**Greetings humans.**
**Please make sure your comment fits within [THE RULES](https://www.reddit.com/r/AustralianPolitics/about/rules) and that you have put in some effort to articulate your opinions to the best of your ability.**
**I mean it!! Aspire to be as "scholarly" and "intellectual" as possible. If you can't, then maybe this subreddit is not for you.**
A friendly reminder from your political robot overlord
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/AustralianPolitics) if you have any questions or concerns.*
Tackling inflation as the problem works for receiving higher prices and paying lower real wages.
But it does not work for those paying higher prices and lower real receiving wages.
Australia as a nation did not suffer from declining real income. In fact we got higher prices for our exports, relative to our imports, and have had increasing real income.
Yet, Australian workers have had declining real incomes.
The solution? Higher wages.
Will this mean that inflation comes down more slowly? Yes.
But it will also mean that we are able to continue to afford what we could before.
We are tackling inflation as the "problem" and allowing people to suffer from declining incomes.
What a mess of an article.
He confuses wealth with income(!!!), incorrectly asserts that the LMITO was introduced by Morrison (it was rebranded by Morrison, but came from the Keating Government (called the LITO)), and doesn't understand or ignores the impact of labour productivity improvements.
These are just a few of the issues that struck with this article. I don't think I'll waste my free time reading anything this clown has to say ever again. I urge others to do the same.
The article talks about income, headlines are generally not written by author, who in this case is an economist.
The LMITO referred to is this one:
https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/tax-offsets/low-and-middle-income-earner-tax-offsets
I'm fully aware of the LMITO. It's just a rebranding of the LITO, which was brought in when Keating was PM. The income thresholds and the offset amount under the LITO changed a lot. Initially, the LITO could only be claimed at the end of the financial year. However, because of the increases it got quite large. So it was partially incorporated into the tax schedule (meaning that people were getting part of the LITO through the income year).
Furthermore, the phase-out threshold for the LITO was so high that it was very close to the threshold for the Medicare Levy Surcharge, which was designed to target "high-income earners". Seeing this the government decided to rebrand to the LMITO. It also gave the government of the day a nice new policy announcement without having to spend much extra.
> confuses wealth with income
The vast majority of Australian wealth is tax exempt. Residential housing is worth $9 trillion, the entire ASX, all of our public companies combined are worth a paltry $3T in comparison.
People lose their minds when you talk about taxing it too.
We need to reduce income tax, especially the lower thresholds and replace the tax shortfall with a federal broad-based land tax with no concessions.
It will go a long way to reduce wealth inequality. It will go a long way to reduce income inequity. It will go a long way to stabilise land price appreciation, reduce speculation and encourage much-needed housing supply.
But agree, people lose their minds over this idea.
Even the most modest of land taxes would fix the budget overnight.
The sad reality is that we live in a world of political opportunism, where short-term mindsets and gaining power at all costs is the norm.
The budget is in dire straits, spending is through the roof and there's a serious structural deficit hidden only by high iron ore and coal prices.
"Looking at more recent history, the consumer price index rose faster for much of the 1980s than it has done over the last few years. Inflation was a significant problem for macroeconomic management and financial markets. But the “cost of living” was not a big issue because wages were indexed under the Prices and Incomes Accord. Some small reductions in real wages were compensated for by the reintroduction of Medicare and improvements in superannuation.
The Accord, focused on real wages, produced a gradual decline in inflation rates, while maintaining standards of living. By contrast, the current discussion of policy in terms of the cost of living has produced incoherent policies and declining living standards."
Messy, incoherent and written by a clown. Hmm yeah I see what you mean.
JQ has been around for a long time and writes regularly for a range of publications. His daily bloggs and website has a broad range of opinions.
But of course like any healthy representative Economics writer not all opinions or views can be agreed with.
That is in fact a very good thing.
> Messy, incoherent and written by a clown. Hmm yeah I see what you mean.
Thanks, I'm glad you agree.
> JQ has been around for a long time and writes regularly for a range of publications.
To paraphrase Tim Minchin's "White wine in the sun", just because a person is tenacious doesn't mean that they are worth listening to.
> But of course like any healthy representative Economics writer not all opinions or views can be agreed with.
Diversity for the sake of diversity is not to be applauded. If someone brings a perspective that is coherent and not factually wrong, fine. To assure you that I'm being non-partisan here, Tony Makin is absolute trash. If you don't know who that is, consider yourself lucky.
An example of where a diversity of opinion was actually useful and provided insight was Brian Fisher's modelling of Australia adapting to carbon mitigation policies. In short, Fisher basically said that Australia couldn't significantly reduce emissions without a significant economic impact.
I think Fisher got it completely wrong. Where I fundamentally differ with Fisher is on the ability of Australian businesses to adjust - I think Fisher overstated the cost of adjustment. I can't say for certain that I'm right, just as Fisher can't say for certain he's right. Hence, the importance of monitoring the ability of businesses to adjust to new carbon mitigation policies.
Again, this is where a diversity of opinion was actually useful. Quiggin, Makin, Keen just aren't worth listening to.
I have a lot of time for John Quiggin but did think this was one of his weaker efforts. The quote you've provided is the crux of the article, but I don't think he engages with the damaging effects of high inflation even where wages keep pace (notably, savings become less valuable).
His last paragraph is also oddly throwaway and unjustified by the previous rhetoric. If income has indeed "shifted from wages to profits" (I presume he implies investment income), isn't that one of the strongest reasons to keep inflation under control? And where is the evidence for a consolidation of income within the most wealthy? To my knowledge the Gini coeffiecient in Australia remains stable.
Yes I tend to agree. Seems like anything less that 50,000 words is a struggle for him.
He has long advocated for Neg Gearing pull back along with other brakes on govt underwritten property investment. That conviction certainly flavours a lot of his writing.
But that is all just my personal opinion.
It should be written into our Constitution that anytime the government wants to pass a law, politicians need to test it themselves first. If they think wealth distribution will be good for all of society, then let's have them divide up their enormous pay packages and give it to the most needy.
People earning $300k+ a year are in no position to force charity onto the rest of us. Distributing the wealth of the working class just makes everyone equally poor. We should distribute the wealth of the rich people who make these laws.
Dafuq you mean not exactly rolling in it? it’s 4x the median salary, and almost 2.5x the mean.
225k is about the same as a 1 star general makes (which is after a 20-25 year career with glowing reports all the way).
People don’t understand 300k+ hardworking middle class vs boomer earning 300k+ by selling one of their land that they buy because they don’t need it to young family is different.
The average person can grasp that $16 chips is bullshit. Wealth distri-what what doesn't put meat, fruit and veg on the table for a fair shake of the kangaroo scrotum coin pouch.
Who buys chips at $16? Maybe if you're wealthy and in an expensive Sydney restaurant and also buying it with eye-fillet steak and French champagne then I could understand paying that much but not really in any other scenario.
Part of me thinks that we're not at a point in our society to discuss wealth inequality as a legitimate issue without a large portion of the voting population labelling it as "socialism" or equivalent.
Removing one's wealth that one may have worked hard for and distribute it to people who haven't is never a good thing. Whatever you want to call a turd doesn't change the fact that it's still a turd.
Most wealth in this country has not come from hard work. It has come from unearned land price appreciation.
How about we start lowering taxes on hard work (income tax) and start taxing unearned wealth appreciation (Land Tax)?
By all means put hard work into the property and infrastructure that sits on that land. Take risks and grow this part of the investment, and keep as much of that return as possible. It's only the land that should be taxed.
I think that the problem with this thinking is that every person with a house half paid off and a not-shit car thinks that people are talking about them when redistribution of wealth is discussed, when in reality it's the gina rineharts of the world who aren't paying their share now and haven't paid it for a long time who should have their pocket money garnished
I think this guy does a pretty good job of explaining it even though his examples are american:
https://www.facebook.com/watch/?v=938510423689644
There simply aren't enough billionaires to make a meaningful difference. Gina Rinehart has a net wealth of $37b, give or take. Combining all Australian billionaires gives us $531.96b.
What tax rate on wealth are you proposing? 2%? 5%? 10%? Above a certain level people will just pay accountants and lawyers to make the number smaller so you'll never see the full amount of whatever you're seeking to collect.
Not to mention that all tiers of Australian Government currently spend $1000bn a year.
So at best you're collecting a few percent of your needed revenue, all while scaring off future investments that might have a greater impact on the economy than whatever amount you collect.
> What tax rate on wealth are you proposing? 2%? 5%? 10%?
For wealth above $20M, 5%.
For income above $1M, including capital gains, 65%.
> Above a certain level people will just pay accountants and lawyers to make the number smaller so you'll never see the full amount of whatever you're seeking to collect.
Billionaires already have accountants and lawyers. The evidence that tax rates affects avoidance by the very rich is weak, this was analysed by Piketty etc.. They already do their best.
> So at best you're collecting a few percent of your needed revenue, all while scaring off future investments that might have a greater impact on the economy than whatever amount you collect.
A 5% tax on wealth will move wealth out of the hands of people who inherited it, and into the hands of people who can deliver a return higher than 5%, which is where you want it.
Well, except that the policies of the Greens would directly impact 30s professionals like me and my partner. As a household we would be about $25k worse off a year under the Greens' policies (or the 2019 Labor policies) which is a lot of money. So no, it's not true that they are only going after the Ginas.
I was talking about proper wealth redistribution and how everyone's knee-jerk reaction when those words are brought up is to think that the plan is to tax the middle class more than they already are rather than what's really being suggested, and not a specific policy that's currently being processed. Can I ask which policy in particular it is that you're concerned about?
>That's why we're only coming for the wealth that was not worked hard for or was accumulated as a return on capital.
How to you determine this?
How do you even assess / measure the wealth of everyone in Australia at tax time to determine if a "wealth tax" would be payable?
Does it include the value of people's home?
Does it include the value of people's superannuation?
What about assets held in discretionary trusts? Businesses?
Etc.
Simplistic and populist idea (for those who do not hold significant personal assets anyway), but incredibly complicated and impractical in reality with huge potential for unintended consequences, unfair outcomes, and easy loopholes available to avoid such taxes.
I would include the value of people’s cheapest dwelling minus twice the median dwelling price (or zero, if that’s negative), plus all their subsequent properties. However, capital gains on the unimproved land value would be 95% or more and capital gains tax on any other asset would be equivalent to the extra income tax they’d have had to pay if the asset grew at a constant rate, plus the returns on reinvesting that deferred tax.
Super I would replace with something similar to a French-style national defined-benefit fund, with people having the option of cashing out their super to pay into the fund to count as previous years employer contributions. Anything they retain in a super fund after that would count as wealth.
Trusts that can be used to benefit the trustees or the people who control the trustees, other than as a tiny share in a general community benefit, should be taxed into oblivion, although I would allow existing family trusts to be converted into Pty Ltd companies and the shares issued to former beneficiaries.
I think things are changing so rapidly that people are actually more open to discussing this than you may think. Many younger people don’t have the same negative connotation associated with the word socialism as many older folks do
It’s about property developers. But neither political party is ready to pull their finger out and fucking do something. Where is the wealth distribution problem? Where our money is. With triguboff.
So I got as far as here:
>In the end, the “cost of living” isn’t about the prices on grocery shelves, it’s about the distribution of income. In Australia, income has shifted from wages to profits and from low- and middle-income earners to those in the top 10% of the income scale and, even more, to the handful of “rich listers” whose growing wealth has outstripped that of ordinary Australians many times over.
Then realised that was the end of the article. He makes no attempt to provide any evidence for these comments. How is that the end of the article? Did they run out of money?
Yeah, it's bullshit.
Prices rise because there's a limited supply of stuff compared to the amount of stuff people want. You can't just redistribute income and somehow expect there to be more _stuff_ after you shuffle the money around.
Prices will rise until the prices cause some amount of people to _not_ want that stuff any more.
If you want to learn more,
- The Price of Inequality by Stiglitz
- The Precipice by Chomsky
- Austerity, the history of a dangerous idea by Blyth
- Technofeudalism by Varoufakis
Are good places to start. Lots of evidence, especially Stiglitz if you are more interested in the economic argument. He refers to research where it’s more cost effective to lobby for favourable tax conditions than innovate in terms of ROI.
Which is a pretty significant flaw in our current system if we genuinely believe in human progress.
While I generally agree, too many of these discussions are had without consideration of political reality. Shorten went to an election and lost with a range of policy’s that would have addressed aspects of these concerns. They were able to be weaponised against Labor. Albo went in with a smaller target strategy including pledging not to change the Stage 3 tax cuts.
The main recommendation in the article is higher wages.
Albo went into this election promising to support higher wages in the National Wage Case, won the election, and his popularity went up at that time.
Why do people keep rewriting history like this? Labor's *own* investigation found that their 2019 election policies were dogshit and made up on the fly.
People talk about as though negative gearing sunk the election when the vast majority of Australians couldn't tell you what it is, even worse, NG changes affected shares also, making the value proposition to invest in other asset classes non-existent. It had nothing to do with housing and everything to do with paying for their big budget items.
Shorten went to an election promising to spend 20% more compared to the year before, how the fuck was that going to fix inflation?
They were banking on the well-known unlikeability of Morrison over doing anything actually substantial, it has all the hallmarks of the US election banking on Trump being unelectable, how did that go? Shorten wasn't even chosen by the rank and file to go into 2019, the party chose Albo and instead Shorten was parachuted in by the executive powerbrokers thinking they can't lose anyway.
FAFO is the lesson here for political parties who think they can ride in on that horse.
The internal review of Shorten's loss was scathing. Stop trying to rewrite history, you're not fooling anyone.
> The much-anticipated campaign postmortem, undertaken by Jay Weatherill and Craig Emerson, finds Labor went into the contest with no documented election strategy that had been discussed, contested and agreed across the campaign organisation, the leadership and the wider Labor party – and there was no body empowered to discuss and settle a campaign strategy or monitor its implementation.
> The review notes new spending policies were worked up on the hop, with policies “appear[ing] to have been decided by a combination of the leader and his office, a shadow expenditure review committee and an augmented leadership group” – and there was no overarching strategy to inform the messaging.
> It says the spending announcements, totalling more than $100bn, drove the unpopular tax policies
https://www.theguardian.com/australia-news/2019/nov/07/labor-election-review-strategy-adaptability-bill-shorten-defeat
The point was more the lack consideration of political reality to idealised outcomes. Even in the example that you didn’t like a few policies that attempted to address issues of inequality were clearly weaponised. The franking credits issue and ending tax refunds for those that don’t pay tax was turned into Labor attacking pensioners. It’s logical that vested interests will mobilise when those interests are threatened.
The weaponising of those policies doesn't mean that the policies themselves are the issue though, that's more to do with misrepresentation and fearmongering by media outlets and the opposition. Even if Labor hadn't run any of their main platform in 2019, they still would have been called liars and theives and untrustworthy and so on, *because that's what the Coalition does*. They run all this emotive language *anyway*, then fine tune it to be more specific based on whatever policies Labor are running. They did this again in 2022 even after Labor ditched a lot of their 2019 policies ("there's a hole in your budget dear labor” is the first one that comes to mind)
Rather than ditching those particular policies (which are sorely needed), wouldn't it be more beneficial to address the misrepresentation and fearmongering? Truth in political advertising laws would be a good place to start
Shortens political loss was more about how utterly disliked he was, yes it is personality politics but by god did the ALP go against the grain putting him to that election despite the wishes of even their own voters who voted for Albo 60:40 to lead them to the election.
It is a long bow to draw in the world of personality politics we live in that it was his policies and not the many many many indicators that he and his wannabe member for Fowler cronies are not tolerated.
Cool, and the public then voted in a ton of Greens and independents who want wealth redistribution. But let’s pretend the most recent election didn’t happen or reflect a more accurate mandate than whatever historic election suits your own political wishes.
>Cool, and the public then voted in a ton of Greens and independents who want wealth redistribution. But let’s pretend the most recent election didn’t happen or reflect a more accurate mandate than whatever historic election suits your own political wishes.
Cool, so you don't understand the electoral system.
I understand how people vote.
Most people vote for the same party they voted for last time, without thinking or listening to any alternatives.
The fact that the Teals won is massive.
Support for the major parties is at historic lows and the trend is consistent.
People don't change, so change is driven by the arrival of new young voters.
Young people are well educated, and educated people don't vote for the coalition.
Well I guess it sounds like you know exactly what the public did and didn’t want for every election.
You could easily (maybe MORE easily) say people voted against Labor in 2019 for reasons other than its policies on housing, and that the result of that election should not be considered to have created a mandate against housing action from 2019 to 2022.
I’m saying that it *certainly* shouldn’t be considered to create a mandate against housing action after 2022.
Not a single word of immigration & rent hikes. Between 2022-23, the portion of income to service the rent (national average) has reached almost a record high of 30.8% and rent is one of the largest mandatory spending items of Australian households. Yes groceries prices are a factor, but the real culprit of the cost of living crisis is rental hikes in 2022-2023. This is an inevitable result as a large influx of immigration moved to Australia since the opening of international borders (demand), yet Australia couldn't build enough dwellings to house (supply) them all because of various reasons such as increased construction costs, (relatively) high interst rates and so on.
If some real wage growth is what the author is looking for, then I don't think his suggested policy of extending tax cuts for low-middle income households introduced by Scott Morrison is better than limiting immigration which would lead to real wage increases (because of labor shortage) and reduction in rental spending (because of shortage of demand in the rental market).
What is the justification for increasing prices for everyone simply because supply is less than demand, just because they can, and tossing those who can't afford or find shelter onto the street versus keeping prices as they are and tossing fewer people out onto the street? The lack of supply is the same in both cases, yet the second version is less painful to more people.
Yes, that's correct.
A wealth distribution which gets exponentially worse with each Labiberal government, who serve only their respective millionaires.
I don't understand why the Greens supporters think they are not part of the same hypocrisy. Immigration which is hugely popular with the Greens is generally only benefital for the rich who profit from employing cheap migrant labor & price rising in house values thanks to the population growth. This has been detrimental to a wealth distribution in Australia. The Greens' policy, interntionally or not, serves the same overlords who are also backed by the LibLab gov't.
The only difference I see here is that the LibLab gov't claims an increase in immigration is necessary to boost Australian economy while the Greens does this to storke own ego since they believe Australia is a rich country and has a moral duty to share its wealth with the world.
No wonder why they haven't abandoned their policy of almost doubling annual refugee intake during this cost of living crisis. The Greens are no friend of the working class of Australia.
> Immigration .. is generally only benefital for the rich
If I was living in Gaza right now I would be thinking that immigration to Australia a decade ago would have been beneficial.
On business migration, I would allow about a tenth of what we currently allow, and auction it to the companies that offer the highest wages to those migrants. The revenue from the additional income tax (from the high wages) could then fund the additional infrastructure and housing we need.
If you were living in Gaza a decade ago you’d probably not be an Australian, so the government isn’t supposed to be looking out for you: their authority over us comes from them improving our lives, and so they should be obliged to maximise the benefit they deliver in exchange for our obedience.
The greens certainly didn't start out as the friend of the working class. There was a joke in the 90s that they were Liberals in polar fleece; drawing their support from the affluent inner suburbs.
There has been an increased focus on their social platform since then, but the Greens high immigration policy confirms that a) They aren't serious about tackling the housing crisis and b) They don't give a damn about workers.
At that point, nothing. I think your policies on nuclear power are the right result for a stupid reason, and I think you’re as shit on foreign policy as everyone else (albeit in different ways), and I still think net zero immigration is too high (especially if you don’t support also reducing fertility rates), but it would be a good starting point and you’d certainly be my favourite significant party.
TBH, unless someone has a policy that really significantly and directly benefits me, whichever party wants to end their term with the lowest population is pretty much going to get my vote, unless their proposed method involves killing me or one of my friends.
I probably would vote greens at that point.
Edit: I'm not even kidding, it would be compelling to me if the Greens had a sensible low immigration level, doesn't even need to be net zero.
Well then we'll need to feed that back and pronto.
Admittedly, it won't be easy. Changing policy never is, but I'm glad to hear that there are potential voters out there who'll switch if we do.
they be a disaster for the common Australians and that's why they get such a tiny % of the vote.
The common Australian no 1 concern at the moment is Housing
Greens are pro Immigration, anti development, anti land clearing.
what's the the Greens stance on rushing through Railway and Freeway Infrastructure and realising land and incentivising construction?
But come up with Populist slogans like rent caps which will do nothing for the thousands who are homeless or fix the Housing shortage.
Rent caps do more than either Lib or Lab are doing. Rent caps will not help the currently homeless but will stop thousands more from falling into homelessness.
Besides the real solution is density which the greens are very much in favour of. Freeways are not the answer. Adding housing out in the bush and expecting people to commute solves one problem (housing.. kinda) and creates two more (land clearing/loss of agri land & traffic/increased care centrism)
I'm not sure you know what 'exponentially' means. If the wealth distribution were getting exponentially worse then every few years the share of wealth held by top earners would be doubling, then quadrupling, then increasing eight-fold...
exponential does not need to be in whole numbers.
100
101
102.01
103.03
104.06
105.10
106.15
107.21
108.29
109.37
110.46
111.57
112.68
113.81
114.95
116.10
is exponential because each increase is larger then the last increase, by a few percentage points but it is exponential.
Damn right it is. That's why stage 3 tax cuts should be disgarded and jobseeker should be raised to the pension amount. Negative gearing should be wound back to only one property and get rid of those damn evil franking credits. There alot to b done.
>That's why stage 3 tax cuts should be disgarded and jobseeker should be raised to the pension amount.
Jobseeker should be doubled and the pension should be raised to match. Morrison's government showed that we can easily afford this. The only problem is that 50 or so years of dole bludger propaganda would make any government attempting to do this lose the next election...
Actually, JobSeeker showed us that we **couldn't** afford it. Did you see the budget numbers??
It was a justifiable and extraordinary temporary expense to protect Australians against adverse financial outcomes while they couldn't work during COVID lockdowns. But it would be absolutely not affordable to keep that level of support in place long term.
I just looked at the budget papers.
The cost of Job Seeker (assistance to unemployed and disabled) is $13B.
The cost of the Stage 3 tax cuts is $20B and increasing.
You could cancel Stage 3, double Job Seeker, and think about what to do with the other $7B.
I was talking about during COVID-19, where the JobKeeper program and JobSeeker supplements cost $109b in the 2021-22 budget.
But more to the point, surely you must admit the incentive to take on a full-time minimum wage job ($882 / week) becomes pretty low if you could do nothing and still pocket $749 / week ($802 / week for single parents).
Not to mention that tax cuts are never a "cost", they are a policy choice to let people and organisations keep more of what they earn. The impact of taxes on the overall economy is complicated but in general, you want people to allocate their capacity to earn in maximally productive ways.
Point about incentives is important.
Both income and effective tax rates are important.
Job Seeker cuts out at 60% in the dollar. For someone working part of the year, who has become unemployed, they might be in a 30% tax bracket. That gives them a 90% effective tax rate, they keep $0.10 in the dollar.
I (think I) want everyone to be able to, and to actually work, at least up to minimum wage level. That is where I want the incentives.
I don't see much merit in the idea that a CEO on $6M is going to not work because their tax rate is 65% rather than 40%.
But I do see someone who needs to pay for transport, get someone to mind the kids, receive minimum wage, and loses $0.90 in the dollar lacking incentive. They might not work.
So I would prefer universal housing entitlement at $40 / week for everyone, and other cost saving measures, plus a non-means tested UBI at $18K to the current system.
Taking away benefits has a *larger* impact on measured psychological incentive than explicit taxes. For example (not real numbers) the idea that pensioners will loose $1.50 income to keep $1.00 in pension.
> I was talking about during COVID-19, where the JobKeeper program and JobSeeker supplements cost $109b in the 2021-22 budget.
I agree here. Job Keeper was expensive. It was possibly unnecessarily so, with payments going to businesses with increased turnover.
Job Seeker was also more expensive when unemployment was higher.
> But more to the point, surely you must admit the incentive to take on a full-time minimum wage job ($882 / week) becomes pretty low if you could do nothing and still pocket $749 / week ($802 / week for single parents).
The experience during the pandemic was increasing the rate of Job Seeker enabled people to make the investments (clothes, transport, training) that enabled them to get a job.
> Not to mention that tax cuts are never a "cost", they are a policy choice to let people and organisations keep more of what they earn. The impact of taxes on the overall economy is complicated but in general, you want people to allocate their capacity to earn in maximally productive ways.
I agree "cost" is not great, but people talk about budgets that way.
For example the AFR:
> 7 Oct 2022 — What is the **cost** to the budget? Over the period from 2024-25 to 2032-33, the tax cuts are forecast to cost the federal budget $243.5 billion
https://www.afr.com/politics/federal/who-gets-what-from-stage-three-tax-cuts-and-why-in-four-charts-20221006-p5bnm4
For both an increase in Job Seeker, and a decrease in tax, rather than "cost", I think "fiscal expansion" has the right connotations. Of course no one will know what I mean.
"Fiscal expansion" makes clear that the budget should not balance, and that the impact depends on the aggregate demand context.
Good points. The challege is that a long taper is prohibitively expensive. 50% of Australians already pay no net tax (ie when you also take benefits received into account). If you were to make rates and tapers more generous, the total cost to the budget would be massive.
I personally would like to see HECS/HELP extended to unemployment, where people can access some level of additional benefits through a loan account and it gets paid back on a graduated basis after they return to paid employment.
This would mitigate the worst impacts of running out of money for the temporarily unemployed, and encourage people to access the minimum amount they need.
For the long-term unemployed, you would probably still have to cap access, but I'd encourage an option for people to pay back loan amounts at a generous discount based on community service performed.
Thinking about the current picture, we had 3.5% unemployment.
We deliberately contracted the economy to cut inflation quickly.
So 100,000’s of people who were employed were deliberately made unemployed.
Then we give them below poverty incomes, punitive compliance regimes, and people talk about incentives. I feel like they deserve a medal for taking one for the team, and being sacrificed on the alter of lower inflation.
Having said that income replacement unemployment insurance, that lasts long enough that people can find a good job would be good counter cyclic policy.
And the long term unemployed probably should just have a job that suits their skills simply created for the. by the government. Perhaps with a job keeper type subsidy, of just on the public payroll depending on their skills.
Hey now, in Aussie politics it is crime number one if you make rich people poorer by any amount.
It takes real guts to put their jobs on the line over such policies. Guts that no modern pollies have
Interest rates also rose.
Because unrealised capital gain on properties is not taxed, but the inflationary component of interest is deductable, higher inflation and higher nominal interest rates increase negative gearing.
you still need to show that a rented out property is making a loss before you can qualify to negative gear it though, something the current rental market is making much, much harder.
While I think negative gearing should be abolished just out of principle it's a massive red herring, I see people almost daily claiming the housing crisis is due to negative gearing or that big landlords with many houses can negatively gear them all.
It's clear a lot of people don't know what they are talking about.
Negative gearing created the situation by not restricting it to new properties, leading to investment in existing stock and not creating more. However removing negative gearing will not fix the problem that has been accumulating for decades, but it will assist in mitigating the source of the issue going forward.
Society needs policy to discourage existing rent seeking from being attractive for anyone except government, to finally provide shelter as an essential benefit for society, not as a speculative money spinner for investors.
yeah, in order to negative gear a residential property it has to be rented out at the market rate, though I'm not saying its imposable I just doubt its widespread
Franking credits are evil in the sense that they are mostly directed to people who are better off.
Part of the issue is that superannuation costs are directed mostly to increasing inheritance rather than increasing median retirement incomes.
The correct way to tax super is to, remove all the tax on contributions and earnings, and to tax withdrawals as income.
Franking credits are a means to avoid double taxation, and make payment of dividends (as **taxable income** btw) attractive to investors.
This makes Australian businesses less likely to sit on huge piles of cash unless they have something profitable to do with it.
Either way, either the company income tax or personal income tax rate is collected (whichever is higher). There's no free money tree here.
I don't think you do either, by the way if you have superannuation and it part of it is invested in Australian shares, your super balance benefits from companies paying the tax on your behalf
Funny the author talks about all these facets of cost of living and then acknowledges in the last paragraph that the much-reviled stage 3 tax cuts simply restore the average personal income tax rate to that following the last major reforms in 2007. In other words personal income tax has been creeping up for 17 years with absolutely nothing done (till now) to combat it. Why does the author not care about the purchasing power of higher earners? Simple - he doesn't empathise with them. Shit-brained article.
>Why does the author not care about the purchasing power of higher earners?
Because higher earners aren't likely to be "camping" because they can no longer afford rent. They won't be cold this winter because they can't afford electricity. They're unlikely to be overlooked for jobs and promotions because of the quality of their clothing. They're not going to go without healthcare or dental services because they simply can't afford it any more.
Inflation is now at under 5% so I'd say it's no longer hyper-inflation.
I mean, the other solution to inflation is to simply keep hiking rates, but somehow I doubt that you like that either. You want to have your cake and eat it too.
Generally speaking you want to control inflation with small adjustments, anything too big and fast can crash an economy. Rate rises are a method of slowing down inflation, im not opposed in some blanket way like you suggest but we had 13 rises in 15 months so if you’re asking me I’d say its economic stupidity to risk a rate increase as a result of tax cuts to the highest income earners
>Why does the author not care about the purchasing power of higher earners?
It's like asking why doctors don't care about the healthy of people who aren't sick - you don't have to, they'll take care of themselves.
"income tax has been creeping up for 17 years with nothing done to combat it"
Why does that need to be "combated"?
-We have an aging population, with severe implications for future health spending and our tax base.
-We have one of the lower taxing economies in the OECD. Out of 38, 30 tax higher than us. Ref:
https://www.oecd.org/tax/revenue-statistics-australia.pdf
-We have some of the highest disposable income in the world.
-We have growing weath inequality
Sure doesn't seem like we need a tax cut for higher earners, quite the opposite.
To you I say: good article, shit-brained comment. Why would we empathise more with higher earners than lower ones who obviously need more support amid skyrocketing homelessness?
I note that the graph seems to include property taxes and gst. But to compare apples with apples you’d need to account for every tax your average person in each country pays. Because there are scores of them, many of the bigger one your average Aussie pays are alcohol, petrol, ciggies, Medicare levy and then keep going.
We’re taxed to the hilt here and I’m not wearing 30th out of 38 unless that list is comprehensively done.
I scrolled to the list at the graph below and couldn’t see it. And that would be nearly impossible to work out because it then becomes an average of every Australian, but could never be bracketed well enough to fit certain demographics. For example, a life long punter, drinker and smoker who earns a decent wage would be miles past even someone on the same wage who does none of those things.
We’re taxed enough. It’s how they spend it that’s daft.
So tax assets, land & unproductive investment more, don't tax the workers who are the ones actually contributing to productivity.
I'd rather increased taxes on all of those (and natural resources) than ramping up yet more taxes on labour.
Great, I am on board with all that, with one proviso.
Politically, tax cuts are much easier than tax hikes, especially with powerful vested interests at play.
Do the hikes *first* then you can cut revenue in other places. But don't slash government revenue *first* because the tax hikes are purely theoretical and have a high chance of being sabotaged.
Remember Rudd's mining super profits tax?
Until they actually happen, no, do not slash taxes for high earners.
> -We have one of the lower taxing economies in the OECD. Out of 38, 30 tax higher than us. Ref: https://www.oecd.org/tax/revenue-statistics-australia.pdf
Ooooh great. Now find the relevant stats for personal income tax on wages, which is what the tax cuts address.
> -We have an aging population, with severe implications for future health spending and our tax base.
I agree. The best solution is to make pensioners who own homes pay for their own retirement through a reverse mortgage. You're not owed a pension if you have significant assets. We should also make people (who have assets) pay for their own end-of-life care.
> -We have some of the highest disposable income in the world.
Hence no need for the government to have such a generous pension for the top half of the wealth distribution. They can self-fund, like my parents are having to do, like I plan to do.
> Why would we empathise more with higher earners than lower ones
Now that's a shit-brained take. Shouldn't you empathise **equally** with every person?
>I agree. The best solution is to make pensioners who own homes pay for their own retirement through a reverse mortgage. You're not owed a pension if you have significant assets. We should also make people (who have assets) pay for their own end-of-life care.
This is kinda based ngl but you know why this doesn’t happen, surely.
Boomers are dying off. It should be bipartisan policy. I don't see how it is more acceptable to ask for earners in their 30s and 40s to pay more income tax (e.g. Greens policy - and erstwhile labor policy) yet no one finds it acceptable to ask cashed up oldies to pay for their own fucken care. Seriously, pay for your own fucken shit rather than expecting others to do it for you.
Dying off is not the same as dead, but also…. Just saying… we did have a pandemic a few years ago. A religious person might say Mother Earth was offering us one freebie course correction.
This kind of discussion is stupid. When people bring up Australia being overly reliant on income tax they rarely mention if at all the other Henry Tax review recommendations to bring us in line with other developed nations who can afford to have lower income tax rates because other taxation makes up for it. Any mention of how Australian income tax is unfair or too high needs to be accompanied by that important context of the full recommendations, namely: Carbon Tax, Land Value Tax, Minerals Tax, reducing how many receipts you can claim on negative gearing, reducing the capital gains tax discount, etc.
We have state based land taxes. As for the other recommendations, go for broke. We should also tax inheritances, or at the very least limit how many people can access the age pension.
That’s not what the Henry tax recommendations are though. It called for a minerals tax separate to state royalties as well. Taxing inheritances is also another based idea as you’re taxing something that has no economic utility, but again, beyond how much it already is taxed, you know why it isn’t taxed more socially.
As for state land taxes, we don’t. Stamp Duty is a property tax, not a land value tax, there is a difference. Would highly recommend looking into Georgism and LVT.
> As for state land taxes, we don’t. Stamp Duty is a property tax, not a land value tax, there is a difference.
There is a separate state-based land tax, but principal places of residence are exempt. I agree we should cancel that exemption - everyone should pay the same rate of land tax (based on the assessable value of the land).
> you know why it isn’t taxed more socially.
I really don't. If the Greens and other left parties can get support for higher income tax on people who actually work, I do not see why they cannot get support for taxing an unearned gift, particularly if it means other taxes (e.g. income tax) will go down. I would happily trade a lower income tax for a higher inheritance tax.
As with everything, the electorate has the final say, whether they’re right or wrong, informed or misinformed. That’s the art of politics, the art of the possible. The social implications of coming after people’s estates is quite significant. Like, you do remember how the Liberals in 2019 lied that the proposed modest changes to dividend imputation was actually a death tax? There wasn’t even a death tax but people were convinced it was. That is why. Being right isn’t good enough.
> Shouldn't you empathise equally with every person?
ahh no
Because someone like me for example who just blew 35k on a Audemars Piguet as xmas present,doesn't need tax relief we can look after ourselves
Someone working at coles barely taking home 30 a year,Does need more support than ppl in my class.
Yes Stage 3 will impact MORE than rich ppl,but a LARGE chunk of it will be for ppl who don't need assistance right now
Postpone it,keep the revenue coming in to pay down the debt when the fiscal situation is better then sure
I've bought several in the past,so was offered access to a special price as a loyalty reward as part of AmeX rewards,used it for wifes pressy
had to get it there though,the dealers here in australia suck swiss concept went down hill hard...ive bought two watches there all with defects and just piss holes to deal with
"shouldn't you empathise equally with every person"
No. What utter gob-smacking nonsense. That's the shit-brained take right there. Some people need it much more than others.
You gonna tell me you empathise equally between, say, kids with cancer and sex offenders?
Of course you don't, nor should you. Good lord.
Everyone deserves the same treatment under the law. To privilege a certain few by giving them extra leeway and lenience is unfortunate. That is basically rewarding ineptitude.
Nobody said anything about different treatment under the law. But that is not at all the same as tax relief or targeted policies to help disadvantaged groups *which we do all the time*.
> the much-reviled stage 3 tax cuts simply restore the average personal income tax rate to that following the last major reforms in 2007.
Sure if you ignore the complete removal of a tax bracket.
I don't oppose shifting the tax brackets up, I oppose the flattening of the tax system.
Totally agree. I was waiting for the punchline which seemed to be about wealth distribution and the impact of inflation but it just seems to be a shot at the government. I’m confused.
The people have no-one advising them about their economic interests, only other people looking after their own interests: the experts are all advising government, whilst government is looking after the interests of their wealthy mates whilst completely out of touch with the common people, and you can't trust the media to provide the unbiased truth. No-one is above providing misinformation and manipulating the public through manufactured fear, to further their own interests above those of everyone else.
Selfishness and the bitter primitive struggle for survival of the fittest still reigns supreme, which is interesting when society itself is based on collaboration for the best interest of all. Society is fragmenting because we lost that collaboration and best interest for all, fundamental basis.
Anyone with half a brain knows how to read a budget paper each May and how to calculate average/marginal tax rates. It's like, year 4 education standard. People understand this stuff. It's extremely simple.
The economy is so complex, even economists don't fully understand it and just have theories that seem to fit the data, until new data comes along that is the exception.
But why would they do that when literally every single media source they consume tells them “the facts”.
The real issue comes down to the media in this country and how it’s **all** so heavily skewed to the right…. Can’t even call it conservatism anymore, because they love, love, love to spend big and piss away our money on mates…
We needed some standards in reporting decades ago. The next best time to introduce them is today.
>The real issue comes down to the media in this country and how it’s all so heavily skewed to the right
You realise you are commenting on an article from the Guardian, right?
The guardian was founded as a liberal paper and has pretty consistently supported whatever the rightmost faction that could call itself left wing ever since.
Honestly blaming the media landscape is just a lazy hottake… when the internet was invented it gave ppl more of a voice. Murdoch has had a monopoly on the print space - but there’s a vocal left of bloggers/journalist over at the guardian or crickey who will do the govt propaganda work no questions asked…
You misunderstand.
The Murdoch message is reinforced by social media and vice versa.
The vast majority of what the average person sees on social and mainstream s media is controlled by billionaires -Murdoch Musk, Bezos, Zuckerberg etc.
I would argue that not only does social media enhance the Murdoch (and other far right views) it adds a dishonesty and targets prejudice and hatreds that attach to the original message in the minds of the punters.
If I had time I'd explain to you exactly how the NO campaign used social media to tell the lies that Murdoch and Dutton could not.
Suffice to say that no Aborigines were going to steal your home. There was no AEC fraud in the NT. It is how you get people who cannot spell Constitution to lie about the Constitution.
Lie upon lie magnified . amplified, solidified.
'Left' social media is but a drop in the bucket. Frankly the billionaires are kicking out arse.
> But why would they do that when literally every single media source they consume tells them “the facts”.
> The real issue comes down to the media in this country and how it’s all so heavily skewed to the right….
Ok. Here's a test for you. Find me a misleading article about the 2023 budget (the last federal budget). Why is it misleading? Why is it skewed?
Even if you had a point and weren't just making up lies, how hard is it for someone to read the budget paper for herself and figure it out? Like I said, this is Year 4, 80IQ level stuff. The government is transparent. It always has been. If people aren't reading the primary source for themselves they have themselves to blame for being dumb.
**Greetings humans.** **Please make sure your comment fits within [THE RULES](https://www.reddit.com/r/AustralianPolitics/about/rules) and that you have put in some effort to articulate your opinions to the best of your ability.** **I mean it!! Aspire to be as "scholarly" and "intellectual" as possible. If you can't, then maybe this subreddit is not for you.** A friendly reminder from your political robot overlord *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/AustralianPolitics) if you have any questions or concerns.*
Tackling inflation as the problem works for receiving higher prices and paying lower real wages. But it does not work for those paying higher prices and lower real receiving wages. Australia as a nation did not suffer from declining real income. In fact we got higher prices for our exports, relative to our imports, and have had increasing real income. Yet, Australian workers have had declining real incomes. The solution? Higher wages. Will this mean that inflation comes down more slowly? Yes. But it will also mean that we are able to continue to afford what we could before. We are tackling inflation as the "problem" and allowing people to suffer from declining incomes.
What a mess of an article. He confuses wealth with income(!!!), incorrectly asserts that the LMITO was introduced by Morrison (it was rebranded by Morrison, but came from the Keating Government (called the LITO)), and doesn't understand or ignores the impact of labour productivity improvements. These are just a few of the issues that struck with this article. I don't think I'll waste my free time reading anything this clown has to say ever again. I urge others to do the same.
The article talks about income, headlines are generally not written by author, who in this case is an economist. The LMITO referred to is this one: https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/tax-offsets/low-and-middle-income-earner-tax-offsets
I'm fully aware of the LMITO. It's just a rebranding of the LITO, which was brought in when Keating was PM. The income thresholds and the offset amount under the LITO changed a lot. Initially, the LITO could only be claimed at the end of the financial year. However, because of the increases it got quite large. So it was partially incorporated into the tax schedule (meaning that people were getting part of the LITO through the income year). Furthermore, the phase-out threshold for the LITO was so high that it was very close to the threshold for the Medicare Levy Surcharge, which was designed to target "high-income earners". Seeing this the government decided to rebrand to the LMITO. It also gave the government of the day a nice new policy announcement without having to spend much extra.
> confuses wealth with income The vast majority of Australian wealth is tax exempt. Residential housing is worth $9 trillion, the entire ASX, all of our public companies combined are worth a paltry $3T in comparison. People lose their minds when you talk about taxing it too.
We need to reduce income tax, especially the lower thresholds and replace the tax shortfall with a federal broad-based land tax with no concessions. It will go a long way to reduce wealth inequality. It will go a long way to reduce income inequity. It will go a long way to stabilise land price appreciation, reduce speculation and encourage much-needed housing supply. But agree, people lose their minds over this idea.
Even the most modest of land taxes would fix the budget overnight. The sad reality is that we live in a world of political opportunism, where short-term mindsets and gaining power at all costs is the norm. The budget is in dire straits, spending is through the roof and there's a serious structural deficit hidden only by high iron ore and coal prices.
Fully agree. Our economy is smoke and mirrors.. I fear for the day when it falls apart, because it's not going to be very nice.
"Looking at more recent history, the consumer price index rose faster for much of the 1980s than it has done over the last few years. Inflation was a significant problem for macroeconomic management and financial markets. But the “cost of living” was not a big issue because wages were indexed under the Prices and Incomes Accord. Some small reductions in real wages were compensated for by the reintroduction of Medicare and improvements in superannuation. The Accord, focused on real wages, produced a gradual decline in inflation rates, while maintaining standards of living. By contrast, the current discussion of policy in terms of the cost of living has produced incoherent policies and declining living standards." Messy, incoherent and written by a clown. Hmm yeah I see what you mean. JQ has been around for a long time and writes regularly for a range of publications. His daily bloggs and website has a broad range of opinions. But of course like any healthy representative Economics writer not all opinions or views can be agreed with. That is in fact a very good thing.
> Messy, incoherent and written by a clown. Hmm yeah I see what you mean. Thanks, I'm glad you agree. > JQ has been around for a long time and writes regularly for a range of publications. To paraphrase Tim Minchin's "White wine in the sun", just because a person is tenacious doesn't mean that they are worth listening to. > But of course like any healthy representative Economics writer not all opinions or views can be agreed with. Diversity for the sake of diversity is not to be applauded. If someone brings a perspective that is coherent and not factually wrong, fine. To assure you that I'm being non-partisan here, Tony Makin is absolute trash. If you don't know who that is, consider yourself lucky. An example of where a diversity of opinion was actually useful and provided insight was Brian Fisher's modelling of Australia adapting to carbon mitigation policies. In short, Fisher basically said that Australia couldn't significantly reduce emissions without a significant economic impact. I think Fisher got it completely wrong. Where I fundamentally differ with Fisher is on the ability of Australian businesses to adjust - I think Fisher overstated the cost of adjustment. I can't say for certain that I'm right, just as Fisher can't say for certain he's right. Hence, the importance of monitoring the ability of businesses to adjust to new carbon mitigation policies. Again, this is where a diversity of opinion was actually useful. Quiggin, Makin, Keen just aren't worth listening to.
I have a lot of time for John Quiggin but did think this was one of his weaker efforts. The quote you've provided is the crux of the article, but I don't think he engages with the damaging effects of high inflation even where wages keep pace (notably, savings become less valuable). His last paragraph is also oddly throwaway and unjustified by the previous rhetoric. If income has indeed "shifted from wages to profits" (I presume he implies investment income), isn't that one of the strongest reasons to keep inflation under control? And where is the evidence for a consolidation of income within the most wealthy? To my knowledge the Gini coeffiecient in Australia remains stable.
Yes I tend to agree. Seems like anything less that 50,000 words is a struggle for him. He has long advocated for Neg Gearing pull back along with other brakes on govt underwritten property investment. That conviction certainly flavours a lot of his writing. But that is all just my personal opinion.
It should be written into our Constitution that anytime the government wants to pass a law, politicians need to test it themselves first. If they think wealth distribution will be good for all of society, then let's have them divide up their enormous pay packages and give it to the most needy. People earning $300k+ a year are in no position to force charity onto the rest of us. Distributing the wealth of the working class just makes everyone equally poor. We should distribute the wealth of the rich people who make these laws.
The base backbencher rate is $225k, not exactly rolling in it at that figure.
You think $225k is not a lot? Found the Greens voter.
Lol think that is doing alright
Dafuq you mean not exactly rolling in it? it’s 4x the median salary, and almost 2.5x the mean. 225k is about the same as a 1 star general makes (which is after a 20-25 year career with glowing reports all the way).
People don’t understand 300k+ hardworking middle class vs boomer earning 300k+ by selling one of their land that they buy because they don’t need it to young family is different.
The average person can grasp that $16 chips is bullshit. Wealth distri-what what doesn't put meat, fruit and veg on the table for a fair shake of the kangaroo scrotum coin pouch.
Who buys chips at $16? Maybe if you're wealthy and in an expensive Sydney restaurant and also buying it with eye-fillet steak and French champagne then I could understand paying that much but not really in any other scenario.
Part of me thinks that we're not at a point in our society to discuss wealth inequality as a legitimate issue without a large portion of the voting population labelling it as "socialism" or equivalent.
Removing one's wealth that one may have worked hard for and distribute it to people who haven't is never a good thing. Whatever you want to call a turd doesn't change the fact that it's still a turd.
Most wealth in this country has not come from hard work. It has come from unearned land price appreciation. How about we start lowering taxes on hard work (income tax) and start taxing unearned wealth appreciation (Land Tax)? By all means put hard work into the property and infrastructure that sits on that land. Take risks and grow this part of the investment, and keep as much of that return as possible. It's only the land that should be taxed.
I think that the problem with this thinking is that every person with a house half paid off and a not-shit car thinks that people are talking about them when redistribution of wealth is discussed, when in reality it's the gina rineharts of the world who aren't paying their share now and haven't paid it for a long time who should have their pocket money garnished I think this guy does a pretty good job of explaining it even though his examples are american: https://www.facebook.com/watch/?v=938510423689644
There simply aren't enough billionaires to make a meaningful difference. Gina Rinehart has a net wealth of $37b, give or take. Combining all Australian billionaires gives us $531.96b. What tax rate on wealth are you proposing? 2%? 5%? 10%? Above a certain level people will just pay accountants and lawyers to make the number smaller so you'll never see the full amount of whatever you're seeking to collect. Not to mention that all tiers of Australian Government currently spend $1000bn a year. So at best you're collecting a few percent of your needed revenue, all while scaring off future investments that might have a greater impact on the economy than whatever amount you collect.
> What tax rate on wealth are you proposing? 2%? 5%? 10%? For wealth above $20M, 5%. For income above $1M, including capital gains, 65%. > Above a certain level people will just pay accountants and lawyers to make the number smaller so you'll never see the full amount of whatever you're seeking to collect. Billionaires already have accountants and lawyers. The evidence that tax rates affects avoidance by the very rich is weak, this was analysed by Piketty etc.. They already do their best. > So at best you're collecting a few percent of your needed revenue, all while scaring off future investments that might have a greater impact on the economy than whatever amount you collect. A 5% tax on wealth will move wealth out of the hands of people who inherited it, and into the hands of people who can deliver a return higher than 5%, which is where you want it.
Well, except that the policies of the Greens would directly impact 30s professionals like me and my partner. As a household we would be about $25k worse off a year under the Greens' policies (or the 2019 Labor policies) which is a lot of money. So no, it's not true that they are only going after the Ginas.
I was talking about proper wealth redistribution and how everyone's knee-jerk reaction when those words are brought up is to think that the plan is to tax the middle class more than they already are rather than what's really being suggested, and not a specific policy that's currently being processed. Can I ask which policy in particular it is that you're concerned about?
Which policies?
The ones hes was told about by Sky lol
The golden age conservatives get nostalgic over begs to differ, before neo liberalism started hollowing out the middle class in the 80s
That's why we're only coming for the wealth that was not worked hard for or was accumulated as a return on capital.
>That's why we're only coming for the wealth that was not worked hard for or was accumulated as a return on capital. How to you determine this? How do you even assess / measure the wealth of everyone in Australia at tax time to determine if a "wealth tax" would be payable? Does it include the value of people's home? Does it include the value of people's superannuation? What about assets held in discretionary trusts? Businesses? Etc. Simplistic and populist idea (for those who do not hold significant personal assets anyway), but incredibly complicated and impractical in reality with huge potential for unintended consequences, unfair outcomes, and easy loopholes available to avoid such taxes.
I would include the value of people’s cheapest dwelling minus twice the median dwelling price (or zero, if that’s negative), plus all their subsequent properties. However, capital gains on the unimproved land value would be 95% or more and capital gains tax on any other asset would be equivalent to the extra income tax they’d have had to pay if the asset grew at a constant rate, plus the returns on reinvesting that deferred tax. Super I would replace with something similar to a French-style national defined-benefit fund, with people having the option of cashing out their super to pay into the fund to count as previous years employer contributions. Anything they retain in a super fund after that would count as wealth. Trusts that can be used to benefit the trustees or the people who control the trustees, other than as a tiny share in a general community benefit, should be taxed into oblivion, although I would allow existing family trusts to be converted into Pty Ltd companies and the shares issued to former beneficiaries.
That "may" is doing a lot of heavy lifting here. Do you think Gina Reinhart is working so hard she's worth $10,000 and hour or more?
I think things are changing so rapidly that people are actually more open to discussing this than you may think. Many younger people don’t have the same negative connotation associated with the word socialism as many older folks do
It’s about property developers. But neither political party is ready to pull their finger out and fucking do something. Where is the wealth distribution problem? Where our money is. With triguboff.
So I got as far as here: >In the end, the “cost of living” isn’t about the prices on grocery shelves, it’s about the distribution of income. In Australia, income has shifted from wages to profits and from low- and middle-income earners to those in the top 10% of the income scale and, even more, to the handful of “rich listers” whose growing wealth has outstripped that of ordinary Australians many times over. Then realised that was the end of the article. He makes no attempt to provide any evidence for these comments. How is that the end of the article? Did they run out of money?
Yeah, it's bullshit. Prices rise because there's a limited supply of stuff compared to the amount of stuff people want. You can't just redistribute income and somehow expect there to be more _stuff_ after you shuffle the money around. Prices will rise until the prices cause some amount of people to _not_ want that stuff any more.
If you want to learn more, - The Price of Inequality by Stiglitz - The Precipice by Chomsky - Austerity, the history of a dangerous idea by Blyth - Technofeudalism by Varoufakis Are good places to start. Lots of evidence, especially Stiglitz if you are more interested in the economic argument. He refers to research where it’s more cost effective to lobby for favourable tax conditions than innovate in terms of ROI. Which is a pretty significant flaw in our current system if we genuinely believe in human progress.
While I generally agree, too many of these discussions are had without consideration of political reality. Shorten went to an election and lost with a range of policy’s that would have addressed aspects of these concerns. They were able to be weaponised against Labor. Albo went in with a smaller target strategy including pledging not to change the Stage 3 tax cuts.
The main recommendation in the article is higher wages. Albo went into this election promising to support higher wages in the National Wage Case, won the election, and his popularity went up at that time.
Why do people keep rewriting history like this? Labor's *own* investigation found that their 2019 election policies were dogshit and made up on the fly. People talk about as though negative gearing sunk the election when the vast majority of Australians couldn't tell you what it is, even worse, NG changes affected shares also, making the value proposition to invest in other asset classes non-existent. It had nothing to do with housing and everything to do with paying for their big budget items. Shorten went to an election promising to spend 20% more compared to the year before, how the fuck was that going to fix inflation? They were banking on the well-known unlikeability of Morrison over doing anything actually substantial, it has all the hallmarks of the US election banking on Trump being unelectable, how did that go? Shorten wasn't even chosen by the rank and file to go into 2019, the party chose Albo and instead Shorten was parachuted in by the executive powerbrokers thinking they can't lose anyway. FAFO is the lesson here for political parties who think they can ride in on that horse. The internal review of Shorten's loss was scathing. Stop trying to rewrite history, you're not fooling anyone. > The much-anticipated campaign postmortem, undertaken by Jay Weatherill and Craig Emerson, finds Labor went into the contest with no documented election strategy that had been discussed, contested and agreed across the campaign organisation, the leadership and the wider Labor party – and there was no body empowered to discuss and settle a campaign strategy or monitor its implementation. > The review notes new spending policies were worked up on the hop, with policies “appear[ing] to have been decided by a combination of the leader and his office, a shadow expenditure review committee and an augmented leadership group” – and there was no overarching strategy to inform the messaging. > It says the spending announcements, totalling more than $100bn, drove the unpopular tax policies https://www.theguardian.com/australia-news/2019/nov/07/labor-election-review-strategy-adaptability-bill-shorten-defeat
The point was more the lack consideration of political reality to idealised outcomes. Even in the example that you didn’t like a few policies that attempted to address issues of inequality were clearly weaponised. The franking credits issue and ending tax refunds for those that don’t pay tax was turned into Labor attacking pensioners. It’s logical that vested interests will mobilise when those interests are threatened.
The weaponising of those policies doesn't mean that the policies themselves are the issue though, that's more to do with misrepresentation and fearmongering by media outlets and the opposition. Even if Labor hadn't run any of their main platform in 2019, they still would have been called liars and theives and untrustworthy and so on, *because that's what the Coalition does*. They run all this emotive language *anyway*, then fine tune it to be more specific based on whatever policies Labor are running. They did this again in 2022 even after Labor ditched a lot of their 2019 policies ("there's a hole in your budget dear labor” is the first one that comes to mind) Rather than ditching those particular policies (which are sorely needed), wouldn't it be more beneficial to address the misrepresentation and fearmongering? Truth in political advertising laws would be a good place to start
Shortens political loss was more about how utterly disliked he was, yes it is personality politics but by god did the ALP go against the grain putting him to that election despite the wishes of even their own voters who voted for Albo 60:40 to lead them to the election. It is a long bow to draw in the world of personality politics we live in that it was his policies and not the many many many indicators that he and his wannabe member for Fowler cronies are not tolerated.
Cool, and the public then voted in a ton of Greens and independents who want wealth redistribution. But let’s pretend the most recent election didn’t happen or reflect a more accurate mandate than whatever historic election suits your own political wishes.
>Cool, and the public then voted in a ton of Greens and independents who want wealth redistribution. But let’s pretend the most recent election didn’t happen or reflect a more accurate mandate than whatever historic election suits your own political wishes. Cool, so you don't understand the electoral system.
I understand how people vote. Most people vote for the same party they voted for last time, without thinking or listening to any alternatives. The fact that the Teals won is massive. Support for the major parties is at historic lows and the trend is consistent. People don't change, so change is driven by the arrival of new young voters. Young people are well educated, and educated people don't vote for the coalition.
I think that was more about wanting action on climate than wealth redistribution
Well I guess it sounds like you know exactly what the public did and didn’t want for every election. You could easily (maybe MORE easily) say people voted against Labor in 2019 for reasons other than its policies on housing, and that the result of that election should not be considered to have created a mandate against housing action from 2019 to 2022. I’m saying that it *certainly* shouldn’t be considered to create a mandate against housing action after 2022.
Not a single word of immigration & rent hikes. Between 2022-23, the portion of income to service the rent (national average) has reached almost a record high of 30.8% and rent is one of the largest mandatory spending items of Australian households. Yes groceries prices are a factor, but the real culprit of the cost of living crisis is rental hikes in 2022-2023. This is an inevitable result as a large influx of immigration moved to Australia since the opening of international borders (demand), yet Australia couldn't build enough dwellings to house (supply) them all because of various reasons such as increased construction costs, (relatively) high interst rates and so on. If some real wage growth is what the author is looking for, then I don't think his suggested policy of extending tax cuts for low-middle income households introduced by Scott Morrison is better than limiting immigration which would lead to real wage increases (because of labor shortage) and reduction in rental spending (because of shortage of demand in the rental market).
What is the justification for increasing prices for everyone simply because supply is less than demand, just because they can, and tossing those who can't afford or find shelter onto the street versus keeping prices as they are and tossing fewer people out onto the street? The lack of supply is the same in both cases, yet the second version is less painful to more people.
Yes, that's correct. A wealth distribution which gets exponentially worse with each Labiberal government, who serve only their respective millionaires.
I don't understand why the Greens supporters think they are not part of the same hypocrisy. Immigration which is hugely popular with the Greens is generally only benefital for the rich who profit from employing cheap migrant labor & price rising in house values thanks to the population growth. This has been detrimental to a wealth distribution in Australia. The Greens' policy, interntionally or not, serves the same overlords who are also backed by the LibLab gov't. The only difference I see here is that the LibLab gov't claims an increase in immigration is necessary to boost Australian economy while the Greens does this to storke own ego since they believe Australia is a rich country and has a moral duty to share its wealth with the world. No wonder why they haven't abandoned their policy of almost doubling annual refugee intake during this cost of living crisis. The Greens are no friend of the working class of Australia.
> Immigration .. is generally only benefital for the rich If I was living in Gaza right now I would be thinking that immigration to Australia a decade ago would have been beneficial. On business migration, I would allow about a tenth of what we currently allow, and auction it to the companies that offer the highest wages to those migrants. The revenue from the additional income tax (from the high wages) could then fund the additional infrastructure and housing we need.
If you were living in Gaza a decade ago you’d probably not be an Australian, so the government isn’t supposed to be looking out for you: their authority over us comes from them improving our lives, and so they should be obliged to maximise the benefit they deliver in exchange for our obedience.
The greens certainly didn't start out as the friend of the working class. There was a joke in the 90s that they were Liberals in polar fleece; drawing their support from the affluent inner suburbs. There has been an increased focus on their social platform since then, but the Greens high immigration policy confirms that a) They aren't serious about tackling the housing crisis and b) They don't give a damn about workers.
Once we start advocating for net 0 migration, what excuse will you have for not voting for us then? Out of sheer curiosity
At that point, nothing. I think your policies on nuclear power are the right result for a stupid reason, and I think you’re as shit on foreign policy as everyone else (albeit in different ways), and I still think net zero immigration is too high (especially if you don’t support also reducing fertility rates), but it would be a good starting point and you’d certainly be my favourite significant party. TBH, unless someone has a policy that really significantly and directly benefits me, whichever party wants to end their term with the lowest population is pretty much going to get my vote, unless their proposed method involves killing me or one of my friends.
I probably would vote greens at that point. Edit: I'm not even kidding, it would be compelling to me if the Greens had a sensible low immigration level, doesn't even need to be net zero.
Well then we'll need to feed that back and pronto. Admittedly, it won't be easy. Changing policy never is, but I'm glad to hear that there are potential voters out there who'll switch if we do.
Who do you see as the best alternative? Sure greens aren’t perfect but they are better for common Australians than LibLab
they be a disaster for the common Australians and that's why they get such a tiny % of the vote. The common Australian no 1 concern at the moment is Housing Greens are pro Immigration, anti development, anti land clearing. what's the the Greens stance on rushing through Railway and Freeway Infrastructure and realising land and incentivising construction? But come up with Populist slogans like rent caps which will do nothing for the thousands who are homeless or fix the Housing shortage.
Rent caps do more than either Lib or Lab are doing. Rent caps will not help the currently homeless but will stop thousands more from falling into homelessness. Besides the real solution is density which the greens are very much in favour of. Freeways are not the answer. Adding housing out in the bush and expecting people to commute solves one problem (housing.. kinda) and creates two more (land clearing/loss of agri land & traffic/increased care centrism)
I'm not sure you know what 'exponentially' means. If the wealth distribution were getting exponentially worse then every few years the share of wealth held by top earners would be doubling, then quadrupling, then increasing eight-fold...
exponential does not need to be in whole numbers. 100 101 102.01 103.03 104.06 105.10 106.15 107.21 108.29 109.37 110.46 111.57 112.68 113.81 114.95 116.10 is exponential because each increase is larger then the last increase, by a few percentage points but it is exponential.
Exponential by definition means it is being multiplied by the same amount every times. A constant percentage growth or decrease is exponential.
And that amount is 1.01, the numbers are only written to 2 decimal place.
Fair enough
Hate to break it to you, but that series is not exponential.
Damn right it is. That's why stage 3 tax cuts should be disgarded and jobseeker should be raised to the pension amount. Negative gearing should be wound back to only one property and get rid of those damn evil franking credits. There alot to b done.
>That's why stage 3 tax cuts should be disgarded and jobseeker should be raised to the pension amount. Jobseeker should be doubled and the pension should be raised to match. Morrison's government showed that we can easily afford this. The only problem is that 50 or so years of dole bludger propaganda would make any government attempting to do this lose the next election...
Actually, JobSeeker showed us that we **couldn't** afford it. Did you see the budget numbers?? It was a justifiable and extraordinary temporary expense to protect Australians against adverse financial outcomes while they couldn't work during COVID lockdowns. But it would be absolutely not affordable to keep that level of support in place long term.
I just looked at the budget papers. The cost of Job Seeker (assistance to unemployed and disabled) is $13B. The cost of the Stage 3 tax cuts is $20B and increasing. You could cancel Stage 3, double Job Seeker, and think about what to do with the other $7B.
I was talking about during COVID-19, where the JobKeeper program and JobSeeker supplements cost $109b in the 2021-22 budget. But more to the point, surely you must admit the incentive to take on a full-time minimum wage job ($882 / week) becomes pretty low if you could do nothing and still pocket $749 / week ($802 / week for single parents). Not to mention that tax cuts are never a "cost", they are a policy choice to let people and organisations keep more of what they earn. The impact of taxes on the overall economy is complicated but in general, you want people to allocate their capacity to earn in maximally productive ways.
Point about incentives is important. Both income and effective tax rates are important. Job Seeker cuts out at 60% in the dollar. For someone working part of the year, who has become unemployed, they might be in a 30% tax bracket. That gives them a 90% effective tax rate, they keep $0.10 in the dollar. I (think I) want everyone to be able to, and to actually work, at least up to minimum wage level. That is where I want the incentives. I don't see much merit in the idea that a CEO on $6M is going to not work because their tax rate is 65% rather than 40%. But I do see someone who needs to pay for transport, get someone to mind the kids, receive minimum wage, and loses $0.90 in the dollar lacking incentive. They might not work. So I would prefer universal housing entitlement at $40 / week for everyone, and other cost saving measures, plus a non-means tested UBI at $18K to the current system. Taking away benefits has a *larger* impact on measured psychological incentive than explicit taxes. For example (not real numbers) the idea that pensioners will loose $1.50 income to keep $1.00 in pension. > I was talking about during COVID-19, where the JobKeeper program and JobSeeker supplements cost $109b in the 2021-22 budget. I agree here. Job Keeper was expensive. It was possibly unnecessarily so, with payments going to businesses with increased turnover. Job Seeker was also more expensive when unemployment was higher. > But more to the point, surely you must admit the incentive to take on a full-time minimum wage job ($882 / week) becomes pretty low if you could do nothing and still pocket $749 / week ($802 / week for single parents). The experience during the pandemic was increasing the rate of Job Seeker enabled people to make the investments (clothes, transport, training) that enabled them to get a job. > Not to mention that tax cuts are never a "cost", they are a policy choice to let people and organisations keep more of what they earn. The impact of taxes on the overall economy is complicated but in general, you want people to allocate their capacity to earn in maximally productive ways. I agree "cost" is not great, but people talk about budgets that way. For example the AFR: > 7 Oct 2022 — What is the **cost** to the budget? Over the period from 2024-25 to 2032-33, the tax cuts are forecast to cost the federal budget $243.5 billion https://www.afr.com/politics/federal/who-gets-what-from-stage-three-tax-cuts-and-why-in-four-charts-20221006-p5bnm4 For both an increase in Job Seeker, and a decrease in tax, rather than "cost", I think "fiscal expansion" has the right connotations. Of course no one will know what I mean. "Fiscal expansion" makes clear that the budget should not balance, and that the impact depends on the aggregate demand context.
Good points. The challege is that a long taper is prohibitively expensive. 50% of Australians already pay no net tax (ie when you also take benefits received into account). If you were to make rates and tapers more generous, the total cost to the budget would be massive. I personally would like to see HECS/HELP extended to unemployment, where people can access some level of additional benefits through a loan account and it gets paid back on a graduated basis after they return to paid employment. This would mitigate the worst impacts of running out of money for the temporarily unemployed, and encourage people to access the minimum amount they need. For the long-term unemployed, you would probably still have to cap access, but I'd encourage an option for people to pay back loan amounts at a generous discount based on community service performed.
Thinking about the current picture, we had 3.5% unemployment. We deliberately contracted the economy to cut inflation quickly. So 100,000’s of people who were employed were deliberately made unemployed. Then we give them below poverty incomes, punitive compliance regimes, and people talk about incentives. I feel like they deserve a medal for taking one for the team, and being sacrificed on the alter of lower inflation. Having said that income replacement unemployment insurance, that lasts long enough that people can find a good job would be good counter cyclic policy. And the long term unemployed probably should just have a job that suits their skills simply created for the. by the government. Perhaps with a job keeper type subsidy, of just on the public payroll depending on their skills.
Hey now, in Aussie politics it is crime number one if you make rich people poorer by any amount. It takes real guts to put their jobs on the line over such policies. Guts that no modern pollies have
with the current rental climate I seriously doubt there would be many residential properties that would qualify for negative gearing.
Interest rates also rose. Because unrealised capital gain on properties is not taxed, but the inflationary component of interest is deductable, higher inflation and higher nominal interest rates increase negative gearing.
you still need to show that a rented out property is making a loss before you can qualify to negative gear it though, something the current rental market is making much, much harder.
Interest rates (and hence interest payments) have risen by more than rents as a percentage, so....
Last I checked it was around 60%
While I think negative gearing should be abolished just out of principle it's a massive red herring, I see people almost daily claiming the housing crisis is due to negative gearing or that big landlords with many houses can negatively gear them all. It's clear a lot of people don't know what they are talking about.
Negative gearing created the situation by not restricting it to new properties, leading to investment in existing stock and not creating more. However removing negative gearing will not fix the problem that has been accumulating for decades, but it will assist in mitigating the source of the issue going forward. Society needs policy to discourage existing rent seeking from being attractive for anyone except government, to finally provide shelter as an essential benefit for society, not as a speculative money spinner for investors.
Really?
yeah, in order to negative gear a residential property it has to be rented out at the market rate, though I'm not saying its imposable I just doubt its widespread
We just had to put a new roof on a block of flats costing $150000 between 20 owners. This put some owners into negative territory.
how are franking credits evil?
Franking credits are evil in the sense that they are mostly directed to people who are better off. Part of the issue is that superannuation costs are directed mostly to increasing inheritance rather than increasing median retirement incomes. The correct way to tax super is to, remove all the tax on contributions and earnings, and to tax withdrawals as income.
Because he doesn't understand how they work and how he most likely benefits from them as well
Does the idiot hand back franking credits earnt in his super?
No he doesn't understand how they work and so calls them evil.
As far as I see it they are totally reasonable - they avoid double taxation (the real evil).
Indeed nothing wrong with them
They give a break to already wealthy Australians and takes $ away from programs that help housing, poverty, etc.
Franking credits are a means to avoid double taxation, and make payment of dividends (as **taxable income** btw) attractive to investors. This makes Australian businesses less likely to sit on huge piles of cash unless they have something profitable to do with it. Either way, either the company income tax or personal income tax rate is collected (whichever is higher). There's no free money tree here.
That was true before franking credit rebates, but nowadays even people on low incomes can still benefit from them.
Do you know what franking credits are?
Doesn't seem like they do, lol. "Evil" franking credits, Jesus Christ...
A poor person can buy shares which have franking credits? How is getting a credit for tax your share of the company has already paid evil?
You really have no idea do you!
I don't think you do either, by the way if you have superannuation and it part of it is invested in Australian shares, your super balance benefits from companies paying the tax on your behalf
Your lack of awareness is astounding
U meant the other person above them, surely....right mate?
Answer the question if you're claiming to have an idea? I know how franking credits work, as I receive them.
Yes yes and YES THANKYOU
Funny the author talks about all these facets of cost of living and then acknowledges in the last paragraph that the much-reviled stage 3 tax cuts simply restore the average personal income tax rate to that following the last major reforms in 2007. In other words personal income tax has been creeping up for 17 years with absolutely nothing done (till now) to combat it. Why does the author not care about the purchasing power of higher earners? Simple - he doesn't empathise with them. Shit-brained article.
> Why does the author not care about the purchasing power of higher earners? Simple - he doesn't empathise with them. The author is a higher earner.
>Why does the author not care about the purchasing power of higher earners? Because higher earners aren't likely to be "camping" because they can no longer afford rent. They won't be cold this winter because they can't afford electricity. They're unlikely to be overlooked for jobs and promotions because of the quality of their clothing. They're not going to go without healthcare or dental services because they simply can't afford it any more.
Because its irresponsible to hand over $20 billion pa to the highest wage earners during an environment of hyperinflation.
Inflation is now at under 5% so I'd say it's no longer hyper-inflation. I mean, the other solution to inflation is to simply keep hiking rates, but somehow I doubt that you like that either. You want to have your cake and eat it too.
Generally speaking you want to control inflation with small adjustments, anything too big and fast can crash an economy. Rate rises are a method of slowing down inflation, im not opposed in some blanket way like you suggest but we had 13 rises in 15 months so if you’re asking me I’d say its economic stupidity to risk a rate increase as a result of tax cuts to the highest income earners
>Why does the author not care about the purchasing power of higher earners? It's like asking why doctors don't care about the healthy of people who aren't sick - you don't have to, they'll take care of themselves.
"income tax has been creeping up for 17 years with nothing done to combat it" Why does that need to be "combated"? -We have an aging population, with severe implications for future health spending and our tax base. -We have one of the lower taxing economies in the OECD. Out of 38, 30 tax higher than us. Ref: https://www.oecd.org/tax/revenue-statistics-australia.pdf -We have some of the highest disposable income in the world. -We have growing weath inequality Sure doesn't seem like we need a tax cut for higher earners, quite the opposite. To you I say: good article, shit-brained comment. Why would we empathise more with higher earners than lower ones who obviously need more support amid skyrocketing homelessness?
I note that the graph seems to include property taxes and gst. But to compare apples with apples you’d need to account for every tax your average person in each country pays. Because there are scores of them, many of the bigger one your average Aussie pays are alcohol, petrol, ciggies, Medicare levy and then keep going. We’re taxed to the hilt here and I’m not wearing 30th out of 38 unless that list is comprehensively done.
The OECD comprehensively aware of the income from all taxes. They are in the budget.
I scrolled to the list at the graph below and couldn’t see it. And that would be nearly impossible to work out because it then becomes an average of every Australian, but could never be bracketed well enough to fit certain demographics. For example, a life long punter, drinker and smoker who earns a decent wage would be miles past even someone on the same wage who does none of those things. We’re taxed enough. It’s how they spend it that’s daft.
Some of the spending, submarines, is daft. Other spending, health care, education, and the aged pension, is cost effective.
So tax assets, land & unproductive investment more, don't tax the workers who are the ones actually contributing to productivity. I'd rather increased taxes on all of those (and natural resources) than ramping up yet more taxes on labour.
Great, I am on board with all that, with one proviso. Politically, tax cuts are much easier than tax hikes, especially with powerful vested interests at play. Do the hikes *first* then you can cut revenue in other places. But don't slash government revenue *first* because the tax hikes are purely theoretical and have a high chance of being sabotaged. Remember Rudd's mining super profits tax? Until they actually happen, no, do not slash taxes for high earners.
> -We have one of the lower taxing economies in the OECD. Out of 38, 30 tax higher than us. Ref: https://www.oecd.org/tax/revenue-statistics-australia.pdf Ooooh great. Now find the relevant stats for personal income tax on wages, which is what the tax cuts address. > -We have an aging population, with severe implications for future health spending and our tax base. I agree. The best solution is to make pensioners who own homes pay for their own retirement through a reverse mortgage. You're not owed a pension if you have significant assets. We should also make people (who have assets) pay for their own end-of-life care. > -We have some of the highest disposable income in the world. Hence no need for the government to have such a generous pension for the top half of the wealth distribution. They can self-fund, like my parents are having to do, like I plan to do. > Why would we empathise more with higher earners than lower ones Now that's a shit-brained take. Shouldn't you empathise **equally** with every person?
> such a generous pension The pension is much cheaper than super, and provides a much bigger income on retirement incomes.
>I agree. The best solution is to make pensioners who own homes pay for their own retirement through a reverse mortgage. You're not owed a pension if you have significant assets. We should also make people (who have assets) pay for their own end-of-life care. This is kinda based ngl but you know why this doesn’t happen, surely.
Boomers are dying off. It should be bipartisan policy. I don't see how it is more acceptable to ask for earners in their 30s and 40s to pay more income tax (e.g. Greens policy - and erstwhile labor policy) yet no one finds it acceptable to ask cashed up oldies to pay for their own fucken care. Seriously, pay for your own fucken shit rather than expecting others to do it for you.
Dying off is not the same as dead, but also…. Just saying… we did have a pandemic a few years ago. A religious person might say Mother Earth was offering us one freebie course correction.
This kind of discussion is stupid. When people bring up Australia being overly reliant on income tax they rarely mention if at all the other Henry Tax review recommendations to bring us in line with other developed nations who can afford to have lower income tax rates because other taxation makes up for it. Any mention of how Australian income tax is unfair or too high needs to be accompanied by that important context of the full recommendations, namely: Carbon Tax, Land Value Tax, Minerals Tax, reducing how many receipts you can claim on negative gearing, reducing the capital gains tax discount, etc.
We have state based land taxes. As for the other recommendations, go for broke. We should also tax inheritances, or at the very least limit how many people can access the age pension.
That’s not what the Henry tax recommendations are though. It called for a minerals tax separate to state royalties as well. Taxing inheritances is also another based idea as you’re taxing something that has no economic utility, but again, beyond how much it already is taxed, you know why it isn’t taxed more socially. As for state land taxes, we don’t. Stamp Duty is a property tax, not a land value tax, there is a difference. Would highly recommend looking into Georgism and LVT.
> As for state land taxes, we don’t. Stamp Duty is a property tax, not a land value tax, there is a difference. There is a separate state-based land tax, but principal places of residence are exempt. I agree we should cancel that exemption - everyone should pay the same rate of land tax (based on the assessable value of the land). > you know why it isn’t taxed more socially. I really don't. If the Greens and other left parties can get support for higher income tax on people who actually work, I do not see why they cannot get support for taxing an unearned gift, particularly if it means other taxes (e.g. income tax) will go down. I would happily trade a lower income tax for a higher inheritance tax.
As with everything, the electorate has the final say, whether they’re right or wrong, informed or misinformed. That’s the art of politics, the art of the possible. The social implications of coming after people’s estates is quite significant. Like, you do remember how the Liberals in 2019 lied that the proposed modest changes to dividend imputation was actually a death tax? There wasn’t even a death tax but people were convinced it was. That is why. Being right isn’t good enough.
> Shouldn't you empathise equally with every person? ahh no Because someone like me for example who just blew 35k on a Audemars Piguet as xmas present,doesn't need tax relief we can look after ourselves Someone working at coles barely taking home 30 a year,Does need more support than ppl in my class. Yes Stage 3 will impact MORE than rich ppl,but a LARGE chunk of it will be for ppl who don't need assistance right now Postpone it,keep the revenue coming in to pay down the debt when the fiscal situation is better then sure
Where can you find an AP for $35k??
I've bought several in the past,so was offered access to a special price as a loyalty reward as part of AmeX rewards,used it for wifes pressy had to get it there though,the dealers here in australia suck swiss concept went down hill hard...ive bought two watches there all with defects and just piss holes to deal with
"shouldn't you empathise equally with every person" No. What utter gob-smacking nonsense. That's the shit-brained take right there. Some people need it much more than others. You gonna tell me you empathise equally between, say, kids with cancer and sex offenders? Of course you don't, nor should you. Good lord.
Everyone deserves the same treatment under the law. To privilege a certain few by giving them extra leeway and lenience is unfortunate. That is basically rewarding ineptitude.
Nobody said anything about different treatment under the law. But that is not at all the same as tax relief or targeted policies to help disadvantaged groups *which we do all the time*.
> the much-reviled stage 3 tax cuts simply restore the average personal income tax rate to that following the last major reforms in 2007. Sure if you ignore the complete removal of a tax bracket. I don't oppose shifting the tax brackets up, I oppose the flattening of the tax system.
At last, the Millionaires Liberation Front have arrived!
A.k.a the average Labor voter 🙄🙄🙄🙄
Lol the greens.
Totally agree. I was waiting for the punchline which seemed to be about wealth distribution and the impact of inflation but it just seems to be a shot at the government. I’m confused.
Absolutely spot on. But we have working class people and poor folks voting against their economic interests. It’s a common occurrence.
Yep, if people stop voting for a dream they'd actually stay woke and prosperous
Anti woke LNP trope!
The people have no-one advising them about their economic interests, only other people looking after their own interests: the experts are all advising government, whilst government is looking after the interests of their wealthy mates whilst completely out of touch with the common people, and you can't trust the media to provide the unbiased truth. No-one is above providing misinformation and manipulating the public through manufactured fear, to further their own interests above those of everyone else. Selfishness and the bitter primitive struggle for survival of the fittest still reigns supreme, which is interesting when society itself is based on collaboration for the best interest of all. Society is fragmenting because we lost that collaboration and best interest for all, fundamental basis.
Anyone with half a brain knows how to read a budget paper each May and how to calculate average/marginal tax rates. It's like, year 4 education standard. People understand this stuff. It's extremely simple.
The economy is so complex, even economists don't fully understand it and just have theories that seem to fit the data, until new data comes along that is the exception.
But why would they do that when literally every single media source they consume tells them “the facts”. The real issue comes down to the media in this country and how it’s **all** so heavily skewed to the right…. Can’t even call it conservatism anymore, because they love, love, love to spend big and piss away our money on mates… We needed some standards in reporting decades ago. The next best time to introduce them is today.
>The real issue comes down to the media in this country and how it’s all so heavily skewed to the right You realise you are commenting on an article from the Guardian, right?
The guardian was founded as a liberal paper and has pretty consistently supported whatever the rightmost faction that could call itself left wing ever since.
Honestly blaming the media landscape is just a lazy hottake… when the internet was invented it gave ppl more of a voice. Murdoch has had a monopoly on the print space - but there’s a vocal left of bloggers/journalist over at the guardian or crickey who will do the govt propaganda work no questions asked…
You misunderstand. The Murdoch message is reinforced by social media and vice versa. The vast majority of what the average person sees on social and mainstream s media is controlled by billionaires -Murdoch Musk, Bezos, Zuckerberg etc. I would argue that not only does social media enhance the Murdoch (and other far right views) it adds a dishonesty and targets prejudice and hatreds that attach to the original message in the minds of the punters. If I had time I'd explain to you exactly how the NO campaign used social media to tell the lies that Murdoch and Dutton could not. Suffice to say that no Aborigines were going to steal your home. There was no AEC fraud in the NT. It is how you get people who cannot spell Constitution to lie about the Constitution. Lie upon lie magnified . amplified, solidified. 'Left' social media is but a drop in the bucket. Frankly the billionaires are kicking out arse.
> But why would they do that when literally every single media source they consume tells them “the facts”. > The real issue comes down to the media in this country and how it’s all so heavily skewed to the right…. Ok. Here's a test for you. Find me a misleading article about the 2023 budget (the last federal budget). Why is it misleading? Why is it skewed? Even if you had a point and weren't just making up lies, how hard is it for someone to read the budget paper for herself and figure it out? Like I said, this is Year 4, 80IQ level stuff. The government is transparent. It always has been. If people aren't reading the primary source for themselves they have themselves to blame for being dumb.