# $2m Home Tax - What's next?



## stocksontheblock (15 August 2009)

Well, as per The Australian this morning (Sat 15/8/09) we can possibly expect to see a capital gains tax applied to all homes over the value of $2million.

Disclaimer: I dont have a house worth more than $2million - sadly.

Now, doesnt this seem like yet another Labor Party - if it is adopted - grab to make the so called 'rich' the whipping boy for the apparent poor Labor Party supporters?

I guess the one thing that really makes me quite angry about this is the comments from the 'accountants' and 'tax experts' that the Australian home is the biggest tax haven - code for rort - and so should be treated in a manner so as to collect a 'fair' share of tax.

Now, correct me if I am wrong, yet I have never brought any of the homes I have had, nor has anyone I know, purchased their home because it was an effective means of reducing their tax. They PURCHASED the home because they wanted a place to live it, and if so desired, raise a family in.

So ... what do you all think? Is this something that is fair?


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## Mofra (15 August 2009)

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Krudd needs to find a way to pay for his splurges (the direct hand-out, the indirect hand-out, NBN that is a looming disaster).

I'm wondering if this $2m figure will be indexed to an inflation measure or will we see this tax apply in decades when $2m homes are far more common?


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## drsmith (15 August 2009)

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Mofra said:


> I'm wondering if this $2m figure will be indexed to an inflation measure or will we see this tax apply in decades when $2m homes are far more common?



If this goes ahead then then I would give indexation of the $2m threshold about as much chance as the indexation of income tax brackets.

Several years ago the then WA state ALP government proposed something similar but in a far cruder form. Their plan was to levy a premium property tax of 2% on residential properties valued at $1m+ payable annually. When it was realised there would be cases of Mr & Ms Pensioner being forced to sell their family home of many decades, the plan was modified so that in those cases the tax woud acculumate and be payable out of their estate upon death.

No prizes for guessing what that got called. The premium property tax idea was subsequently scrapped.


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## trainspotter (15 August 2009)

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Strangling the goose that lays the golden eggs immediately springs to mind. Socialiasm is alive and well ... eat the rich.


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## Buckeroo (15 August 2009)

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Mofra said:


> Krudd needs to find a way to pay for his splurges (the direct hand-out, the indirect hand-out, NBN that is a looming disaster).
> 
> I'm wondering if this $2m figure will be indexed to an inflation measure or will we see this tax apply in decades when $2m homes are far more common?




One thought is to calculate the capital rise on a yearly basis (similar to rates) & you pay capital gains tax annually. It may start at $2M but in coming years I'm sure it would be widened to lower valued housing.

How about this scenario:
If your house dropped in value, say 40%, in one year, then in the next it started rising again, would have to pay a second time for the same capital increase? The mind boggles.

Cheers


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## Buckeroo (15 August 2009)

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trainspotter said:


> Strangling the goose that lays the golden eggs immediately springs to mind. Socialiasm is alive and well ... eat the rich.




Yeah they are going down the right track for socialism....if you have a government providing all the jobs, food & clothing, why the hell would you need rich people.

Cheers


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## trainspotter (15 August 2009)

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Buckeroo said:


> Yeah they are going down the right track for socialism....if you have a government providing all the jobs, food & clothing, why the hell would you need rich people.
> 
> Cheers




Ummmmmmm ... to pay the tax to keep the welfare handouts flowing? To employ people to pay the tax to keep the welfare handouts flowing? Margaret Thatcher summed it up beautifully "The problem with socialist governments is that they soon run out of other peoples money to spend" LMFAO 

It appears that the Government is forming "policy on the run" to stem the black hole of fiscal responsibility they have created. I know of a little boy in Holland who is fond of putting his finger in dykes. Perhaps I should give him a call before the dam bursts and the tax pain really begins to hurt?


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## tech/a (15 August 2009)

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Damn.
It will be the Bloody Leah Jet next!


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## Uncle Barry (15 August 2009)

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Buckeroo said:


> Yeah they are going down the right track for socialism....if you have a government providing all the jobs, food & clothing, why the hell would you need rich people.
> 
> Cheers




Good afternoon.
Whats next,
DEATH DUTY !
Because you need money to buy votes from the bl.....ers, and taking money from the called rich is the quickest way !

down the right track for socialism....
WRONG !
this is the path of COMMUNISM !

The difference between the two is, 
one, the people are tricked at the polling booth and
the other comes via the gun 

BUT
if you remove as many guns as possible from the general public, the Gov of the day can do ANYTHING IT LIKES !

Kind regards, Australia, you will need all the luck you can muster shortly with the commies in power !
UB


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## stocksontheblock (15 August 2009)

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Buckeroo said:


> How about this scenario:
> If your house dropped in value, say 40%, in one year, then in the next it started rising again, would have to pay a second time for the same capital increase? The mind boggles.
> 
> Cheers




Great point!!! Yet its never stopped the government taxing people twice for the same thing ... so this would just become what they euphemistically call 'unfortunate'.


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## trainspotter (15 August 2009)

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Double dipping is what governments do best. Rmember the GST promise of NO STAMP DUTY? Paid your insurance lately? Bought a vacant block of land and constructed a house lately? Classic examples. Both are there for the Guvmt to plunder.


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## stocksontheblock (15 August 2009)

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After reading more and more on this what I also find very odd is that the 'egg-heads' who have come up with this wonderful idea - just for the egg-heads, that is written with LOTS of sarcasm - is that if you apply this because, as has been suggested the rich get, $1 for $1 a better deal (with no capital gains applied), then naturally it would only be the rich who could also off-set the interest, repairs, capital repairs etc on the 'family' home, and so would be able to off-set more against their income and hence reduce their tax bill, so would this not become a self-fulfilling circle of:

1. tax every $ that the home is over $2m
2. use interest paid as a deduction
3. pay less tax
4. money paid on capital gains is lost against revenue lost on lower tax paid

And ... if you can afford a house of this sort of value then it would be in your interests to borrow more to pay more in interest to have more to write off against your income ... so all in all, to catch the apparent 'rich' with their wealthy homes and tax havens, you actually given them an even bigger tax break.


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## drsmith (15 August 2009)

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IIRC, GST replaced the federal wholesale sales tax system although excise remained on the three old favourites, fuel, alcohol and cigarettes.

Sales taxes, stamp duties etc are typically levied by state governments so the way to get rid of those taxes is obvious.


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## trainspotter (15 August 2009)

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drsmith said:


> IIRC, GST replaced the federal wholesale sales tax system although excise remained on the three old favourites, fuel, alcohol and cigarettes.
> 
> Sales taxes, stamp duties etc are typically levied by state governments so the way to get rid of those taxes is obvious.




Building products had a sales tax on them that was removed and a 10% Federal GST was overlaid. Did construction costs come down? NUP ... labour quantity of building contract added the 10% PLUS the builder added a further 10% on his bottom line. Oh dear.

But you are right Dr Smith. Sales tax is the responsibility of the State Department of Revenue. Wine Equalisation Tax was another favourite of mine. LOL. A WET Tax for wine. How ironic.


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## prawn_86 (15 August 2009)

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Dont homeowners already pay rates and body corporate fees?? Another incentive to rent... Although it will push rents up too if it happens i guess (only high end 'executive' rents)


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## gfresh (15 August 2009)

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Seems silly idea to me, and will simply introduce further distortions, of which there are already many. All it will do is encourage wealthy owners to never sell their property .. collect the yearly deductions, and simply invest gains or the deductions into further properties. 

If this were to be expanded to the general market, what a mess.. nobody would ever sell their properties, they'd simply keep their existing and buy another to avoid the CG, not really a great solution to the supply problem.


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## badger41 (15 August 2009)

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Whats next,
DEATH DUTY 

It's here already, Uncle Barry. 

It's the 15% of capital that you'll pay when you have no "dependents" to leave your superannuation to (and chances are your only remaining dependent is your spouse, if you have one. Adult kids don't count, and when spouse dies...). Half a million in super? There goes $75K!

Never mind, just keep paying the fees to run your SMSF, or to your financial adviser, fund manager etc to "manage" your superannuation. 

Not financial advice, but right now over '60's can cash in super tax and fee free. A window of opportunity?

Cheers, badger.


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## So_Cynical (15 August 2009)

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Yet another ALP/Rudd bashing thread  bring on the double dissolution i say.

If i had a 2 million dollar house i wouldn't be complaining about any new taxes, and genuinely struggle to understand how anyone potentially suffering from this new proposed tax could or would have a problem with it. 

Have money = pay tax


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## trainspotter (15 August 2009)

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So_Cynical said:


> Yet another ALP/Rudd bashing thread  bring on the double dissolution i say.
> 
> If i had a 2 million dollar house i wouldn't be complaining about any new taxes, and genuinely struggle to understand how anyone potentially suffering from this new proposed tax could or would have a problem with it.
> 
> Have money = pay tax




Spoken like a true socialist. Let's say I worked hard in the fifties (1957) and purchased a property in an outer suburbs close to the beach. It was not much back then, fibro 3 bedroom home sitting on 1000sqm and a thunderbox out the back. I retired in 1987 and continued to live in my own piece of Australiana and decided to upgrade my sh!tbox and place internal plumbing inside so the Missus did not have to wander around in the backyard looking for the crapper. I am now 82 and living on the pension and my house is valued at over 2 million and I am on the pension. 

Above is a basic outline of the possibilties of what can and does happen in the real world. The state govt tried the same thing in WA. Massive voter backlash. Oh well ........ there will be plenty more "rich people" to thieve from in the way of taxes in the future. *NOT !*


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## Garpal Gumnut (15 August 2009)

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trainspotter said:


> Spoken like a true socialist. Let's say I worked hard in the fifties (1957) and purchased a property in an outer suburbs close to the beach. It was not much back then, fibro 3 bedroom home sitting on 1000sqm and a thunderbox out the back. I retired in 1987 and continued to live in my own piece of Australiana and decided to upgrade my sh!tbox and place internal plumbing inside so the Missus did not have to wander around in the backyard looking for the crapper. I am now 82 and living on the pension and my house is valued at over 2 million and I am on the pension.
> 
> Above is a basic outline of the possibilties of what can and does happen in the real world. The state govt tried the same thing in WA. Massive voter backlash. Oh well ........ there will be plenty more "rich people" to thieve from in the way of taxes in the future. *NOT !*




Your example is extremely rare.

Mostly folk with houses worth more than $10 mill have gained them through either luck, inheritance or crime.

I am all in favour of these big houses being taxed to buggery.

gg


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## drsmith (15 August 2009)

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There are better ways to maintain the integrity of the tax base such as reducing the scope for income deductions.


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## wayneL (15 August 2009)

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drsmith said:


> There are better ways to maintain the integrity of the tax base such as reducing the scope for income deductions.



Yes

And cut out the stinking middle class welfare.


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## trainspotter (15 August 2009)

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Garpal Gumnut said:


> Your example is extremely rare.
> 
> Mostly folk with houses worth more than $10 mill have gained them through either luck, inheritance or crime.
> 
> ...




It was enough to cause the WA state Govt to backdown on their agenda? 

To tax the people for owning a property because it is their principle place of residence and the Valuer General claims it to be worth 2 million is a far flung cry of Trotsky at best. If like your post eludes to, 10 million is a cut off point and your case point can be proven on the valid subjective argument of illegality then it should be absorbed into the state coffers. No question.

But to make claim of a tax due to hard work and benefitting form the spoils of your inherited fortune would open a Pandora's box of tax evasion that is currently unheard of. Spread the wealth for all and sundry has been tried before and has proven itself to be the pariah of the Western world we currently live in. Where do we stop? I sold my 2 million dollar house and no one wanted it (because of the tax) so it is now depreciated to how much? Why stop at 2 million? Why not make everybody with a 500k house a contributor to the tax system? No wait ......... we already do that .... don't we?


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## Bill M (15 August 2009)

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trainspotter said:


> I am now 82 and living on the pension and my house is valued at over 2 million and I am on the pension.




If I was in this situation I would sell the house buy another newer one for 400k and put $1.6 Million in the bank at 4% and live like a friggin King!


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## trainspotter (15 August 2009)

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Bill M is a God amongst men. This is exactly what will happen if they decide to tax the "wealthy" property owners. Driving down the property market in the upper end to flatline and opresss the masses by a tax scale in owner occupied property is a folly that has the hallmark stamp of "policy on the run" IMO. 

OK ... let's introduce this proposed scheme ... I just make the threshold of the tax system. I then decide to let the house go into a "state of disrepair" and lose a further 10% on my valuation. So I started with 2 million of single house property and the VG puts it in writing expressing his opinion. I let the lawn grow and place a few car bodies out the front yard to detract from the streetscape. Is it worth 2 million now? Who decides or is it a broad brush stroke of the pen outlining "suburbs"?? Methinks the devil will be in the detail on the policy on this one.


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## So_Cynical (15 August 2009)

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Bill M said:


> If I was in this situation I would sell the house buy another newer one for 400k and put $1.6 Million in the bank at 4% and live like a friggin King!



Yep 1 mill for a 5 bedroom place on the beach, down the coast a bit and a mill in the bank...life's tough hey.


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## Uncle Barry (15 August 2009)

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Garpal Gumnut said:


> Your example is extremely rare.
> 
> Mostly folk with houses worth more than $10 mill have gained them through either luck, inheritance or crime.
> 
> ...




GG, your living in the bush or just out of touch with the REAL WORLD or just being dumb silly !
You are WRONG !


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## drsmith (15 August 2009)

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wayneL said:


> Yes
> 
> And cut out the stinking middle class welfare.



To me the biggest issue there are the means tests resulting in anomalous marginal tax rates where the benefits are progressively withdrawn.


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## trainspotter (15 August 2009)

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So_Cynical said:


> Yep 1 mill for a 5 bedroom place on the beach, down the coast a bit and a mill in the bank...life's tough hey.




So now you are starting to see my point. Why buy a property for 2 million if you are going to be taxed to the eyeballs on it? Who is going to buy it? Who do you sell it to? Let's start thinking about this logically. The Govt decides to bring this furphy tax into play. LOTS of houses valued at 2 million go on the market. None sell. Market drops.

What do you think this is going to do to the rest of the market? Make it stronger? No one wants to upgrade for fear they will go above the magic number and be taxed. Is it starting to sink in now?

A million in the bank . Pfffffffffftttt .. how long do you think that will last in todays climate? Now we are assuming YOU OWN THE PROPERTY OUTRIGHT  ... correct ? So the funds from the sale as your principle place of residence are all yours to spend. Congratulations, you have your 1 million dollar house on the beach and the money is in the bank. How long before your 1 million dollar house on the beach is valued at the magical number? 

Ohhhhhhhhhhh dear ........ I can see the lights coming on now. 

WAKE UP AUSTRALIA .... WAKE UP ... we must not let this happen under any circumstances. EVER.


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## Glen48 (15 August 2009)

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The trouble is we don't have a fair tax system so voters go looking for deductions such as Storm or TimberCorp and assume buying a house is a good way to save and fight inflation when houses only just keep up with inflation and grow by about 3% PA. CGT  is a good way to stop people wasting their money but It will never happen we are to far entrenched to change any thing and only when it all collapses will they Xspurts look at some thing different.


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## gooner (15 August 2009)

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trainspotter said:


> I am now 82 and living on the pension and my house is valued at over 2 million and I am on the pension.




Then you are a bludger. If you are that rich, why should you get a pension. If you have $2m shares you get zip, so why should you get a full pension if you own a $2m house. Borrow against, sell and trade down. Whatever. Battlers should not subsidise rich retirees.


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## Bill M (15 August 2009)

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I ask you one simple question trainspotter. Do you think there should be any high price where the taxes cuts in? For example do you think that it is fair for someone to buy a $10 million house at age 64 just so that person can get the full government pension at age 65 and pay no taxes? Where do we draw the line?


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## gooner (15 August 2009)

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drsmith said:


> To me the biggest issue there are the means tests resulting in anomalous marginal tax rates where the benefits are progressively withdrawn.




True but if you get rid of family tax benefit (I assume this is what we are talking about), then a lot of families will be in poverty.

In my own case, my family income to support 5 people would go from $750 to $400 a week. And trainspotter wants to subsidies rich retirees in multi million dollar homes - ROFLMAO

Personally, I would rather face higher marginal tax rates when I get a job than not have the money now.


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## trainspotter (15 August 2009)

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gooner said:


> Then you are a bludger. If you are that rich, why should you get a pension. If you have $2m shares you get zip, so why should you get a full pension if you own a $2m house. Borrow against, sell and trade down. Whatever. Battlers should not subsidise rich retirees.




LOLOL Gooner .. go and get a job and work like the rest of us had to. If you read the post correctly you would see that it is an EXAMPLE. It has happened in WA already. The voter backlash made the state Govt pull it's horns in. Oh deary, deary me. Full pension my @rse .. it is means tested. They still receive a pension but considerably less than the FULL pension. LMFAOOOOOO.

Do you believe that rich is a 2 million dollar house that a man worked 55 years for and paid EVERY cent he had to in tax and brought up 4 kids and  never hand a handout in his life? OMFG .... get in the real world. I read somewhere(20% return thread when TH was asking you some q's) that you are a bank trained think tank accountant or similar. Should not be hard for you to get a job then? Or does $700 a week sit comfortably in your hand from the Govt? I did not advocate subsidies for these people who find themselves in this position. This was YOUR words ... not mine. I merely explained that the STAUS QUO is adequate. No need to tax them at all. 

Bill M ... no questions dude. THERE SHOULD BE NO TAX ON YOUR PRINCIPLE PLACE OF RESIDENCE .... EVER. Does not matter about the dollar value.


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## drsmith (15 August 2009)

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gooner said:


> True but if you get rid of family tax benefit (I assume this is what we are talking about), then a lot of families will be in poverty.



I'm not saying we should get rid of it but rather reconstruct it as part of the tax system. This could be done as simply as offering non-means tested tax rebates for dependants. Where such rebates results in a negative tax liability (credit) this would simply be refunded to the household. Simplifying the tax/welfare system in this way would result in obvious winners and losers which makes it politically unpalatable. The tax winfall of the commodities boom would have helped here but that opportunity came and went.


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## Knobby22 (15 August 2009)

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Relax

Nothing will happen.

No government would dare do anything to the Australian sacred cow 
- household property.


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## Bill M (15 August 2009)

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trainspotter said:


> Bill M ... no questions dude. THERE SHOULD BE NO TAX ON YOUR PRINCIPLE PLACE OF RESIDENCE .... EVER. Does not matter about the dollar value.




I believe this is open to tax evasion then. The thing is channelling $10 million into a property and then getting the pension is fundamentally wrong. Pensions were never meant for that, I don't think that my taxes should go to multi millionaires, sorry I disagree.

By the way, I am a self funded retiree and I expect nothing from the Government, I live off my own means.


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## trainspotter (15 August 2009)

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Bill M said:


> I believe this is open to tax evasion then. The thing is channelling $10 million into a property and then getting the pension is fundamentally wrong. Pensions were never meant for that, I don't think that my taxes should go to multi millionaires, sorry I disagree.
> 
> By the way, I am a self funded retiree and I expect nothing from the Government, I live off my own means.




Ummmmm ... being a self funded retiree then you would fully well know that IT IS MEANS TESTED. If you have enough to purchase a 10 million $ property it is UNLIKELY you will get the pension. (where did this figure come from by the way?) The sum of 2 million was bandied around by the boffins who want more tax.

The system that we have in place for the principle place of residence is ADEQUATE. No need to threshold tax it because you can afford to live in a house that is larger than the rest. More than likely the b@stard who can afford this kind of home has been paying taxes through the nose for bloody years. I say he deserves the damn thing. JEEEEEEEEEZUZ !!


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## wayneL (15 August 2009)

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Bill M said:


> I ask you one simple question trainspotter. Do you think there should be any high price where the taxes cuts in? For example do you think that it is fair for someone to buy a $10 million house at age 64 just so that person can get the full government pension at age 65 and pay no taxes? Where do we draw the line?




LOL

Sink 10 mil into a non income producing asset just so you can get the lousy state pension???

LOLOL

Too funny.


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## gooner (15 August 2009)

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trainspotter said:


> LOLOL Gooner .. go and get a job and work like the rest of us had to. If you read the post correctly you would see that it is an EXAMPLE. It has happened in WA already. The voter backlash made the state Govt pull it's horns in. Oh deary, deary me. Full pension my @rse .. it is means tested. They still receive a pension but considerably less than the FULL pension. LMFAOOOOOO.
> 
> Do you believe that rich is a 2 million dollar house that a man worked 55 years for and paid EVERY cent he had to in tax and brought up 4 kids and  never hand a handout in his life? OMFG .... get in the real world. I read somewhere(20% return thread when TH was asking you some q's) that you are a bank trained think tank accountant or similar. Should not be hard for you to get a job then? Or does $700 a week sit comfortably in your hand from the Govt? I did not advocate subsidies for these people who find themselves in this position. This was YOUR words ... not mine. I merely explained that the STAUS QUO is adequate. No need to tax them at all.
> 
> Bill M ... no questions dude. THERE SHOULD BE NO TAX ON YOUR PRINCIPLE PLACE OF RESIDENCE .... EVER. Does not matter about the dollar value.




PPOR is excluded for the purposes of the pension means test. So if you do not have other assets, you can have a $10m house and still get a full pension. Fair? I don't think so. I do think PPOR should be included when assessing pension means tests to stop people sinking all their money in the house to get a pension.

And $350 is family tax benefit - this is means tested and paid to people who are on on low incomes with children, irrespective of working or not (kicked in on 1 July for new tax year). The other $400 is income from my savings (that I saved from working hard, never having a handout etc etc). I do not get any government pension. And hard to live on the total of $750 a week, so also spending my savings.

And funnily enough, no it is not easy to get a job. GFC has cut back severely bank recruitment which is where I have a comparative advantage in getting a job. I face discrimination due to my age. I have tried going for jobs at half the pay that I was on before and get knocked back as "overqualified" or "this role does not fit where you are in your career" (subtext, you are too old). That said, just missed out on a good role a few weeks ago and job market is picking up so hopefully get something soon. Then I will have to pay back all that family tax benefit.


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## trainspotter (15 August 2009)

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I'm with you on this one WayneL. Sink 10 million Aussie pesos into your principle place of residence to get the FULL pension? If you have this kind of coin why would you need the pension? LMFAO. I fail to see the logic in these statements? Why the heck would drain your bank accounts and liquidate all your asset base and buy a 10m house for tax benefits and get a pension? I am losing it.

Gooner:- All credit to you brother if you are not taking the easy "handout" mentality in your approach. Righteous dude ... just plain righteous. Keep on fighting the good fight and I am sure something will come along that is in your sphere of knowledge soon enough. All glory to you and yours.


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## Julia (15 August 2009)

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[




trainspotter said:


> Ummmmm ... being a self funded retiree then you would fully well know that IT IS MEANS TESTED. If you have enough to purchase a 10 million $ property it is UNLIKELY you will get the pension. (where did this figure come from by the way?) The sum of 2 million was bandied around by the boffins who want more tax.
> 
> The system that we have in place for the principle place of residence is ADEQUATE. No need to threshold tax it because you can afford to live in a house that is larger than the rest. More than likely the b@stard who can afford this kind of home has been paying taxes through the nose for bloody years. I say he deserves the damn thing. JEEEEEEEEEZUZ !!



Trainspotter, you are quite wrong.  The family home is not included in means testing.

It's far more common than you might realise for people to buy a more expensive home just so they can obtain a full government pension.

As Wayne says, too funny.
I can't think of anything sillier but it happens.

I wouldn't be in favour of taxing a home over $2 (not $10 million, gg, where did you get that idea?), but I would be in favour of including that part of the  value of the family home which is  over $1 million in the means test for the government pension.

No reason why tax payers should be funding a full pension for people who are hiding their wealth in non-assessable asset.


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## Trevor_S (15 August 2009)

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Well, I am going to go out on my own and say I agree with it.  I actually a agree with a CGT on your PPOR.  Only paying it when it is sold.

Unlike the OP I know qite a few people who rort, by moving in, doing up, selling and moving on, pay no income tax (live of the CG) etc etc  

I also know quite a few older people who rort it the same way.  Multi million dollar houses (they could sell and move someone where very nice, become self funded and save the public purse, they don't want to do that voluntarily, so time for the Government to man up and force them), getting the pension, they feel entitled, as if the pension is a quasi super scheme.

I am also for death duties 
http://www.economist.com/finance/displaystory.cfm?story_id=10024733

The thing is the Government has to generate much more income,  the welfare budget is expanding, there is now a massive debt that needs repaying etc  If they want to stay in power they need to keep the populist vote 

I never put these bunch of idiots in power, but nor did I put the last bunch of idiots their either.


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## stocksontheblock (15 August 2009)

*Re: $2m Home Tax - Whats next?*



So_Cynical said:


> Yet another ALP/Rudd bashing thread  bring on the double dissolution i say.
> 
> If i had a 2 million dollar house i wouldn't be complaining about any new taxes, and genuinely struggle to understand how anyone potentially suffering from this new proposed tax could or would have a problem with it.
> 
> Have money = pay tax




Ohhh no the bleeding heart liberal's have been ordered by Dudd and Co. to come out in defence of the indefensible.

You have got to be seriously kidding me when you think that this is a good idea. God forbid that anyone would want to better themselves and try to aim high, or be in a position to get something that might be a little better than others.

It's obvious that such an ill-thought out statement has come from someone who doesn’t have any money and welcomes anything that will give them a foot-up on the apparent 'rich', when all it will do is take you a step lower.

If those who are fortunate to own or have a property worth more than $2million should be taxed more - obviously to fund the big spending pork barrelling of people like the likes of you, then how about a thank you when more of my taxes are taken to fund your baby bonus', $900 jollies to going shopping with etc, child care rebates, and your weekly ‘training’ money, aka the dole! As my first posting said, I don’t have nor could I afford a $2million home – unlike many of your ALP mates, however I do happen to earn a little more than $100k and I find it pretty bloody offensive to say I am ‘rich’.

How about you and your mates in the ALP stop trying to screw everyone for a few $’s and implement and encourage people to better themselves and aim to own a $2million home instead of having them feel like they are owed for others success and enforcing the idea they are losers or that they have been left out.

There are many examples where people will own a $2miliion home, and these have come from hard work – work which has already been taxed at every level.


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## trainspotter (15 August 2009)

*Re: $2m Home Tax - Whats next?*

Julia ... the pension is means tested. PPOR not included granted BUT if you can afford to throw that kind of lolly around it is unlikely you would be able to obtain the FULL PENSION. I digress.

The great majority of retirees are home owners and the adequacy of pensions has been determined on this basis (with renters receiving separate assistance). Savings invested in owner-occupied housing generally do not generate cash-flow incomes. For these reasons, the Panel supports the continued exemption of owner-occupied housing from the pension means test. However, the provision of an uncapped exemption provides an opportunity for very high levels of wealth to be sheltered from means tests. To increase the fairness of the pension system, the Panel proposes in the development of the new means test to give consideration to setting a limit on the value of the exemption of owner-occupied housing. 

http://taxreview.treasury.gov.au/co...t_Income_Strategic_Issues_Paper/Chapter_6.htm

It seems we are too late. The train has left the station so to speak.


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## gooner (15 August 2009)

*Re: $2m Home Tax - Whats next?*



stocksontheblock said:


> If those who are fortunate to own or have a property worth more than $2million should be taxed more - obviously to fund the big spending pork barrelling of people like the likes of you, then how about a thank you when more of my taxes are taken to fund your baby bonus', $900 jollies to going shopping with etc, child care rebates, and your weekly ‘training’ money, aka the dole! As my first posting said, I don’t have nor could I afford a $2million home – unlike many of your ALP mates, however I do happen to earn a little more than $100k and I find it pretty bloody offensive to say I am ‘rich’.




Stocks, if you earn a little more than $100k as you say, then you too are entitled to baby bonus, child care rebates and family tax benefit. Although you need children to do that. Which means meeting a women (assuming you are male). Which might be difficult given your rabid right wing views.


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## stocksontheblock (15 August 2009)

*Re: $2m Home Tax - Whats next?*



Julia said:


> ... but I would be in favour of including that part of the  value of the family home which is  over $1 million in the means test for the government pension.
> 
> No reason why tax payers should be funding a full pension for people who are hiding their wealth in non-assessable asset.




Sorry Julie, I have cut some of what you said, yet I do happen agree with the pension part, although not part of my org. post, I do happen to agree with peoples comments on the value of a home being included.

I would love to know the real figures for people who are buying such an asset to then claim - I agree with trainspotter et al that I couldnt see the worth in doing something like this. A dead asset, which you couldnt use as cash then claim a pension to, I guess, buy the PAL to have on toast each night, seems like an odd-ball thing to do.

However, that said, the home should be included in the pension, yet where does this end - in real terms. It is not included in unemployment benefit - as far as I know, so if I own a $1million+ home should I have to sell that because I am asset rich and money poor and exhaust that money before claiming the dole?


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## stocksontheblock (15 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Stocks, if you earn a little more than $100k as you say, then you too are entitled to baby bonus, child care rebates and family tax benefit. Although you need children to do that. Which means meeting a women (assuming you are male). Which might be difficult given your rabid right wing views.




No. As I said, which if you had read and possibly of understood, a little more than $100k.

As for the right wing views, sure, if thats what you call wanting to keep what I have worked hard for and earned, ohhh and paying more than my fair share along the way.

If your left wing ideals give you the warm fuzzy feeling by being taxed more, taking what you have earnt, or being given in the fortnightly government hand-out, then go for it, yet dont expect others to do it.

As for the rest of your comment ... grow up.


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## gooner (15 August 2009)

*Re: $2m Home Tax - Whats next?*



stocksontheblock said:


> Sorry Julie, I have cut some of what you said, yet I do happen agree with the pension part, although not part of my org. post, I do happen to agree with peoples comments on the value of a home being included.
> 
> I would love to know the real figures for people who are buying such an asset to then claim - I agree with trainspotter et al that I couldnt see the worth in doing something like this. A dead asset, which you couldnt use as cash then claim a pension to, I guess, buy the PAL to have on toast each night, seems like an odd-ball thing to do.
> 
> However, that said, the home should be included in the pension, yet where does this end - in real terms. It is not included in unemployment benefit - as far as I know, so if I own a $1million+ home should I have to sell that because I am asset rich and money poor and exhaust that money before claiming the dole?




Stocks

Fair comment on unemployment benefit. It does seem a bit harsh to get people to sell up their house to get unemployment benefits. For the old age pension though, reverse mortgages provide a means to access some of the wealth (younger unemployed do not have this ability), so it is not necessary to sell up. If PPOR is included in the pension means test, the government could also consider a scheme whereby it takes a % stake in the house in return for a pension.


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## stocksontheblock (15 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Stocks
> 
> Fair comment on unemployment benefit. It does seem a bit harsh to get people to sell up their house to get unemployment benefits. For the old age pension though, reverse mortgages provide a means to access some of the wealth (younger unemployed do not have this ability), so it is not necessary to sell up. If PPOR is included in the pension means test, the government could also consider a scheme whereby it takes a % stake in the house in return for a pension.




A % stake? How does this work? As someone right at the start of this thread said, what happens if it all goes backwards? My home goes up 10% a yr for 5 yrs, then down 40% and up 10 % and so on and so on. We keep hearing that people in the top end are losing more - as a % of the total value - when times are bad, so how do you apply an share you have in a home? Whether taking a % stake or applying a regressive, and what would end up being a market crashing/glut when people refuse to sell, or dump the home?

What if a place is valued at $2m, yet sells for under that? How do you apply a yearly CGT%?

The one point I made in another posting is that if this is a serious tax - which I happen to think will never be done, yet if it happened, how does this not allow people to have an even great means of reducing their share of tax?

In summary: I said, if you have the money to buy this sort of high valued property, then you will keep the cash, borrow more, higher rate of interest repayments, write them off against your income, use repairs as a further tax reduction, all the while not moving, or selling the home and just reducing your tax.

Yet, in the end, I have been tax on my income, on the savings I had to save up for my home loan, taxed on the loan itself, taxed on the painter to paint the house - GST, paid money out of my own pocket, and somewhere in all this my home - which I brought to live in, maybe have my family and have some security over the years has hit a magic mark and now I am getting penalised for that?

Why not raise the GST by 5%? or 2% would that not raise the same if not more? Or would this simply hurt the people Dudd and Co. want to keep pork barrelling?


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## Buckeroo (15 August 2009)

*Re: $2m Home Tax - Whats next?*



Trevor_S said:


> The thing is the Government has to generate much more income,  the welfare budget is expanding, there is now a massive debt that needs repaying etc  If they want to stay in power they need to keep the populist vote




This is how it goes: 

The more income the government sucks from the economy , the less cash there is for consumers to spend. 

The less cash for spending in the economy, the tougher it is for companies to make profits

As company profits disappear, unemployment rises

The government then needs to increase taxes to cover further welfare spending.

The circle is complete

This is the reason why labor will never pay back its debts - its impossible under a socialist banner! The only way to get out of debt & have a strong economy is to cut government spending & improve business productivity - not increase taxes!

And I'd start with the bloated State budgets!

Cheers


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## pursuitute (15 August 2009)

*Re: $2m Home Tax - Whats next?*

*Swan denies planning tax on wealthy homes:*
http://www.news.com.au/story/0,27574,25932638-29277,00.html


			
				news.com.au said:
			
		

> FEDERAL Treasurer Wayne Swan has denied reports saying the Government is considering slapping a tax on some of the country's most expensive homes.
> 
> The Weekend Australian newspaper says the Government has asked Treasury to model various capital gains tax scenarios on homes valued at $2 million or more.
> 
> ...


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## cuttlefish (16 August 2009)

*Re: $2m Home Tax - Whats next?*

I'm completely opposed to this sort of tax.  $2 million does not necessarily translate into a 'big home' in many Sydney suburbs. This sort of tax just restricts the flexibility for people that get caught up by them - if someone is in a $2 million home but wants to move to a new location or upgrade to a nicer house they suddenly get slugged for what will be in the majority of cases a significant portion of their wealth.

Also what happens if I have a $2 million home and subdivide it into two $1 million residences and then sell each of those?  I can see that becoming common - well I sold my two apartments to the same buyer ... ;-).

So then they'll have to come up with all sorts of stupid clauses to prevent this sort of thing which will then make it more difficult for people to do bonafide subdivisions or developments etc.

Its just an unfair tax on people that have had the commonsense to buy their own home and will just restrict the freedom of those people to sell and move for whatever reason.  

If they introduced this I could see all sorts off bizarre sales/rental practices occuring to try to circumvent the tax as well.


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## drsmith (16 August 2009)

*Re: $2m Home Tax - Whats next?*



cuttlefish said:


> If they introduced this I could see all sorts off bizarre sales/rental practices occuring to try to circumvent the tax as well.



Daylight robbery comes to mind as an 18th century equivalent.

http://en.wikipedia.org/wiki/Window_tax


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## lianeisme (16 August 2009)

*Re: $2m Home Tax - Whats next?*

Trainspotter was more accurate than you think there are 100s of thousands of people in the position he mentioned above and will continue to be in the future these people were hard working average people. 
Now with the “so called rich”??????????
Keep in mind the people that have bought the large 2 mill plus houses in resent times; have also paid massive stamp duty.
The rich would have been in the highest tax bracket in regards to income, are they really happy for the rich! To negative gear their own home wow lets buy bigger and more fantastic homes lets do that no need to go the investment property way. Why bother with tenants they are painful anyway, history repeats lack of housing government will have to start building housing again cost to the tax payer billions 
What about luxury tax for their car they have bought
What about the very high rates to councils.
What about the taxes on insurances
Massive school fees for their children and they get no benefits. 
They pay high taxes, when they retire they get bugger all from the government. That right is reserved for the useless. 
How many times do you want them to bend over and take it? Why do we insist on punishing people for being successful and giving the useless gold medals?
The labour governments came up with superannuation, because the stupid didn’t know how to save for their retirement rather than means testing that, we all got hit with it. 
If they want to bring this new tax in it should be right across the board hey why put a 2mil  value on let everyone be equal isn’t that what communism is, what’s good for one is good for all. Let’s all eat spuds and wear brown jackets.
Be careful you don’t scare even wealthier people offshore we are already taking most of our industry offshore because of unions and bulling tactics and very high taxes.
Be careful what you wish for
Just having my say in this wonderful free and democratic sociality


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## gooner (16 August 2009)

*Re: $2m Home Tax - Whats next?*



lianeisme said:


> Trainspotter was more accurate than you think there are 100s of thousands of people in the position he mentioned above and will continue to be in the future these people were hard working average people.
> Now with the “so called rich”??????????
> Keep in mind the people that have bought the large 2 mill plus houses in resent times; have also paid massive stamp duty.
> The rich would have been in the highest tax bracket in regards to income, are they really happy for the rich! To negative gear their own home wow lets buy bigger and more fantastic homes lets do that no need to go the investment property way. Why bother with tenants they are painful anyway, history repeats lack of housing government will have to start building housing again cost to the tax payer billions
> ...




Oh this is so funny on so many levels.

Stamp duty on expensive home, insurance tax, private school fees. These are all choices. Cheaper home - less stamp duty, insurance taxes - don't buy insurance, school fees - use the government system. Oh and the federal government provide massive subsidies to private schools. About time this rort stopped, next you will be wanting a subsidy for buying books instead of using the library or installing a swimming pool instead of using the council pool. As for whingeing about luxury car tax, as I recall this kicks in around $55k. It may surprise you, but you can buy cars below $55k, even some BMW's and Mercedes.

As for people being too stupid to save for retirement. Well you are sort of right to a certain extent. The reality of a society is that not all of us are smart enough to go to university and become doctors, lawyers and accountants. Some people are destined to collect your garbage, deliver your letters, clean your toilets. And you may not have noticed from your ivory tower, but these jobs do not pay very well and these people, through the genetic outcome of not being intelligent , will not earn enough to pay for their retirement.  If we want to ensure these people are not thrown on the scrapheap at age 65, then the money needs to come from somewhere. And taxes on multi-million dollar houses and reducing rich people's welfare such as non-means testing PPOR and government subsidies of private schools and health insurance seem fair ways of doing it.

And  before you accuse of me of putting my hand in your pocket, I have paid loads of tax over the years and my income tax bill for the last six or seven years would have been at least $100k a year. And I pay private health insurance and private pre-school fees. I just happen to believe in an equitable society. I have been to the United States and it was not pretty.


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## robots (16 August 2009)

*Re: $2m Home Tax - Whats next?*

hello,

yes lets have equality, quite simple everyone pays the same tax each year

maybe 30%, easy

thankyou
professor robots


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## trainspotter (16 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Oh this is so funny on so many levels.
> 
> Stamp duty on expensive home, insurance tax, private school fees. These are all choices. Cheaper home - less stamp duty, insurance taxes - don't buy insurance, school fees - use the government system. yadda yadda yadda
> 
> ...




So because I am successfull and I am able to afford the nicer things in life that I have worked so damn hard for and paid ALL my taxes inclusive of state taxes and council taxes disguised as rates and so on and so forth in YOUR Utopian society I should not purchase myself a bit of luxury and ENJOY the fruits of my labour. Like you say it is all about choice. I think they have tried this previously under the guise of a country called CUBA. The cracker in your statement was *"Don't buy insurance"* PMSL. Are you for real Gooner?

As the Guvmnt legislated for employers to contribute to SGC for the workers it is unlikely that the "unintelligentia" will have NO retirement funds upon reaching 65. I find it deplorable that to use the basis of intelligence as an indicator of wealth a very low brow position to be in. Many primary industry people would fall away under your totalitarian society comrade. There are plenty of farmers and crayfishermen who could not find their backside in three grabs but need a step ladder to jump into bed becasue their mattress is STUFFED full of $100 notes. Filthy capitalists ! 

Now you claim to be from the banking fraternity and having a leftist lien. You also claim that you have paid approx $100,000 per annum in tax for 6 or 7 years. OMFG !! Get a better accountant you goose. If you have given this amount of coin to the ATO you should be on the welfare gravy train getting some of your hard earned $$$ back from the ACT olygopoly. JEEEZUZ !! Or do they qualify you as being too rich? You write that you believe in an equitable society but you have private insurance and private schooling. Hmmmmm

Tax Rate from the ATO.
$180,000+ income = $58,000 + 45% for each dollar over $180,000 tax

In your previous job you would have been on approx 225k per anum. Nice package for a brown shirt. Good work if you can get it. Pffffffffftttt !!


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## Uncle Barry (16 August 2009)

*Re: $2m Home Tax - Whats next?*

Looks like there are some Commies out there


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## stocksontheblock (16 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Oh this is so funny on so many levels.
> 
> Stamp duty on expensive home, insurance tax, private school fees. These are all choices. Cheaper home - less stamp duty, insurance taxes - don't buy insurance, school fees - use the government system. Oh and the federal government provide massive subsidies to private schools. About time this rort stopped, next you will be wanting a subsidy for buying books instead of using the library or installing a swimming pool instead of using the council pool. As for whingeing about luxury car tax, as I recall this kicks in around $55k. It may surprise you, but you can buy cars below $55k, even some BMW's and Mercedes.
> 
> ...




I have got to jump in on this one Gooner, you have made the point I have tried to make so many times and always seem to be shot-down on.

Its a choice, yes. So if you apply your idea of it being a choice, then having a child is a choice - in 99% of cases, so why should there be a baby bonus? Why should childcare be subsidised? Why should there be tax breaks for people with kids? Is the child not a choice, is a child not usually - or it should be - the result of 2 responsible people saying we would like a child, we can afford it regardless of handouts, and so lets have one.

I am happy for private schools to have the money taken away from the public purse if a family sends a child to a private school and claim the cost against their tax, or have a deduction - seems to me like paying twice. Same with health care.

Why should I pay for increasing private health care, and at the same time increasing medicare levy, last tax bill was will into the $4000 mark, for something I dont use - as I have private health insurance.

This is not an equal society and nor will it ever be if the society wants to demonise the apparent 'rich' to give to the apparent poor.

If you want to tax my house because it is worth more than $2million (which I dont have) then make the rest of it a level playing field. We have been propping up a failing car industry for the last 40yrs so that we can sustain jobs which could be shifted elsewhere, and hence we tax better cars to get here, then tax them to buy them and so a car which we class as a luxury is more expensive to move people towards buying a *****y Holden or Ford.

As for the intelligence factor, well what a load of fu**ing bul**hit. Those who get my bins on a weekly basis make very good money, the tradie who paints my house, fixes my car, does my plumbing does very nicely. The Uni factor makes no difference to income. Many accountants and lawyers dont earn more than a Council or Government employee - to which there doesnt seem to have been much education at all (insert sarcasm!).

I have no problem with paying tax, yet there has to be a cut-off at some point. You tax me more, then why should I better myself, I should work less, use less, and buy less quality products, so I earn just what I need to get by - which is a sad way to live, then collect all the goodies from the government. Now, what happens if all those who are not 'rich' apply this sort of idea - where will the money come from to give to these poor unforunates?

Choice - what a joke! I want a choice, yet I dont have one! I have a gun to my head because you want to call me rich, and so I either comply or well, get shot, thats not a choice.

How about everyone get off the world owes me a living mentality and get on with their lot.

There is no reason for unemployment, no one should be, so its a choice - a choice to be unemployed, or employed - whether its something you want to do or not. So remove the dole. Having a child is a choice, and so, if you have one you pay for it, no one else. School is a choice, so pay for the full economic cost of it, or agree to have a public and private system and give incentives to those who can afford it.

Remove regressive taxes aimed at only small groups of the population - your so called rich people. Make the 'poor' earn their fair share and give back.

You cant have it both ways. You might like the idea of working your ass off to be taxed more to have less so the person next to you who does nothing can have something, yet I have some real problems with that! I worked for what I have, and work dam hard. I have earnt every $, so where is my choice.

Ohhh, and I have been on all sides of this. I have worked for the ALP, the Unions, private enterprise, been very very poor, and lived/live comfortably, so my 'right wing' views are not at the expense of screw the 'poor', its because I dont feel like I am owed anything, or that I am envious of others, its because I want better for myself.


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## stocksontheblock (16 August 2009)

*Re: $2m Home Tax - Whats next?*



trainspotter said:


> So because I am successfull and I am able to afford the nicer things in life that I have worked so damn hard for and paid ALL my taxes inclusive of state taxes and council taxes disguised as rates and so on and so forth in YOUR Utopian society I should not purchase myself a bit of luxury and ENJOY the fruits of my labour. Like you say it is all about choice. I think they have tried this previously under the guise of a country called CUBA. The cracker in your statement was *"Don't buy insurance"* PMSL. Are you for real Gooner?
> 
> As the Guvmnt legislated for employers to contribute to SGC for the workers it is unlikely that the "unintelligentia" will have NO retirement funds upon reaching 65. I find it deplorable that to use the basis of intelligence as an indicator of wealth a very low brow position to be in. Many primary industry people would fall away under your totalitarian society comrade. There are plenty of farmers and crayfishermen who could not find their backside in three grabs but need a step ladder to jump into bed becasue their mattress is STUFFED full of $100 notes. Filthy capitalists !
> 
> ...




Couldnt agree more!!!


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## gooner (16 August 2009)

*Re: $2m Home Tax - Whats next?*



trainspotter said:


> So because I am successfull and I am able to afford the nicer things in life that I have worked so damn hard for and paid ALL my taxes inclusive of state taxes and council taxes disguised as rates and so on and so forth in YOUR Utopian society I should not purchase myself a bit of luxury and ENJOY the fruits of my labour. Like you say it is all about choice. I think they have tried this previously under the guise of a country called CUBA. The cracker in your statement was *"Don't buy insurance"* PMSL. Are you for real Gooner?
> 
> As the Guvmnt legislated for employers to contribute to SGC for the workers it is unlikely that the "unintelligentia" will have NO retirement funds upon reaching 65. I find it deplorable that to use the basis of intelligence as an indicator of wealth a very low brow position to be in. Many primary industry people would fall away under your totalitarian society comrade. There are plenty of farmers and crayfishermen who could not find their backside in three grabs but need a step ladder to jump into bed becasue their mattress is STUFFED full of $100 notes. Filthy capitalists !
> 
> ...




Trainspotter

I recall the insurance levy is actually a Fire Service levy, but happy to be corrected on that. Who you gonna call when the house starts burning?

No public pre-schools where I live, only private ones. But kids will go to public school once they are old enough. Private health insurance is an interesting one - I got it because financially I was better off even if I never made a claim because the ATO charges a 1% levy on family income if you do not have health insurance. It also came in useful when we had the kids because it made is easy to go private. 

I actually do my own tax return so do not need a better accountant. Sure could have saved tax by investing in various timber and agricultural schemes, but these all seem to have turned out crap. Not much point saving $50 in tax if you lose the $100 investment in the first place. And hey, someone has to pay tax for all those welfare bludgers.



Oh and the brown shirts were the fascists, not the communists. LOL


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## gooner (16 August 2009)

*Re: $2m Home Tax - Whats next?*



Uncle Barry said:


> Looks like there are some Commies out there




Would be a pretty boring ASF if the only views were the rabid right wing ones.


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## drsmith (16 August 2009)

*Re: $2m Home Tax - Whats next?*



robots said:


> hello,
> 
> yes lets have equality, quite simple everyone pays the same tax each year
> 
> ...



You'll never have a career in politics suggesting things like that (EDIT: On second thought you might. 30% would be rather high for a single flat rate).

A single flat rate of tax is the logical extension of simplied income support through the tax system however salaries for lower income earners would need to rise to ensure a reasonable standard of living. Rebates for dependants as described earlier would also need to be maintained.


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## trainspotter (16 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Trainspotter
> 
> I recall the insurance levy is actually a Fire Service levy, but happy to be corrected on that. Who you gonna call when the house starts burning?
> 
> ...




Fire Service Levy is on every council rate applicable. You do not have a choice in paying it. It forms part of your rateable land portfolio (if you have one) as well as land tax, Water Rates, rubbish collection etc etc. It is expensive to own and hold vacant land property with no income. Relying on CG for growth. Not complaining, just pointing out the facts. The only way around it is to RENT. Hmmmmmmm .. now there is an attractive proposition .... NOT !

It sees you like to have your cake and eat it too, when it suits you. Private for some things and public for others? I choose and pay for private every time. Why? Because I can afford it. It also means I am not a burden on the public system in any way. No child allowance, no FAS, no $900, no handout mentality for this little black duck. Oh yeah, I paid 70k into the black hole of Canberra last year.

Suggesting that you may look at alternative investment models and not tea tree farms and such that have completely hit the spinning blades of bankruptcy of late. But if you are quite happy handing over 100k to the ATO year in and year out (when you were gainfully employed) then by all means subsidise those "welfare bludgers" as you so aptly described them.

This debate has turned non sensical as Wayne Swan has thrown his cards on the table for all to seen and claims that this "agenda" is a great media hack job yet again to frighten the voters into the blue corner. It aint gonna happen. But then again this is what they said about the GST. LOLOL


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## stocksontheblock (16 August 2009)

*Re: $2m Home Tax - Whats next?*



trainspotter said:


> ... This debate has turned non sensical as Wayne Swan has thrown his cards on the table for all to seen and claims that this "agenda" is a great media hack job yet again to frighten the voters into the blue corner. It aint gonna happen. But then again this is what they said about the GST. LOLOL




Well it may have turn non sensical, yet it still doesnt detract from, and as you have rightly pointed out before I could, I think I remember something about there 'never ever, ever being a GST'. I could think of others, yet this is a lazy Sunday afternoon and one example is enough.

If Dudd and Co, want to have a legally binding letter drawn up that says this was never on the agenda, was never in our minds, will never ever, ever, ever be implemented as part of a Labor Party policy platform - lets say, for the next 50 yrs, otherwise, if so, we will serve the rest of our lives in goal, then I will believe this to be non sensical, yet until that happens this will always be one of those little taxes the ALP likes because it doesnt hurt those that vote for them! Apart from most of the Fed ALP who earn buckets and would be affect.


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## trainspotter (16 August 2009)

*Re: $2m Home Tax - Whats next?*

Where there is smoke there is fire. If it was not on the agneda then who authorised a think tank on possible ways to tax the "nouveau riche"? Never say never when it comes to politics. Has a bad habit of biting you on the backside. Backflip, flip/flop, changed my mind blah blah blah , heard it all before.


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## stocksontheblock (16 August 2009)

*Re: $2m Home Tax - Whats next?*



pursuitute said:


> *Swan denies planning tax on wealthy homes:*
> http://www.news.com.au/story/0,27574,25932638-29277,00.html




Well this is all very nice, yet as TS said, there is no smoke without fire. And so, is Mr Swallow suggesting the Oz had nothing better to do and make the story up, dont get me wrong, most of what they write is made up or written by someones 8 yr old, yet this didnt just come out of thin-air!

So the panel has considered it, thought of it, raised it, talked about it blah blah ... and its interesting that it is factually incorrect, which part of it is correct?


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## drsmith (16 August 2009)

*Re: $2m Home Tax - Whats next?*

To me the smoke is not that the think tank was considering it as an option but in that it was leaked to the media.


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## pursuitute (16 August 2009)

*Re: $2m Home Tax - Whats next?*



stocksontheblock said:


> ...and its interesting that it is factually incorrect, which part of it is correct?



The conceptually bit...


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## lianeisme (17 August 2009)

*Re: $2m Home Tax - Whats next?*



gooner said:


> Oh this is so funny on so many levels.
> 
> Stamp duty on expensive home, insurance tax, private school fees. These are all choices. Cheaper home - less stamp duty, insurance taxes - don't buy insurance, school fees - use the government system. Oh and the federal government provide massive subsidies to private schools. About time this rort stopped, next you will be wanting a subsidy for buying books instead of using the library or installing a swimming pool instead of using the council pool. As for whingeing about luxury car tax, as I recall this kicks in around $55k. It may surprise you, but you can buy cars below $55k, even some BMW's and Mercedes.
> 
> ...





MMMM see how people assume 
Where did I mention in this post I was one of the rich. I simply find the have-nots are perjurious towards the ones that have.
I am one of those people that admire what people achieve in their life time whether it be simply to paint pictures or create empires.
But when you make your choice don't expect other to pay for it.
I left school at 14 because my parents couldn't afford for me to go to school yes" get the violins out".  I took an Apprenticeship very few choices given to females who were poorly educated in the 80S. I went to school at night and paid for my own education while working full time 6 days and one night per week.  People have choices to stay where they are and blame their birth rights or to become something they desire we are makers of our own destiny. Its not easy but it can be done. I don't own a luxury car I own a 1996 Toyota. I don't own a 2mil house either. However one day it might be worth that.

Stamp duty on expensive home, insurance tax, private school fees. These are all choices.     These are not choices they are there wether we like it or not.

Where did I mention the word private schools mmmmmmmm. 
Because these people have achieved a status financially they don't get benefits for public schools that everyone else is entitled to, yet they are expected to contribute more to sociality by way of taxes.

People who don't plan for their own retirement are stupid, its a fact.
I pay for private medical also, but some now I seem to be in the tax bracket where I pay more for Medicare.

I haven't accused you of anything why are you so defensive, its not about you ! 
It is general thoughts being expressed on a forum.


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## gooner (17 August 2009)

*Re: $2m Home Tax - Whats next?*



lianeisme said:


> What about luxury tax for their car they have bought
> What about the very high rates to councils.
> What about the taxes on insurances
> Massive school fees for their children and they get no benefits.
> ...




You mention massive school fees. Public schools do not charge fees, at least only voluntary ones. Only private schools charge massive school fees. Just wanted to clarify this given your next quote.



lianeisme said:


> MMMM see how people assume
> Where did I mention in this post I was one of the rich. I simply find the have-nots are perjurious towards the ones that have.
> I am one of those people that admire what people achieve in their life time whether it be simply to paint pictures or create empires.
> But when you make your choice don't expect other to pay for it.
> ...




Rich people are entitled to use public schools as much as poor people. And they pay the same. It is their choice to send their children to an expensive private school. So they can avoid this cost.

Not sure about your medicare point. The general levy is 1.5% - we all pay this except very low income earners. There is an additional 1% if you do not have private insurance and earn over a certain amount $150k I think. This is the government's incentive or stick if you like to get private health insurance.

I agree that not planning for your retirement is stupid. But as I said, not everyone is super smart. Also for many people, planning means accepting that they will only get a pension, as they do not earn enough to save on their own. Though fortunately the SGC helps, although this came too late for many pensioners today.

And I am not being defensive, I am just challenging the opinion you have put forward.


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## stl_08 (17 August 2009)

More tax on the rich?
Being a young 18year old leaving school, I have the desire to be extremely wealthy one day, but after reading this it makes me think, why work hard and be well off, when u just get hit with these sort of things.
What incentive do I have to work hard?


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## GumbyLearner (17 August 2009)

stl_08 said:


> More tax on the rich?
> Being a young 18year old leaving school, I have the desire to be extremely wealthy one day, but after reading this it makes me think, why work hard and be well off, when u just get hit with these sort of things.
> What incentive do I have to work hard?




Well you need to look into all kinds of tax-planning structures.

This is really quite alarmist.

I think the ALP or the Libs get contributions from big rich coffers! AH-HUM! 
So I wouldn't really worry about it too much!

Just have a plan and grease a few palms and you will be just fine!


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## gooner (17 August 2009)

stl_08 said:


> More tax on the rich?
> Being a young 18year old leaving school, I have the desire to be extremely wealthy one day, but after reading this it makes me think, why work hard and be well off, when u just get hit with these sort of things.
> What incentive do I have to work hard?




Let's see - I'll start a list, sure others can add.

- Because you enjoy your job.
- Because your job makes a valued contribution to society so the harder you work, the more of a contribution you make
- Because you want to motivate colleagues to work hard
- Because money is just money. It is not an end in itself. Life is about family, friends and relationships, not money.

Bit worrying if your main concern at age 18 is high tax rates. Whatever happened to youthful rebellion?

Have a beer. Enjoy yourself.


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## trainspotter (18 August 2009)

Gooner .... go and get a job. Quickly.

_It's twelve o'clock, and it's a wonderful day.
I know you hate me, but I'll ask anyway.
Won't you come with me, to a place in a little town.
The only way to get there's to go straight down.
There's no bathroom, and there is no sink.
The water out of the tap is very, hard to drink,
Very hard to drink.

You, wait 'til tomorrow
You, wait 'til tomorrow_

*You say that money, isn't everything,
But I'd like to see you live without it.
You think you can keep on going living like a king.
Oohh babe, but I strongly doubt it.*

_Very hard to drink.

You gonna wait 'til, fat boy,
Fat boy, wait until tomorrow_

silverchair, "Tomorrow", Frogstomp


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## gooner (18 August 2009)

trainspotter said:


> Gooner .... go and get a job. Quickly.
> 
> 
> *You say that money, isn't everything,
> ...




LOL.

If your point is that it is easy to say that money is not important, but you should try living without it, then it is a very good point.

But my advice to an 18 year old is always to find a job you enjoy and challenge you. We spend too long at work to spend it doing something we hate.  I remember working in a factory during school and uni holidays on a production line. Absolutely hated it. I spent my entire morning looking forward to the tea break, then to lunch, then to home time. And always to the weekend. It was soul destroying. But I was a poor student and I needed the money.

Fortunately (due to my previous hard work and saving lots of my hard earned), I am a very very very long way from the gutter.


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## trainspotter (18 August 2009)

My motto is this:- "You don't have to like it, just take the money"

Apply this to everything you do and success is sure to follow.


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## gooner (18 August 2009)

trainspotter said:


> My motto is this:- "You don't have to like it, just take the money"
> 
> Apply this to everything you do and success is sure to follow.




Hmmm

Methinks money is sure to follow.

And if money is your only measure of success, then success will follow

But to what end?


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## Buckeroo (18 August 2009)

trainspotter said:


> My motto is this:- "You don't have to like it, just take the money"
> 
> Apply this to everything you do and success is sure to follow.




So success is a measure of putting up with crap to just to earn a buck?

I can think of a lot of other things I'd rather do to be successful Trainspotter than this - put this down to heat of the moment comment?

Cheers


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## Buddy (19 August 2009)

Well, family homes are subject to gains tax in some other countries. USA for example. But the system has been there for a long time and they also treat the family home same as any investment, where tax deductions are also permissible, eg interest is tax deductible. I can recall when interest was even tax deductible in OZ. So if CGT were to be ever introduced in OZ, it would have to be on a fair basis, with tax deductions for interest, improvements, and certain other expenses (land tax, stamp duty...blah blah). 

The biggest problem with setting up this system, is what is the original cost basis for working out the CGT? If it were to be their original price already existing it would bankrupt most people in Australia if they changed houses. And I am being serious when I say that. Just imagine someone who purchased a house 30 years ago, for say $40,000 and it is now worth $2,000,000 (I could probably show you, if I had the time to do the research, tens of thousands of examples of that), and then they sell (for whatever reason) to buy another house. If they had to pay CGT on $1.96m they would not be able to purchase another similar house and would probably face bankruptcy. I simply don't believe it is feasible to introduce this system and make it retrospective on existing properties.

There are huge problems with setting up this sort of system from scratch, and it is all very well for the socialist class of envy to say tax the buggers. But think about it. You would simply be creating another class of welfare dependants by sending the so called rich (they could be asset rich but cash poor) to the bankruptcy court if they changed houses. You might say fine, they deserve it but you might also find some people getting rather angry about this, to the point of violence. 

I don't think it is a great plan. I suspect also, in the grand scheme of things, it is a vote looser not a vote winner.


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## gooner (19 August 2009)

Buddy said:


> Well, family homes are subject to gains tax in some other countries. USA for example. But the system has been there for a long time and they also treat the family home same as any investment, where tax deductions are also permissible, eg interest is tax deductible. I can recall when interest was even tax deductible in OZ. So if CGT were to be ever introduced in OZ, it would have to be on a fair basis, with tax deductions for interest, improvements, and certain other expenses (land tax, stamp duty...blah blah).
> 
> The biggest problem with setting up this system, is what is the original cost basis for working out the CGT? If it were to be their original price already existing it would bankrupt most people in Australia if they changed houses. And I am being serious when I say that. Just imagine someone who purchased a house 30 years ago, for say $40,000 and it is now worth $2,000,000 (I could probably show you, if I had the time to do the research, tens of thousands of examples of that), and then they sell (for whatever reason) to buy another house. If they had to pay CGT on $1.96m they would not be able to purchase another similar house and would probably face bankruptcy. I simply don't believe it is feasible to introduce this system and make it retrospective on existing properties.
> 
> ...




So sell a house, have $2m cash. Capital gain of $1.96m. Home purchased 30 years ago, therefore CGT of nil, as a pre-1985 asset.  Even if was bought after then, and assuming the same numbers (obviously unrealistic), a gain of $1.96m, apply the 50% CGT discount is $980,000. Even if on top tax rate, tax payable is $456,000 leaving $1,544,000 cash. So where does the bankruptcy court come into it? Can still buy a house for $1,544,000. As an offset would also have tax deductibility of various expenses spent on the house and interest payments. So net impact probably not that great.


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## trainspotter (19 August 2009)

Buckeroo said:


> So success is a measure of putting up with crap to just to earn a buck?
> 
> I can think of a lot of other things I'd rather do to be successful Trainspotter than this - put this down to heat of the moment comment?
> 
> Cheers




Nope ... no heat of the moment comment at all there Buckeroo and Gooner. Set clear objective pathways and follow them to the end. You may not like your boss/income provider/money making machine but guess what ... at the end of the day you can go home and he/she/it is not there. Work to be paid is the answer. I have performed many tasks that have earned income (for me)for people that I did not really care for but their money is as good as anyone elses I have found. There was no quantum leap of not liking someone to new found success in my formula. If it means you have to bite your tongue and still take their money then it is "game on" in my view.

I have lost count of how many times I have contracted to people that I would not have to my place for dinner but I still took their money from them. 

I own a pearl farm right? The worst job is cleaning the shell with a 3000kpa water jet pump (cleans the weed off allowing the oyster to filtrate) It is the worst job on the farm BAR NONE. I am the only one that grabs that jet propelled weapon of destruction and hammers all day. The rest of the crew think I am mad.  You don't have to like it ... just take the money.

It could be written as simply as "Do the worst job first and the rest is easy"

Gooner "to what end" ? you may ask. Until you are satisfied that the job you have done is the best to your abilities. Once this is established then the rewards follow. Normally it is in the way of cashflow _*ie*_ money in the bank.

I hope this has cleared up my point of view in this matter. If it hasn't then I am quite prepared for both of you to come over to the pearl farm and do a weekend of cleaning 15,000 oysters (just for the experience I might add) and sit down at the end of the day knowing you have performed a job well done.

You may not like me at the end of the experience but the rewards are handsome.


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## Buckeroo (19 August 2009)

trainspotter said:


> I hope this has cleared up my point of view in this matter. If it hasn't then I am quite prepared for both of you to come over to the pearl farm and do a weekend of cleaning 15,000 oysters (just for the experience I might add) and sit down at the end of the day knowing you have performed a job well done.
> 
> You may not like me at the end of the experience but the rewards are handsome.




We'll, good for you. If only I could instill this sort of attitude in my kids - but alas, not a hope there.

And 15000 oysters may be out of my league - how about maybe 10 & then a few beers while fishing off that boat of yours?

Cheers


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## trainspotter (19 August 2009)

Buckeroo said:


> We'll, good for you. If only I could instill this sort of attitude in my kids - but alas, not a hope there.
> 
> And 15000 oysters may be out of my league - how about maybe 10 & then a few beers while fishing off that boat of yours?
> 
> Cheers




LOL ... Big difference between black lip oysters that grow pearls and edible (Coffin Bay) type oysters. One tastes like the sole of a leather shoe that has stepped in dog excrement and the other grows a pearl. LMAO .... Anytime Buckeroo ... I will place the champagne on ice in anticipation of your arrival.

Offer is only good if the Guvmnt decide NOT to tax me any further.


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## prawn_86 (19 August 2009)

trainspotter said:


> You may not like me at the end of the experience but the rewards are handsome.




Might take you up on that offer. We are looking at working and travelling since the grad job market has gone to **** :


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## trainspotter (19 August 2009)

prawn_86 said:


> Might take you up on that offer. We are looking at working and travelling since the grad job market has gone to **** :




Open door policy when it comes to "all hands on deck". I could introduce you to the many joys of pearl farming. (especially the fire weed part) Don't let the tiger sharks scare you off either, they are friendly to a point. November 1st is our next trip to start production again. Have a boys trip planned mid September and late October (no pearl farm duties and lotsa fishing and drinking)


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## kincella (20 August 2009)

couple of points here....seems the conversation has moved to what one needs to do to make money from working.....how about a new thread for that topic...
agree with trainspotter....your first needs are money for living and independence.....
the next step is to gain experience in your chosen field....or just a life experience...its all good experiences for you...for life......

secondly...the heading here is a misnomer....its media rubbish....
read the true story here...about houses, wealth tax and negative gearing, and the real RBA statements....its very different to what was reported by our media

http://www.businessspectator.com.au...ument&src=is&is=Property&blog=Concrete Detail


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## moXJO (20 August 2009)

trainspotter said:


> Open door policy when it comes to "all hands on deck". I could introduce you to the many joys of pearl farming. (especially the fire weed part) Don't let the tiger sharks scare you off either, they are friendly to a point. November 1st is our next trip to start production again. Have a boys trip planned mid September and late October (no pearl farm duties and lotsa fishing and drinking)




What a great sounding job. How the hell did you get into that career?
Totally left field of the usual nine to fivers.


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## Buddy (20 August 2009)

kincella said:


> couple of points here....seems the conversation has moved to what one needs to do to make money from working.....how about a new thread for that topic...
> agree with trainspotter....your first needs are money for living and independence.....
> the next step is to gain experience in your chosen field....or just a life experience...its all good experiences for you...for life......
> 
> ...




Agreed.
If you read the article you can see why it (CGT on family homes) aint gonna happen.
So we might as well talk about fishing and lifestyle.
Speaking of lifestyle did you hear the latest golf news............
In the golfing world, Nick Faldo's old caddy Fanny Sunesson is to marry masters champion V J Singh. 
At the press conference V J Singh commented "I'm hoping to make her Fanny Singh by Christmas".


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## stocksontheblock (20 August 2009)

kincella said:


> couple of points here....seems the conversation has moved to what one needs to do to make money from working.....how about a new thread for that topic...
> agree with trainspotter....your first needs are money for living and independence.....
> the next step is to gain experience in your chosen field....or just a life experience...its all good experiences for you...for life......
> 
> ...




I fail to see how the article you refer to has anything to do with the possibility of a CGT on houses worth more than $2m?

The tax, as I understand it has nothing to do with 'bubbles', and supply and demand sides at all, it is simply a tax that is up for 'discussion' to be imposed on homes worth more than $2m.

Unless there is something 'between the lines' that I have missed, can you explain how that article shows this possible tax to be just 'media rubbish'?

I dont believe it will ever happen, for many reasons, yet none of them have anything, in my view, to do with the article.


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## trainspotter (20 August 2009)

Does the title refer to - "Whats next?" I just hope the Guvmnt decides not to tax me any further in my endeavours. 

Yeppers ... Wayne Swan has denied, denied, denied any suggestion that the Guvmnt is looking at introducing the CGT on principal place of residences. I have posted previously as to "who" authorised the think tank to come up with such a ludicrous vote losing proposal? Nearly as dumb as the Australia Card that Hawke wanted everyone to have to keep track of the good citizens of Banana Republic Land.

LMAO at the Vijay Singh joke from Buddy. Very funny indeedy.

Thanks Kincella for the vote of confidence in my theory of "money is required to necessitate the ends to the means"

Hey Moxjo ... It all looks very good on the surface but it required a HUGE capital outlay and ongoing expenses are demanding on the hip pocket. It is fantastic when the sun is shining and the water is warm and the oysters are coughing up perfectly round pearls. It is not much fun when it is blowing 30 knots and raining and the oysters have gone into "stasis" (kind of like a hypersleep) To answer your question as to how I got into the industry would take many beers to explain.


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## kincella (20 August 2009)

it is obvious you did not read the article in full......so here is an extract.......

On Saturday many of us woke up to breathlessly read in The Australian that the government was looking to levy capital gains tax on luxury homes while at the same time allowing mortgage interest deductibility along the lines of the US housing market (which begs the question as to why Australia would want to benchmark itself on US housing policy right now). 

The net effect of these changes would have been little-to-no incremental tax revenues and possibly higher house prices (think of the impact of CGT and mortgage interest deductibility on the investment property market). In any event, the Treasurer, Wayne Swan, categorically ruled out any such policy to the relief of aspiring home owners. This is important news for households since there had been some talk that the Henry Review would consider just such an approach. Here it is best to reflect on the Treasurer’s specific words:

“The story published on the front page of today’s Weekend Australian in relation to capital gains tax on family homes is factually incorrect. There has been no request from the Government to the Australia’s Future Tax System review to model such proposals, we are advised that no such modelling is being carried out by the review, and therefore no recommendation of this sort will be made to us by the panel. The Government is not considering and will not consider the policy outlined in that article today.”
While the proposed policy has been jettisoned by the Treasurer, it is nevertheless instructive to highlight some of its prospective nuances.

First, if the government did levy CGT on owner-occupied housing they would, as the article canvassed, likely allow mortgage interest deductibility as is the case in the few other countries that impose CGT in one form or another. If for some politically suicidal reason they did not, they would be exacerbating the existing tax distortions and position Australia’s housing market as the most heavily taxed in the world (note that this is an entirely abstract discussion since the Treasurer hit the policy for six). The table below, which I have extracted from a 2006 RBA research discussion paper by Luci Ellis, shows that no developed economies impose CGT on owner-occupied housing without also permitting interest deductibility. (And for the policy wonks, I am not aware of any nations that currently tax “imputed rent”””I think Switzerland once did.)


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## kincella (20 August 2009)

trainspotter,
the best idea the children need to learn is....firstly to acquire independence, and the easiest way  to do that, is find the money to provide for their independence...
most take a job...any job to start with, well one that they feel they can handle...
once they acquire some independence.....they can then grow far quicker to achieve other goals...
its just a means to an end....
I find the younger the child is, if he/she  has the nous to earn money, have gone on to become very successful in their lives.....
you know the kids with their own stalls, selling vegetables etc at age 10 or so, they become very savvy with money.....wheeling and dealing etc...

compared to the kids that sit around waiting for handouts from parents, begging for money....


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## stocksontheblock (20 August 2009)

kincella said:


> “The story published on the front page of today’s Weekend Australian in relation to capital gains tax on family homes is factually incorrect. There has been no request from the Government to the Australia’s Future Tax System review to model such proposals, we are advised that no such modelling is being carried out by the review, and therefore no recommendation of this sort will be made to us by the panel. The Government is not considering and will not consider the policy outlined in that article today.”




Yes, I did read this in a number of publications - which is Mr Swallows reply to being asked about the Oz's headline story.

However, I am still to see from Mr Swallow what is factually incorrect – what was correct? And just yesterday in parliament when he was asked to categorically rule out implementing such a tax, he categorically ruled out asking for such a tax to be considered. To me there is a difference.

While it may all be semantics and words going around in circles (if such a thing can happen ) I would like, as I said in a previous post, is to hear from Dudd & Co. the following:

"We stand before our loyal subjects, and proclamate (no such word I know, yet hasn’t stop Dudd making up a few so far) that we have not asked for, requested from, sort, or instructed anyone to consider, deliberate, discuss, or make any overtures in the form of a CGT or tax of any other kind on homes worth over $2million, or any other value. The articles that have been floating around are false, have been made up and have no basis whatsoever. So my people, I tell you now, THERE WILL NEVER BE a tax on the family home”.

Still means nothing, think a similar thing was said about no GST? However it would go a long way to me believing this wont ever happen.


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## Captain G (20 August 2009)

Whether it happens or not time will tell. But, when people hear about a $2 million home, they tend to think of some rich/well off person etc.
Well, a lot of people who are not rich will be unjustly hurt. Eg. I have a relative that lives on his 7 acre farm which he's owned for the past for 43 years, in Sydneys West. The property is now not far off from being released for urban development.

He and his wife have worked there guts out as market gardeners nearly 7 days a week and just got by all those years with an average yealy income in todays terms of about $30,000 between them & raised 2 children. They live in a very small 60yr old fibro house that the size of a shoe box. They drive a 35yr old holden ute and could never offered to do much - never been on a hoilday etc.  They're in their 60's & still work the property. They have been waiting for years for urban release and now have a property value of about $5 mill. Why should people like these be subjected to CGT ?? It's criminal & wrong!! The hard working get smashed again !!!


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## Buddy (20 August 2009)

Captain G said:


> Whether it happens or not time will tell. But, when people hear about a $2 million home, they tend to think of some rich/well off person etc.
> Well, a lot of people who are not rich will be unjustly hurt. Eg. I have a relative that lives on his 7 acre farm which he's owned for the past for 43 years, in Sydneys West. The property is now not far off from being released for urban development.
> 
> He and his wife have worked there guts out as market gardeners nearly 7 days a week and just got by all those years with an average yealy income in todays terms of about $30,000 between them & raised 2 children. They live in a very small 60yr old fibro house that the size of a shoe box. They drive a 35yr old holden ute and could never offered to do much - never been on a hoilday etc.  They're in their 60's & still work the property. They have been waiting for years for urban release and now have a property value of about $5 mill. Why should people like these be subjected to CGT ?? It's criminal & wrong!! The hard working get smashed again !!!




Why? Because the socialist class of envy have to finance their midguided socialist dreamtime. More money for the bludgers.

I hope your relatives make a killing, buy a merc and a big boat, go for trip around the world, buy a nice penthouse somewhere with a good view, and live a long enjoyable life of retirement. Maybe with a little garden to keep the interest going.


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## kincella (20 August 2009)

Buddy, your family have nothing to worry about, it was a pre CGT purchase, so its not subject to capital gains tax...
and the govt will not bring in a tax on 2 million dollar houses....


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## lianeisme (20 August 2009)

Captain G said:


> Whether it happens or not time will tell. But, when people hear about a $2 million home, they tend to think of some rich/well off person etc.
> Well, a lot of people who are not rich will be unjustly hurt. Eg. I have a relative that lives on his 7 acre farm which he's owned for the past for 43 years, in Sydneys West. The property is now not far off from being released for urban development.
> 
> He and his wife have worked there guts out as market gardeners nearly 7 days a week and just got by all those years with an average yealy income in todays terms of about $30,000 between them & raised 2 children. They live in a very small 60yr old fibro house that the size of a shoe box. They drive a 35yr old holden ute and could never offered to do much - never been on a hoilday etc.  They're in their 60's & still work the property. They have been waiting for years for urban release and now have a property value of about $5 mill. Why should people like these be subjected to CGT ?? It's criminal & wrong!! The hard working get smashed again !!!




I totally agree with you there are going to be thousands of people like this that will be hurt. And for what to give to the have nots that have never done anything to grow their own wealth. This will be the end of the Rudd Government. 
Come to think of it has anyone met some who actually voted for them. I haven't nor has anyone I have spoken to.
I am in finance so meet people from all facets of life the governments come up a lot in conversation. No one seems to have voted for them in sunny QLD


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## Captain G (20 August 2009)

kincella said:


> Buddy, your family have nothing to worry about, it was a pre CGT purchase, so its not subject to capital gains tax...
> and the govt will not bring in a tax on 2 million dollar houses....




Thanks Kincella for that !! This is very pleasing to hear. 
I'll have to tell this to my Uncle & Anut, for I'm absolutely certain if they hear of this CGT proposal they'll truly become very upset & distressed. 

What bugs you this is why my parents &  relatives moved to Australia from the then Yugoslavia, to get away from the Communists !! Freedom from the State etc !! It could of been like the bad old days for them again.


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## trainspotter (20 August 2009)

Interesting to note that KRudd did not come out and categorically deny this 'proposed tax' today in parliament when questioned by the opposition. Mr Swan was left to defend his master by accusing the opposition of scaremongering .... hmmmmm the plot thickens.


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## stocksontheblock (20 August 2009)

trainspotter said:


> Interesting to note that KRudd did not come out and categorically deny this 'proposed tax' today in parliament when questioned by the opposition. Mr Swan was left to defend his master by accusing the opposition of scaremongering .... hmmmmm the plot thickens.




Your right! The plot thickens!!!

It is not as though the question today, or yesterday or the day before was that difficult to answer.

Do you absolutely rule out bringing in such a tax? A yes or no will do. Not a 10 min slanging match with the opposition, and how they will do all sorts of things. The questions are clear, and I would have thought the answer to be as well.

Do you absolutely rule out that you are considering such a tax? See answer required for above question.


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## Judd (20 August 2009)

I wouldn't be bothered imposing a tax on the home (difficult to administer.)  I'd just include the assessed value if/when the owner/occupier registered on the Title Deed applied for Government benefits.

It has been mooted for a number of years, especially in regard to applications for the Age Pension.


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## stocksontheblock (20 August 2009)

Judd said:


> I wouldn't be bothered imposing a tax on the home (difficult to administer.)  I'd just include the assessed value if/when the owner/occupier registered on the Title Deed applied for Government benefits.
> 
> It has been mooted for a number of years, especially in regard to applications for the Age Pension.




You missed me on that one? Government benefits? Do you mean if you have a property worth more than $2m and you apply for the OAP?


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## stocksontheblock (20 August 2009)

I guess the one thing that I should add to this thread is that some people have assumed that this would apply retrospectively.

It wont, or at worst it would be for the past yr or 2, or back to the start of the FY inwhich it was first implemented.

However, whos valuation will this be based on? and what if I dont get the value that has been place on my property?

Lets say I own a house and it has been valued at $2.5m. In theory it has a value which is subject to a CGT of $500K. If I sell, and the market is bad, or I need a quick sale, or I just havent sold it for a long time so I sell it for $1.9m, then what?

Or, my property on the market is not worth the rubber figure from the valuer? Remember valuations and sale prices are different for all sorts of reasons, so which should apply?

Sure, whether there is a CGT on my house, because of some valuation, what happens if I dont achieve the price someone assumes it to be worth?

How would this effect my insurance? The valuation to build is also different from the valuers belief, and the possible sale price.


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## Buckeroo (20 August 2009)

Well, you vote idiots in you get idiot ideas!

I would say there will be all sorts of idiot tax ideas coming up, the government will be desperate to pay off debt.

So, we now have a 3 ring circus when it comes to fiscal policy - KRudd, Swany and King Henry.

Cheers


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## tasmart (20 August 2009)

*Re: $2m Home Tax - Whats next?*



robots said:


> hello,
> 
> yes lets have equality, quite simple everyone pays the same tax each year
> 
> ...




BUT ............ some will be more equal than others............


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## Judd (21 August 2009)

stocksontheblock said:


> You missed me on that one? Government benefits? Do you mean if you have a property worth more than $2m and you apply for the OAP?




The principle family home is currently excluded from the assets test for those applying for the age pension and other benefits

http://www.centrelink.gov.au/internet/internet.nsf/payments/chartab.htm#a

Wouldn't be all that difficult, apart from the public outcry, to include the family home above a certain valuation level as part of the assets test.

For interest, here is the income test levels.

http://www.centrelink.gov.au/internet/internet.nsf/payments/chartc.htm


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## stocksontheblock (26 August 2009)

Judd said:


> The principle family home is currently excluded from the assets test for those applying for the age pension and other benefits
> 
> http://www.centrelink.gov.au/internet/internet.nsf/payments/chartab.htm#a
> 
> ...




I am all for the family home being included in the means test for the pension, however this tax is not about the pension, and the poor OAP's. It is a tax which would apply to all people, whether 25 or 75 that have a house valued - at some random calculation - above $2m.


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## Taltan (26 August 2009)

The tax makes sense. Why should the capital profits on the family home be tax-free. So you buy a 3m home that goes up 10% and you make $300,000 tax free whilst the less fortunate buy a $200,000 home and make a subsequent $20,000 tax free. Why should the wealthier person get a 280,000 govt present? 

I dont think it will happen though. The thing is most people with $200,000 do not understand this equation, whilst those with the $3m family home have a self-interest here. I also doubt Rudd's home is in the $200k range. So yeah it won't happen but don't pretend it doesn't make sense


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## stocksontheblock (26 August 2009)

Taltan said:


> The tax makes sense. Why should the capital profits on the family home be tax-free. So you buy a 3m home that goes up 10% and you make $300,000 tax free whilst the less fortunate buy a $200,000 home and make a subsequent $20,000 tax free. Why should the wealthier person get a 280,000 govt present?
> 
> I dont think it will happen though. The thing is most people with $200,000 do not understand this equation, whilst those with the $3m family home have a self-interest here. I also doubt Rudd's home is in the $200k range. So yeah it won't happen but don't pretend it doesn't make sense




Of course Dudd's home is worth a lot more than $200k, well his wife’s is, yet I don’t believe his house price will make an ounce of difference to him and his mates approving such a tax.

Why should my home, if worth more than $2m be subjected to capital gains, and someone whose home is worth less than the $2m not be? My home is my home. Most people have not brought a home as a capital investment; they have brought a home to live in, and to hopefully make some money to move out and move up, yet the primary reason is because rent is a dead-end and they want to raise a family somewhere they call home. There comes a point when all of Dudd’s efforts to scam more money out of the apparent ‘rich’ to pay for his debts and the so called ‘poor’ will back-fire. How about all the rich stop working for a year, stop propping up the poor and see what happens then!?

As I have said previously, if the family home is to be treated as an investment then how can you make a distinction between the ‘class’ of investment. The poor who buy shares are subject to the same CGT as the rich who buy shares. Why is that not different? The poor who manage to get an investment property and hope to make some additional money for later in life pay the same CGT as the rich who buy investment properties. So why should the family home be set at $2m, why not $100k.


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## Taltan (26 August 2009)

Well basically cause taxes are paid by the rich not the poor. I do agree with you that no distinction should be made for those with houses under $2m. The $2m was clearly only put in the suggestion to avoid the political backlash of telling common folk they are considering tax on their family homes.

The $2m does not make sense however the actual taxing of the PPR does. Currently all we have is an exemption that hurts those who are unable to afford a home and than proportionally helps you the wealthier you are. Without getting into an argument about a tax-free society, it is exactly the situation that cries out for tax to be imposed.

Rent money is only dead money because of the tax-free status of the main residence. Otherwise many people would be happy to rent and put their capital elsewhere. Its because of our tax system not the underlying economics of the matter


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## wayneL (26 August 2009)

There is another reason why PPR should not be capital gains taxed that has not been mentioned.

If a family needs to move home, no matter what price range it's in, they should be able to buy like for like without impost. Already there is a significant impost in the form of transactions costs and stamp duty. CGT would be totally unfair to add on top.


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## gooner (26 August 2009)

wayneL said:


> There is another reason why PPR should not be capital gains taxed that has not been mentioned.
> 
> If a family needs to move home, no matter what price range it's in, they should be able to buy like for like without impost. Already there is a significant impost in the form of transactions costs and stamp duty. CGT would be totally unfair to add on top.




Fair comment.  One way around it would be to provide CGT rollover relief when you buy a new PPOR - a bit like a scrip takeover


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## stocksontheblock (23 September 2009)

It must be silly season on CGT on peoples homes. Now they want to impose it, well someone does anyway, on homes worth more than $1.1m.

http://www.theaustralian.news.com.au/story/0,25197,26113009-2702,00.html

I suppose to be able to afford a home over $2m you might be considered to be rich, yet a home worth more than $1.1m? You have got to be kidding me!

I love the comment that:



> A report by the Brotherhood of St Laurence and the Australian Housing and Urban Research Institute shows the CGT exemption is worth on average $10,000 a year for the wealthiest 20 per cent of home owners.
> 
> In contrast, it is worth just $1200 a year for the bottom 20 per cent of households.




However, this doesnt say that this 20% of wealthiest home owners are rich. Just that these people are assumed - how I dont know - to be rich.

Yet it also goes onto, which I think is a contradiction, to say:



> "We urgently call on the federal government to remove the capital gains tax exemption on homes worth more than $1.1m, which at roughly 2 per cent of all owner-occupied dwellings is at the very top end of the property market."




The fact that it is at the top end of the property market doesnt mean it is also the top end of incomes.


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## gooner (23 September 2009)

stocksontheblock said:


> The fact that it is at the top end of the property market doesnt mean it is also the top end of incomes.




True, but it would be fairly good correlation. Obviously, plenty of exceptions in the big cities where you would have some income poor, but asset wealthy people. However, CGT is triggered when you sell, so when that happens the income poor people would have plenty of money to pay a CGT bill.

Possibly it would lead to richer families not moving house, but staying put and renovating and then passing house down to children as this does not trigger CGT now (and presumably would not under any new laws). I've been thinking about moving but by the time you pay stamp duty, legals, moving costs, real estates, utility changes and other changeover costs, I would be looking at $100k. That's a good start on a renovation. If I had CGT on top, would be an even bigger incentive to stay put and renovate.


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## lasty (23 September 2009)

I like how they spin it as CGT exempt.
This issue is that CGT applies only if you sell the asset or dispose of it.
Of course the accountants will be busy setting up trusts or offsetting CGT events in other ways.

"Brotherhood of St Laurence executive director Tony Nicholson said the tax concessions were unfair, wasteful and actually put home ownership out of reach for many Australians."

Umm yes.. Last time I looked the average wage was $50k in Australia so try getting a $1 million mortgage on that income Tony.

So far the govt (our tax dollars) contribute 48% of  the brotherhoods  annual income according to your website.
$91 million surplus on your balance sheet Tony?
Perhaps you should give some financial advise to some of our fund managers.
Not bad for a charity.


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## Stormin_Norman (23 September 2009)

id gladly pay taxes if the govt stopped wasting my money.

politicians should be gaoled if they cannot run a balanced budget.


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## 888 (28 September 2009)

If you can't pay tax when you're living in a $2M house, maybe you shouldn't buy the house in the first place.  If you've been living in the house for 40 years and the price increased to $2M, that's another story, I think govt should exempt people been living in the house more than 15-20 years.


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