The Abbott Government

[McLovin]

I agree with all except maybe just broadening the GST base instead of raising it, and encouraging the states to introduce a land tax and get rid of the stupid stamp duties, especially on insurance.

When people talk about broadening the base I see that as implementing what would be an extremely regressive tax on the poor. I really wouldn't want to see basic food being taxed.

No arguments about stamp duties, state government revenue is far too exposed to the ups and downs of the property market.

 

[sydboy007]

When people talk about broadening the base I see that as implementing what would be an extremely regressive tax on the poor. I really wouldn't want to see basic food being taxed.

No arguments about stamp duties, state government revenue is far too exposed to the ups and downs of the property market.

The problem is that spending on non GST goods and services is rising faster than GDP, so to leave it out means the current GCT base is part of a diminishing share of the economy.

I can sort of understand exempting food, or maybe we need to follow the UK and have a couple of rates for GST with the "essentials" at 10% and the rest at a higher rate.

We at least need to start having a "grown up" discussion on the issue. Relying on corporate and income taxes as much as we do is a recipe for stagnation.

A few weeks back, Treasury Secretary, Martin Parkinson, claimed that the typical full-time employee would be paying tax of 39 ¢ in the dollar by 2015-16, up from 31 ¢ in the dollar. He also noted that:

Continued increases in the personal income tax burden will hit lower and middle income earners with higher marginal and average tax rates. This will have adverse labour force participation impacts, while sharpening incentives for tax minimisation by higher income earners.

As the socialist Gittins said recently

The average full-time wage next financial year, 2014-15, will be about $76,000. On the basis of reasonable assumptions about the growth in wages over the three years to 2017-18, you can calculate that someone on half the average wage would see the proportion of their wage that they lose in tax increase by 3.5 cents in the dollar.

For someone on the average wage the increase would be 2 cents in the dollar. On twice the average wage it’s 1.1 cents. And on six times the average wage it’s 0.8 cents.

Now that’s regressive.

GST is a far more efficient tax. I'm sure with broadening the base there is ample room to ensure the bottom 3 deciles are not left worse off.

The below graph from the Henry Tax review shows just how inefficient corporate and income taxes are, so there's ample room for land taxes and GST to be set to recover less income, but in fact recover more due to less consumer welfare loss.

The current debt bad, surplus good, sell all Government monopolies and assets good, under invest in public infrastructure good when it makes attaining a surplus easier has to stop. Heck, I'd like to see a massive reduction in immigration till all levels of Government come up with a coherent plan on how to fund the infrastructure required for this dubya stoopid big Australia by default policy.

 

[sydboy007]

Before 2007 a temporary levy was not a tax nor was it temporary
In the years 2007-2013 a temporary levy was just another great big tax
Post September 2013 a levy is but a temporary measure and certainly not a tax

A levy on high earners before 2007 was an illusion
A levy on high earners from 2007-2013 was class warfare
A levy on high earners from Sept 2013 is everyone doing their bit for Australia

 

[McLovin]

The problem is that spending on non GST goods and services is rising faster than GDP, so to leave it out means the current GCT base is part of a diminishing share of the economy.

I can sort of understand exempting food, or maybe we need to follow the UK and have a couple of rates for GST with the "essentials" at 10% and the rest at a higher rate.

Is it really food though or healthcare? If it's healthcare then a good place to start might be shifting more people into private health care, not through the carrot approach of paying for it but by saying if you earn over $x/year then you need to have private health insurance. The Medicare levy is far too low, especially now that it has been saddled with the burden of the NDIS.

I really don't like all these piecemeal changes that gutless governments have taken to. If reports are correct, it looks like I will be on a marginal rate of 50% thanks to Tony.

I never got my $900 either.

 

[sydboy007]

Is it really food though or healthcare? If it's healthcare then a good place to start might be shifting more people into private health care, not through the carrot approach of paying for it but by saying if you earn over $x/year then you need to have private health insurance. The Medicare levy is far too low, especially now that it has been saddled with the burden of the NDIS.

I really don't like all these piecemeal changes that gutless governments have taken to. If reports are correct, it looks like I will be on a marginal rate of 50% thanks to Tony.

I never got my $900 either.

I'm not sold on private healthcare. The US experience shows it can provide poorer services at higher cost than the public system.

Personally I'd prefer to see more imput from nurses taken on board as to how to drive efficiency gain, along with better use of technology. Certainly could look to some of the best practices from the private sector in India and US. Private healthcare in Australia is more about queue jumping that relieving demand in the public sector.

yes, political ticker is in short supply these days.

His spiel about not breaking his pre election promise is just painful. I have more respect for someone who says I made a mistake, and this is what I'm going to do to make it right, than the person who spends all their effort trying defend the indefensible.

Meaningful tax reform rather than the crapola band aids we've had for years is what we need.

 

[sptrawler]

I'm not sold on private healthcare. The US experience shows it can provide poorer services at higher cost than the public system.

Personally I'd prefer to see more imput from nurses taken on board as to how to drive efficiency gain, along with better use of technology. Certainly could look to some of the best practices from the private sector in India and US. Private healthcare in Australia is more about queue jumping that relieving demand in the public sector.

yes, political ticker is in short supply these days.

His spiel about not breaking his pre election promise is just painful. I have more respect for someone who says I made a mistake, and this is what I'm going to do to make it right, than the person who spends all their effort trying defend the indefensible.

Meaningful tax reform rather than the crapola band aids we've had for years is what we need.

Yes the Fairfax media are beating it up, as usual.
Any effort to fix the deficit, will obviously be met by Fairfax anti Abbott press. Seems a shame they don't appear to put Australia first.IMO

 

[banco]

Yes the Fairfax media are beating it up, as usual.
Any effort to fix the deficit, will obviously be met by Fairfax anti Abbott press. Seems a shame they don't appear to put Australia first.IMO

So if they don't agree with your/abbott's policy views they are not putting Australia first?

 

[noco]

Tony Abbott has relented on some of his PPL scheme under pressure no doubt from within his own party and perhaps from some of the independents.

It has now been capped at $50,000.

Under the current economic circumstances, I would have preferred the whole scheme be abandoned altogether.

But at least it will stop Bill Shorten raving on as though every woman having a baby was to have received $75,000.



http://www.theaustralian.com.au/nat...cutoff-to-100000/story-fn59niix-1226900259004

 

[SirRumpole]

Tony Abbott has relented on some of his PPL scheme under pressure no doubt from within his own party and perhaps from some of the independents.

It has now been capped at $50,000.

Under the current economic circumstances, I would have preferred the whole scheme be abandoned altogether.

But at least it will stop Bill Shorten raving on as though every woman having a baby was to have received $75,000.



http://www.theaustralian.com.au/nat...cutoff-to-100000/story-fn59niix-1226900259004

The PPL was Abbott's 'signature policy'. It may have won him the election. If he's now going to back down and break his promise on this then if he had any decency he would resign as PM.

 

[wayneL]

The PPL was Abbott's 'signature policy'. It may have won him the election. If he's now going to back down and break his promise on this then if he had any decency he would resign as PM.

We would run out of Prime Ministers very quickly.

 

[dutchie]

The PPL was Abbott's 'signature policy'. It may have won him the election. If he's now going to back down and break his promise on this then if he had any decency he would resign as PM.

Actually I think he would have won with a bigger margin if he had not taken it to the election.

He will get more kudos than criticism if he drops it all together irrespective of the "broken promise" factor.

 

[SirRumpole]

Actually I think he would have won with a bigger margin if he had not taken it to the election.

He will get more kudos than criticism if he drops it all together irrespective of the "broken promise" factor.

He'll get kudos from the business sector and some in his own party, but whether the electorate will forgive him is another matter.

They didn't forgive Gillard for the carbon tax.

 

[Junior]

The 'deficit levy' is a disgrace. If you're going to impose a significant increase in income taxes at least give more than a couple of months warning, and proper justification for it. Our deficit and government debt levels are low by international standards, if it's so concerning scrap the Parental Leave scheme, don't spend $12 billion on planes and tighten up Age Pension asset test and indexing. Income tax is already growing every year via bracket creep.

It's short term wealth transfer from middle/upper class workers to middle/upper class who choose to give birth, and can probably afford it without government assistance. Ridiculous and unnecessary from a Government who rattled on about 'not getting in the way of growth' and no new taxes or increase in taxes.

Most of my friends are around 30 years and earning 70-110k. Most have a significant HECS debt. This means you lose 7-8% of gross salary to HECS repayments, potentially 1% to Deficit levy and 23-30% in regular income tax.

It's a bit much!!

 

[Calliope]

He'll get kudos from the business sector and some in his own party, but whether the electorate will forgive him is another matter.

Nonsense. The electorate" hates the PPL. They would say "good riddance" if he dropped it all together. Direct Action on climate change is another stupid policy promise he should drop. Anothe stupid promise he should break is not to cut the ABC.

They didn't forgive Gillard for the carbon tax

But Shorten and the Greens love it. So I can only assume that they think the electorate loves it. Or are they just crazy?

 

[SirRumpole]

Nonsense. The electorate" hates the PPL. They would say "good riddance" if he dropped it all together.

What's your basis for saying that ? Never get between a voter and a bucket of money.

 

[drsmith]

The 'deficit levy' is a disgrace. If you're going to impose a significant increase in income taxes at least give more than a couple of months warning, and proper justification for it. Our deficit and government debt levels are low by international standards, if it's so concerning scrap the Parental Leave scheme, don't spend $12 billion on planes and tighten up Age Pension asset test and indexing. Income tax is already growing every year via bracket creep.

It's short term wealth transfer from middle/upper class workers to middle/upper class who choose to give birth, and can probably afford it without government assistance. Ridiculous and unnecessary from a Government who rattled on about 'not getting in the way of growth' and no new taxes or increase in taxes.

Most of my friends are around 30 years and earning 70-110k. Most have a significant HECS debt. This means you lose 7-8% of gross salary to HECS repayments, potentially 1% to Deficit levy and 23-30% in regular income tax.

It's a bit much!!

I agree that it's a disgrace but some of the numbers getting thrown around in the media are I would suggest nonsense. There's no way the government is going to slug someone who earns $80k an additional $800 tax (1%) at the point of reaching that income.

If they do introduce it, I would suggest it will be progressive. For example, an additional 1% on that part of income above $80k, rising to 2% on that part above $180k. Someone therefore on $80k wouldn't pay any extra, someone on $100k would pay $200 extra and so on.

The government has not only put a politically bad idea in the public domain but its marketing to the public by the same government has been even worse by not providing some firm numbers and thus allowing a level of media speculation that really scares the horses. The latest I see in the Fairfax press is this,

The Abbott government is likely to introduce the tax at a low level for incomes near $100,000, then gradually increase it with income to avoid a sudden step-up in tax. The tax will likely stop climbing when it hits 2 per cent.

That could mean a range of things.

This so-called deficit tax idea has become a political disaster for this government, both in terms of policy principal and its marketing and for Tony Abbott in particular. Even if they ultimately back away from it, the stench of deceit will remain and that at a time when Tony Abbott as PM needs to build his credibility, not destroy it.

The Medicare levy is already going to increase by 0.5% in July so even the timing is terrible.

My local Liberal member is about to get an email.

Idiots.

http://www.smh.com.au/federal-polit...rs-hardest-hit-in-new-tax-20140429-zr1el.html

 

[McLovin]

He will get more kudos than criticism if he drops it all together irrespective of the "broken promise" factor.

Of course he'll still have that messy broken promise about no new taxes. Seriously, it just completely baffles me how someone can be so dumb as to run a campaign for three years about a broken promise of not introducing a new tax and promising not to do the same and then introducing one at your first budget. It's schoolboy stuff.

Tony's biggest problem seems to be that he thinks his landslide was due to his popularity and trust in the electorate.

 

[Calliope]

What's your basis for saying that ? Never get between a voter and a bucket of money.

Ponder this;

Should Tony Abbott ditch his paid parental leave scheme?


No. Parental leave should be paid at a person's full wage. 5%


Yes. The country can't afford it. 55%


No. We need to help parents in the workforce as much as we can. 0%


Yes. The current parental leave scheme is adequate. 38%

This is only a small regional poll, but even you should get the drift.

http://www.gladstoneobserver.com.au/news/todays-poll-should-pm-ditch-paid-parental-leave-pl/2244108/

 

[chode84]

Ha Gladstone. Full of men. I don't think anyone even has kids in Gladstone any more. It looks like cancer central from above.

 

[sydboy007]

Nonsense. The electorate" hates the PPL. They would say "good riddance" if he dropped it all together. Direct Action on climate change is another stupid policy promise he should drop.

Still leaves him with an open wound till the next election for another broken promise. Abbott ranted about Gillards' integrity. It was all black and white, so he'll most likely be judged in a similar vein.

I think Abbott is having a very difficult time adjusting to being in Government and responsible for policy, than being in opposition and able to just whinge about things without offering much constructive policy.

To me the defining point will be how much of the CoA is sidelined. From the sounds of it they will throw it in the circular filling cabinet next to their desk much like Labor did with the Henry Tax Review.