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Anyone for flat tax?

By jardinier ·
Yes, I know all you American right-wing fundamentalists would prefer no tax at all, so please spare me the reiteration of your gripes.

I am a great believer in flat tax as it would greatly simplify the taxation system, including calculation of personal or company tax, and in the long run would be a major incentive for people at all current tax levels to work harder, knowing that they would not be penalised for doing so.

This is an item from the only Australian national newspaper, "The Australian." [Founded in 1964 by Rupert Murdoch when he still had some ethics. It remains one of Australia's most highly respected newspapers.]

Americans and others please note that the conservative party in Australia is called "The Liberal Party."

[The Australian, February 28, 2006]
Federal Treasurer Peter Costello has instigated an inquiry designed to find the world's best tax systems, which will include a review of low-taxing Asian economies and eastern European countries where flat taxes are as low as 16 per cent.

One of the prominent businessmen conducting the inquiry, **** Warburton, said yesterday it would not be limited to the 30 developed nations in the Organisation for Economic Co-operation and Development. It would include nations such as Romania, Slovakia and Estonia, which have a single low tax rate for all employees that also applies to companies.

"These are not beyond our remit and we discussed these countries at our last (Board of Taxation) meeting," Mr Warburton said. "We'll look beyond the OECD."

In Romania, the rate is 16per cent, while in Slovakia it is at 19per cent and Estonia 24per cent. Mr Warburton said the review would definitely include Singapore and Hong Kong, both of which have low personal income tax rates. Mr Costello said his inquiry aimed to provide a definitive set of facts showing the areas in which Australia met international practice and those where it lagged.

"Armed with those facts, we will be able to direct our attention to those areas where Australia lags and, in response to that, be able to ensure that the Australian taxation system meets international practice," he said.

Access Economics estimates the cost of getting the top rate of tax down to 42per cent, which is the average rate for the non-European members of the OECD, would be $1.7billion in the first year, rising to $2.4billion by the fourth year. The cost of taking the 47c and 42c rates to 40c would be more than $15billion over the next four years.

While interest in the tax investigation has focused on comparison with the tax rates of Australia's major competitors, Mr Warburton said the inquiry would not focus on developed nations' averages, which are distorted by small high-taxing countries in western Europe.

"We're going to look behind the averages to get some kind of a weighting and a range," he said. "For example, the threshold for the top personal tax rate in the US is about $US300,000. What happens if you go with that, or one that is much lower, or an average?"

Mr Warburton said he and Australian Chamber of Commerce and Industry chief executive Peter Hendy had not been given any riding instructions from Mr Costello, other than to "get the facts" on where Australia stood. He said that although Mr Costello was of the view that Australia was a low-taxing country, he did not express an opinion about what he expected the review to find.

The Treasurer's major concern was that the debate on personal tax was distorted by people "cherry picking" elements of other systems and saying Australia should follow them. The review would go beyond headline tax rates and thresholds and would also try to compare the generosity of deductions and exemptions in other tax systems.

Mr Warburton said it was premature to conclude that the inquiry would pave the way for a trade-off of tax cuts for fewer workplace deductions. The inquiry would also aim to identify levies, such as road tolls. It would also look at high effective rates levied on low-income individuals as family and other benefits are withdrawn.

Mr Warburton said this was a difficult area to resolve, as any movement of thresholds or taper rates produced winners and losers. "There might be 80per cent winners, but in tax, the winners are grinners and say nothing and the 20per cent who lose make a lot of noise."

Liberal MP Sophie Panopoulos, a leading advocate within her party for tax and welfare reform, said scrutiny of Australia's tax and welfare payment system was needed for real tax reform to take place.

"It would be particularly useful if this inquiry included in its benchmarking of our taxation system benchmarking on family taxation," Ms Panopoulos said. "That is a comparison of effective marginal tax rates for working families. We may learn something from the various forms of income splitting applied in other countries."

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For a minute, there, Jules

by gadgetgirl In reply to Anyone for flat tax?

I was wondering what sort of "flat tax" you were on about.....!

(if there was a "flat" tax, that'd be okey-dokey by me....!!! )



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Julinn - How many times must I correct you?

by maxwell edison In reply to Anyone for flat tax?

You said, "Yes, I know all you American right-wing fundamentalists would prefer no tax at all, so please spare me the reiteration of your gripes.

Now I don't consider myself a "right-wing fundamentalist", but other people have charged me as one. Nonetheless, I believe you were addressing people like me, regardless of what we or others may or may not call us.

I've never espoused "no tax at all" -- never. It's where and how those taxes are spent that is the issue. Spending on national defense, yes; spending on a national retirement system, no. Spending on roads and infrastructure, yes; spending on personal housing, no. Spending on police and fire protection, yes. Spending on prescription drugs for individuals, no. Spending on maintaining our form of government, yes. spending on maintaining people's individual way of life, no.

When will you get it right? And how many times must I correct you before you stop repeating the same silly thing? And why do you always to that? I know you're smarter than that, but you keep doing it. I suppose you also accompany it with a silly and condescending giggle that's so prevalent in many left-wing fundamentalists.

And how can I possibly absorb the rest of your message if I can't even get past the first sentence?

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To the best of my knowledge and recollection

by jardinier In reply to Julinn - How many times m ...

because obviously I don't read all discussions, I have only heard you say: "I don't believe that a dollar which has been earned by someone who has worked for it, should be given to someone who has not worked for it," or words to that effect.

I am ONLY aware of your objection to the welfare programs.

As for assuming that you were one of the peers my comment addressed, then perhaps you are paranoid. There are some peers who have stated quite categorically that they DO NOT approve of taxation on ANYTHING !!!

I have NO recollection of you ever specifying which taxes you find acceptable. But as I said, you may have stated this in some discussion which I did not visit.

Thank you for defining my political stance -- I was never quite sure where I fitted in.

What YOU will never get into your head is that the left-wing party in Australia, the Labor Party, bears very little resemblance to your Democratic party, either in ideology or practice.

But if I press your buttons so readily, perhaps you should add me to the list of people whose posts you deliberately avoid reading.

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Let me put it this way

by maxwell edison In reply to To the best of my knowled ...

I don't know of any reasonable person who advocates the abolition of all taxes. I also don't know of any reasonable person who actually believes that there are such "reasonable" people. So if you want to have a reasonable discussion with reasonable people, I don't understand why you would start it with such an unreasonable comment, regardless of its intended audience.

By the way, your knowledge and recollection is correct, at least to some degree. But again, you pigeon-holed my sentiments into the "welfare" definition.

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Julian - I'll let apotheon speak for himself

by maxwell edison In reply to To the best of my knowled ...

I won't presume to know what he meant or the context in which it was said. And I don't really care to read that whole discussion tree to figure it out.

Nonetheless, I will say this. He said, "Nobody should be able to use tax dollars to do anything." While you claimed he said that he, "DO(es) NOT approve of taxation on ANYTHING !!!

"to use tax dollars to do anything ...... versus ..... "does not approve of taxation on anything" ..... big difference.

But I'll only speak for myself.

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by jardinier In reply to Julian - I'll let apotheo ...

If you read apotheon's comment in the context of the discussion, I think you will readily see what he implied by that statement.

In fact when I challenged him to suggest means other than tax for a government to raise revenue, he was quite unable to give a satisfactory reply, but instead responded with: "Have you no ability to think for yourself?"

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That isn't what Apotheon said

by jdclyde In reply to apotheon

He said "income tax" not tax, in the follow up post.

We pay taxes on services, property, sales, "sin taxes" and so on that have NOTHING to do with income.

To tax someones income based on how much they make only removes incentive to make more.

I have known people to turn down Overtime pay (time and a half) because it would put them into a higher tax bracket and cost them more.

A current example in my own life. My ex wife made only 2/3 what I did over the year, but got back more than twice the tax return I did. (we each had the same weekly deductions and everything else was equal. Bottom line, I paid twice what she did in taxes. If I had made about 2k less, I would have gotten a huge deduction available. Made too much for it.

I also had the year my twins were born, an incredible thing happen to me. I got almost 2K back MORE than I paid in. Not only did I not pay taxes that year, but I got other peoples tax money given to me.

Can you say "redistribution of wealth"?

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I'll admit my ignorance

by maxwell edison In reply to To the best of my knowled ...

You said, "What YOU will never get into your head is that the left-wing party in Australia, the Labor Party, bears very little resemblance to your Democratic party, either in ideology or practice."

I suppose I could be mistaken, but I usually consider left-wing more of a collectivist thinking group of people, and the "right-wing" being less of that, regardless of what you call it or where it is.

Okay, I admit my ignorance. But will you please provide me a comparison of Australia's left-wing Labor Party and America's left-wing Democrat Party?

By the way, how about defining your political stance? I'd be quite interested to know where you stand and why. Then they'll be no assumptions or misunderstanding on my part.

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ALP versus Democratic Party

by jardinier In reply to I'll admit my ignorance

The Australian Labor Party is the oldest political party in Australian and was actually already in existance before Australia became a federation, with a constitution, in 1901.

Initially one of its primary objectives was to work towards the socialisation of industry and production.

HOWEVER, during the reign of Labor Prime Ministers Bob Hawke (1983 - 19**) and Paul Keating (19** - 1996) the party moved very noticeably towards the centre -- so much so in fact that many people have complained that they can't tell the difference between the two major parties.

It was under Bob Hawke's leadership that the practise was introduced of privatising Government owned and controlled enterprises as a means of raising revenue without increasing taxes.

Thus Australia's left-wing party is very much closer to the political centre than America's Democratic Party.

The Labor Party is not trying to remove teaching of scripture in schools. It is not pro-abortion.

You can read the party's platform for yourself. Yes, it is certainly still a left-wing party, supporting welfare programs and so forth, but it has a more positive approach overall than your Democratic Party (IMHO of course).

I will address your other question (about my political stance) later as duty calls.

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My political stance

by jardinier In reply to I'll admit my ignorance

Some time ago you asked me to describe my core values. I simply answered that I try to live according to the teachings of Jesus, which apparently satisfied you as you made no further comment.

What you perhaps overlooked is that Jesus was extremely left wing ? support the poor and needy, pay your taxes, and do not aspire after wealth.

In the various online political tests, I usually come out slightly to the left of centre.

I will now address the issue of social welfare ? so regularly scorned by certain members of this website (those to whom I referred as right wing fundamentalists).

Australia has a very extensive welfare system and I have never heard ANYONE who is inclined to right wing politics suggest that we should not have such a system or that people who are welfare beneficiaries are in that position by their own choice because they are too lazy to work.

As I live in what was in 2001 the second safest conservative electoral division in Australia, I think I would know about it if any conservatives were against the welfare system in general. We do have people who are dole bludgers by choice, but most young people who are on the dole are there because, after two decades of high unemployment, young people who were genuinely seeking work simply became discouraged after failing numerous applications for work.

I will now address the issue of free or highly subsidised health care, from my personal experience. Some members of this website who are healthy, highly motivated and successful, are apparently unable to concede to the possibility that some people simply are unable to compete in the pressures of modern society.

Well I am one of those people. Genetically I inherited a highly sensitive nature and low physical stamina. Both my father?s parents had committed suicide, which is not a nice set of genes to live with.

In my unsuccessful attempts to compete to a satisfactory degree, I suffered what you might describe as a complete nervous breakdown, except that it occurred over a number of years. Eventually life became such a living nightmare that I visited a doctor who prescribed medication and put me on Sickness Benefits. When there was no improvement in my condition after two years, I transferred to a Disability Pension which has been my primary source of income for 20 years.

Two years ago some of you may recall that I suffered heart failure and was admitted to hospital. As a pensioner I was entitled to Medicare (introduced by Labor PM Gough Whitlam during his short term of office from 1972 ? 1975) which covered all my medical expenses which were incurred during my period of hospitalisation.

Part of Medicare is a system called Bulk Billing which allows doctors or other people in the health care industry to accept from the government a lower fee than they would normally charge, so that the patient is charged nothing.

We also have a Pharmaceutical Benefits Scheme under which certain medicinal drugs can be purchased for a nominal fee instead of the full cost.

Now if some of you feel that it is beneath your dignity to share the same cyberspace with someone whose very existence has and will continue to depend on welfare, then let me know and I will exit from these discussions.

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