tax system which encourages hard work and sacrifice for commensurate rewards. Not be punished for earning alot more.
     
    Last edited: 14th Apr, 2019
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  18. kierank

    kierank Well-Known Member

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    Totally agree.

    I come from an era where, for each extra $ earned, the Government got more than I did :D.

    What a great incentive to work hard and get ahead :eek:.
     
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  19. Sackie

    Sackie Well-Known Member

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    It's actually sickening if you think about it. WE sacrifice so much to try and get ahead. And those clowns in Canberra just waste so much of it away. TBFH I'm just sick of paying so much tax disproportionately to others simply because I make more.
     
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  20. Sackie

    Sackie Well-Known Member

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    @Perthguy any take on our tax system? flat tax? good or bad
     
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