Those in the lower income deciles can't receive much in the way of tax concessions, as they don't actually pay much tax.
Yes I think we went around that loop last time, it doesn't seem to help.
I think it ended up with, a super contribution for them is just an increase in welfare payment, so why not just increase their welfare? rather than tie it up in super.
if anyone can give me an economic rational as to why the below is equitable and good for the budget I'm all ears.
The top 20%, some 2 million people, get 60% of around $35 billion in tax concessions, or around $21 billion.
average concession per person = $10k plus.
why should the bottom 80% be happy to support that?
+1.You missed juniors point, most of the bottom 80% aren't paying tax.
You said above:
the average tax concession per person = $10k. The average tax per person in the top 20% probably= 40%
Average tax per person in the bottom 50% probably = $0 or minus$.
How are they supporting anything?
The analysis also reveals for the first time which family types are most reliant on the public purse.
The results would shock many in Australia, according to NATSEM principal research fellow, Ben Phillips.
“Most people rightly or wrongly think they pay too much tax and don’t receive enough benefits,” Mr Phillips said. “So people might be surprised to learn only about half of Australian families pay more tax than they receive back in benefits.”
+1.
Mid year NATSEM data shows:
The only outcome of superannuation tax concessions to the top decile is likely to be making an already relatively comfortable retirement more comfortable.
They use to have Reasonable Benefit Limits (RBL's) before. From memory when the Super Guarantee first started it use to be around 450K and it was indexed every year (I think). That, somewhere along the line, was abolished and now there are no limits.
What do readers think would be a fair RBL these days? $1 M, $2 M, $3 M or what? For me $2 Million sounds fair but others will think much more is needed.
Getting onto the discussion about tax and low income earners, we have never had it better. An individual can earn up to 20K before having to pay any tax at all, (that is by getting the low income tax offset as well). If you are married then that's 20K each. Structure your investments (or you work income) so you are both receiving 20K each and you are on $40,000 a year without paying any tax, not bad at all.
You missed juniors point, most of the bottom 80% aren't paying tax.
You said above:
the average tax concession per person = $10k. The average tax per person in the top 20% probably= 40% which may be $60k plus
Average tax per person in the bottom 50% probably = $0 or minus$.
How are they supporting anything?
I suppose the easy answer is to do what happened here and in the U.K, 40 years ago, just hit everyone on high incomes 60% tax.
Then they all relocate their head offices overseas, jeez
I was an electrician, always worked for wages, why can I see that constant handouts and constant tax increases can't work.
Obviously there is something wrong with my logic.
Syd's had the best idea with RBL's
Then he blows his feet off,IMO, with non sensical emotional garbage
They use to have Reasonable Benefit Limits (RBL's) before. From memory when the Super Guarantee first started it use to be around 450K and it was indexed every year (I think). That, somewhere along the line, was abolished and now there are no limits.
What do readers think would be a fair RBL these days? $1 M, $2 M, $3 M or what? For me $2 Million sounds fair but others will think much more is needed.
Getting onto the discussion about tax and low income earners, we have never had it better. An individual can earn up to 20K before having to pay any tax at all, (that is by getting the low income tax offset as well). If you are married then that's 20K each. Structure your investments (or you work income) so you are both receiving 20K each and you are on $40,000 a year without paying any tax, not bad at all.
They use to have Reasonable Benefit Limits (RBL's) before. From memory when the Super Guarantee first started it use to be around 450K and it was indexed every year (I think). That, somewhere along the line, was abolished and now there are no limits.
What do readers think would be a fair RBL these days? $1 M, $2 M, $3 M or what? For me $2 Million sounds fair but others will think much more is needed.
Getting onto the discussion about tax and low income earners, we have never had it better. An individual can earn up to 20K before having to pay any tax at all, (that is by getting the low income tax offset as well). If you are married then that's 20K each. Structure your investments (or you work income) so you are both receiving 20K each and you are on $40,000 a year without paying any tax, not bad at all.
It should be tied to some multiple of the age pension ie if you have accumulated enough money to be able to live on 200% of the pension for 25 years then you shouldn't be able to get any more super tax concessions etc.
That doesn't sound unreasonable.It should be tied to some multiple of the age pension ie if you have accumulated enough money to be able to live on 200% of the pension for 25 years then you shouldn't be able to get any more super tax concessions etc.
You're making an assumption there. I think most people really want to live in a home they own because they can change it, do what they like, have a sense of security.We have to stop treating the primary residence as being invisible to pension system. Pretty much every Australian views housing as an asset rather than a home these days, so start treating it like one.
Yep, agree.Kill off the tax churn that is a major feature of the system. Get rid of the dead hand of Govt at each step of taking and giving. We might be better off with a tax free threshold of $35-40K for singles and 50K for those with children. Gut the welfare system so it only provides assistance to those on the bottom 3 income deciles.
You're making an assumption there. I think most people really want to live in a home they own because they can change it, do what they like, have a sense of security.
How would your land value idea work, given the huge variation in values between mid capital city etc and the boondocks?
Also, I know a lot of people disagree, but I'd like to see an obligation for a proportion of pension to be taken as allocated pension. Just not fair for people to spend the lump sum so they can then access age pension.
I know "it's my money, I'll do what I like with it" is popular, but it's about time we faced up to being a bit more realistic. If you get the tax concessions, then you have an obligation to spend those accordingly.
The other way is to bring back death duties.People talk about housing as a financial asset these days. It's all about the value of your property. It's the BBG topic of choice. Yes people still like the benefits of home ownership, but in general terms the family home is the biggest asset most people will have in their lives.
Where you live is to a degree based on wealth You don't get millionaires living at Liverpool. You don't get median wage earners living at point piper. Wealthy people know buying an asset that can't be increased ie water front land or in desirable suburb - is a great way to store wealth. That's why properties in NYC with views of central park go in the tens of millions.
So someone living outside of a capital city will in general terms have less wealth than one living in the city. There's also the issue where the current system traps people in their current housing because of the generous invisibility of the primary residence. Start treating the land component as visible and then it makes it easier for people to downsize or move to a cheaper suburb.
By focussing on the land value you don't need to start up a whole new bureaucracy and systems to calculate what should be included in the assets tests. There's also well understood methods to seek a variation if you believe the land valuation is incorrect..
Now now Julia, everyone on this forum has been saying this doesn't happen, or for those that do it the balances are not that big so it doesn't matter. I find it unfair that someone not owning their home has their $100K super balance fully accounted for, but someone with a $1M property (there's plenty of them in Sydney and Melbourne) can spend some money on renovations and get the full pension. Much fairer to maybe treat the super balance at retirement a bit like the way gifting works (Any gift or gifts with a total value greater than the allowable amounts will be assessed as a deprived asset for 5 years from the date of gift and will be subject to the income deeming provisions). I'd prefer to see the 5 years increased as the balance of super spent increases and also still be part of the pension assets test. That way there wouldn't be an incentive to scoot off on a holiday or spend $50K renovating the house.
That doesn't alter the basic premise that the ownership of the home is primarily a personal security and even 'emotional warmth' concept.People talk about housing as a financial asset these days. It's all about the value of your property. It's the BBG topic of choice. Yes people still like the benefits of home ownership, but in general terms the family home is the biggest asset most people will have in their lives.
Could you explain how this would work? That's what I asked earlier. When you have X sqm of house of similar standard in Sydney CBD on the one hand and the same in regional Australia, obviously they will be worth vastly different amounts. How are you going to address the tax you suggest on both of these?By focussing on the land value you don't need to start up a whole new bureaucracy and systems to calculate what should be included in the assets tests. There's also well understood methods to seek a variation if you believe the land valuation is incorrect.
Could you explain how this would work? That's what I asked earlier. When you have X sqm of house of similar standard in Sydney CBD on the one hand and the same in regional Australia, obviously they will be worth vastly different amounts. How are you going to address the tax you suggest on both of these?
The Super system encourages me away from the pension system, isn't that a good thing?
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