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Ken Henry Tax Reform

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Sir Osisofliver

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If you weren't aware, Wayne Swan promised that Ken Henry's tax review will be presented to the public "before the May 11 Budget". So we will finally get to see it in the next couple of weeks.

Thought I would start a thread so we can all dissect it when it is released.

What I've heard of this review is downright scary.

The latest possible leak is this one...

http://www.news.com.au/money/money-...ne-use-of-agents/story-e6frfmd9-1225857191011

So if this one goes ahead...the ATO will make a mint...but it's not exctly in the best interest of the average hard-working Aussie Battler

Cheers

Sir O
 
but whats in it for poor working families, surely Kevin wont do anything bad that could affect working families?
 
I am a tax accountant and to be honest salary and wage returns are our least profitably and costly type of return to complete, this system would not impact greatly on many tax agents as most of their income and profit comes from businesses (trusts, partnerships, companies & superfunds). I for one would be interested to see how they are actually proposing to do this and if it all adds up, why not impose it.
 
I wouldn't be surprised to see some sort of new or varied land tax to curb the amount of so called overseas 'Land Banking' and attempt to ease the housing land and rental supply shortage.

I also suspect there will be an attempt at wealth spreading. It's been mentioned a few times in principle but as yet nothing in policy has surfaced. Not sure exactly where they're heading, whether increased luxury item taxes or simply plugging tax haven loop holes and the like.
 
steptoe88 said:
but whats in it for poor working families, surely Kevin wont do anything bad that could affect working families?
Click to expand...

No of course he won't...until after the next election when he has a whole new raft of non-core promises to break. :cautious::D

rock86 said:
I am a tax accountant and to be honest salary and wage returns are our least profitably and costly type of return to complete, this system would not impact greatly on many tax agents as most of their income and profit comes from businesses (trusts, partnerships, companies & superfunds). I for one would be interested to see how they are actually proposing to do this and if it all adds up, why not impose it.
Click to expand...

But that's my point rock86. For Industry its not a particularly profitable exercise. (with the possible exception of doing that tax return for wealthy people because you can charge more). For Householders on the other hand....every little bit helps. So your comment above and the policy if this goes ahead can be interpreted as...screw the people a small amount, help most of the Industry (and the tax office a lot).

Mmm thats looking after the population.

Cheers

Sir O
 
I am more interested in how the review recommendations itself will be avoied/changed by political self-interest.

The Rudd government has thus far in its tenure displayed a level of economic mismangement that is diabolical and the idea that they will ignore large parts of the review in the belief they know better (or simply for populistic reasons) is a frightening one.
 
Sir Osisofliver said:
What I've heard of this review is downright scary.

The latest possible leak is this one...

http://www.news.com.au/money/money-...ne-use-of-agents/story-e6frfmd9-1225857191011

So if this one goes ahead...the ATO will make a mint...but it's not exctly in the best interest of the average hard-working Aussie Battler

Cheers

Sir O
Click to expand...
This simplification makes sense but would be more transparent and simpler if the standard workplace deduction was reflected by an increase in the tax free threshold rather than a seperate deduction.
 
Mofra said:
I am more interested in how the review recommendations itself will be avoied/changed by political self-interest.
Click to expand...
The Rudd Government's (any government for that matter but this one perhaps more so than most) core objective will be to collect more tax than it does now.

Other than that it won't be concerned about the detail beyond how it will impact their electoral prospects.
 
Wander if tax reform will fix that amazing need for paperwork shuffling because tax starts at about $7,000 income and some form of Government assistance applies up to about $50,000 ?
 
Sir Osisofliver said:
If you weren't aware, Wayne Swan promised that Ken Henry's tax review will be presented to the public "before the May 11 Budget". So we will finally get to see it in the next couple of weeks.

Thought I would start a thread so we can all dissect it when it is released.

What I've heard of this review is downright scary.

The latest possible leak is this one...

http://www.news.com.au/money/money-...ne-use-of-agents/story-e6frfmd9-1225857191011

So if this one goes ahead...the ATO will make a mint...but it's not exctly in the best interest of the average hard-working Aussie Battler

Cheers

Sir O
Click to expand...

How so :dunno: the vast majority of tax returns are simple to do...and in my experience tax agents don't have a magic wand to find deductions where none exist....also its getting easier and easier to do it your self, the electronic etax has an auto complete feature now that's really good and saves heaps of time.

DIYT FTW:)
 
Happy said:
Wander if tax reform will fix that amazing need for paperwork shuffling because tax starts at about $7,000 income and some form of Government assistance applies up to about $50,000 ?
Click to expand...
No, but it should.

There's too much government love for means tests.
 
So_Cynical said:
How so :dunno: the vast majority of tax returns are simple to do...and in my experience tax agents don't have a magic wand to find deductions where none exist....also its getting easier and easier to do it your self, the electronic etax has an auto complete feature now that's really good and saves heaps of time.

DIYT FTW:)
Click to expand...

Because, and I hate to sound like a broken record, you don't know what you don't know.

Yes the vast majority of tax returns are simple to do, because the sheeple are not educated enough to know what they should be doing with their finances.

http://www.thebull.com.au/articles_detail.php?id=10976
 
As a starting point deductions and rebates should not be allowed. That's the simplest solution of all.

They should only be introduced where an overall economic or social benefit can be demonstrated. For example, if we want people to breed there should obviously be concessions for non-working spouse and children.

Additinal levies such as the medicare levy should also be intergrated into marginal tax rates.

A key test of the Henry Review will be it's recommendations and their implementation against the above principals.

Work related deductions could be removed with the proceeds used to offset the medicare levy. The remainder of the medicare levy could then be integrated into marginal tax rates.

In short we should have a taxation/welfare system with fewer loopholes and lower overall rates of tax. This would be simpler and fairer. Politically though this does not suit governments as it does not allow them to target specific groups in order to win elections.
 
Heard this morning on the TV (Gillard & Abbott debate) that super contributions will now be taxed at 30%. Abbott and Karl asked her to answer yes or no and she went into some long convaluted explanation that it is not up to her to release this kind of information and we have to wait until Sunday for the report. Karl then asked her if she knows what is in the report? She answered yes she does. Abbott then asked her if this is true. Gillard then protested her innocence that she did not know what the contents of the Henry Tax review were and even if she did she would not spill the beans. Ho hum. Abbott then questioned her if she did not know the contents then how is it that she has been leaking certain bits over the last 4 months to the media. Innocent looking Gillard then went on the attack saying that tobacco companies have contributed to the Liberal Party ?? WTF ?? Abbott backed up like a sheep with it's head caught in a barbed wire fence and went into meltdown about some "Mafia like CFMEU" type organisation that makes donations to the Labor PArty ?? WTF ???

ANYWAYS ..... big changes to superannuation on the horizon. YAY !
 
trainspotter said:
that super contributions will now be taxed at 30%.
ANYWAYS ..... big changes to superannuation on the horizon. YAY !
Click to expand...

I heard talk that it would be taken down to 0% tax as well. So maybe a sliding scale depending on income?
 
trainspotter said:
Heard this morning on the TV (Gillard & Abbott debate) that super contributions will now be taxed at 30%.
Click to expand...
I hope they don't do something really stupid like Howard's high income superannuation surcharge from his first term in government.

According to the SMH, tax scales may be introduced for super with the first $5000 tax free and then moves up the scale to 30%. That would be fairer.

trainspotter said:
Innocent looking Gillard then went on the attack saying that tobacco companies have contributed to the Liberal Party ?? WTF ?? Abbott backed up like a sheep with it's head caught in a barbed wire fence and went into meltdown about some "Mafia like CFMEU" type organisation that makes donations to the Labor PArty ?? WTF ???
Click to expand...
I didn't see it but judging by that they still know how to get him to bite.
 
Julia said:
You're so right. That is what Mr Abbott needs to learn, i.e. not to take the bait. He is much too reactive.
Click to expand...

Yes he still has not learnt to not take the bait. He should have just ignored it and stuck with his initial question.
 
Julia said:
You're so right. That is what Mr Abbott needs to learn, i.e. not to take the bait. He is much too reactive.
Click to expand...

Too true Julia ! Went from Karl & Abbott asking sensible questions which she could not answer (only with rhetoric) then it turned into Abbott looking like a complete goose and struggling for words when Julia Gizzard asked "So you are going to continue accepting contributions from the tobacco companies to the Liberal Party?" BA aba ab bab ababaabab Aaaaaaaaahhhh ....... (stupid look on face) "We will accept any legitimate donations from legitimate business's that wish to contribute to the Liberal Party" Julia Gizzardguts asks question again. Abbott goes into Chernobyl size meltdown and carries on about gangsters, CFMEU, mafia type contributions ?? WTF ??

Karl & Lisa play nicely in the background - pathetic really. Punch and Judy show.
 

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