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The state of the economy at the street level

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Value Collector said:
its also not necessary, because as the mining companies earn more they pay more company tax anyway.
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We all know that means exist to avoid paying company tax.

The excuse for a gst was to minimise tax avoidance.

A good case could be made for partially replacing profits tax on mining income with an export tax.
 
SirRumpole said:
Have you seen the National debt lately ?
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That is not because we aren’t charging enough on mining, that’s because we have been spending to much.

But also I don’t think there is anything wrong holding some national debt, think of all the infrastructure that will be inherited by the next generation that was built by the prior generations, why should they get that for free?

At the end of the day I don’t think this generation should over tax themselves and limit the building of infrastructure just to make sure the next generation inherits the country with no debt.

think of the Sydney harbour bridge for example, it improves the lives of many people in Sydney to this day, I don’t think the cost of it should have been paid by just the people that built it, the fact that the baby boomers had to pay of the debt on it was fine, even though it was the generation before that paid for it.

think of it like a child inheriting the family farm that’s worth $1 million, but it comes with $200k debt. I think the parents would be stupid to rip themselves off and limit them selves just to clear that last $200k for their spoilt brat.
 
SirRumpole said:
We all know that means exist to avoid paying company tax.

The excuse for a gst was to minimise tax avoidance.

A good case could be made for partially replacing profits tax on mining income with an export tax.
Click to expand...
Mining companies are some of the largest tax payers in Australia.

why not increase gst to 25% then?

what you are suggesting is basically put a tariff on ourselves, and knee cap our own productivity, and giving an advantage to our competitors
 
Value Collector said:
Mining companies are some of the largest tax payers in Australia.
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How much of that goes to overseas shareholders therefore contributing nothing to our economy ?

If there is an export tax on minerals/gas the companies just put their prices up to overseas customers so the reduction to their revenue could be as small as they want it to be.
 
Working for Rio a few years back my supernintendo told me we were putting a tonne of iron ore on the ship for $15/T at the time it was $150/T so there would be a little wriggle room I would think.
 
The taxes are paid here before dividends are paid.

Not only that, Australian mining companies profit from mines they own all over the world, so the Australian government earns company tax on mines that aren’t even in Australia.

before we make to much noise about extra taxes on mines, perhaps we should consider the affect of that rational spreading to other countries where the Australian companies currently mine, because they might seek to nationalise more of their mining revenue.
 
Humid said:
Working for Rio a few years back my supernintendo told me we were putting a tonne of iron ore on the ship for $15/T at the time it was $150/T so there would be a little wriggle room I would think.
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That’s before Royalties, taxes and the cost of capital.

at $15/ tonne on the ship, he actual break even price would be about $30, and from there every $1 extra they can charge results in about $0.50 cents in profit once you factor in the additional royalties, discounts and company tax that accrue against that additional dollar.

what people have to realise is that mining is a cyclical business, prices fluctuate, it was only a few years ago that BHP, RIO and Fortescue were earning just a couple of dollars per tonne, and most of their smaller competitors went bust.

yes there will be good years, it we need them to make holding in through the bad years worth while.

mover time the profit will average out to a fair return on capital invested and risk taken, the market takes care of itself, if the return on capital gets to high for to long, competition will bring that return down again.
 
on a street level if they're not whinging they're getting a good deal
 
Value Collector said:
At the end of the day I don’t think this generation should over tax themselves and limit the building of infrastructure just to make sure the next generation inherits the country with no debt.
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The Intergenerational Report indicates there is pretty much zero chance of that happening.
 
Value Collector said:
think of the Sydney harbour bridge for example, it improves the lives of many people in Sydney to this day
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To the extent any one generation leaves a legacy for the next, I'd argue it basically comes down to things that were invented and major engineering projects that were built.

Roads, bridges, railways, dams, hydro power stations, pipelines and so on are as close to permanent as it gets so far as practical things built by humans are concerned. Everything else tends to be either ornamental or short term.

If you consider all things pre-WW2 that are of any relevance today then it's basically a list of inventions and big engineering projects. Pretty much all politics, creative arts etc is long forgotten.
 
Think of what Sydney harbour (and the rest of Australia) looked like when the first fleet sailed in, compared to today.

All the infrastructure that exists today, minus the debt is profit to be inherited by the next generation.

——————-
Also, by the time you actually hit the age of 18 (or 25) and start paying taxes, you have already consumed a lot of government resources eg education, health care etc that have raised your quality of life from what your equals in third world nations would have.

So it’s a bit rich to expect to arrive at that stage and not have any debt to pay.
 
Value Collector said:
Think of what Sydney harbour (and the rest of Australia) looked like when the first fleet sailed in, compared to today.

All the infrastructure that exists today, minus the debt is profit to be inherited by the next generation.
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Indeed and I'll go a step further and say it has has far more value than most "economic stimulus measures" which typically produce nothing more than a short term sugar hit.

Infrastructure brings lasting benefit and enables further wealth creation so it's a logical focus.

As for the money borrowed to build it, well the only people I've ever heard raise objection were those who opposed the infrastructure being built as such. That is, debt was just a convenient argument to use against something they opposed for some other reason.
 
When resources first started to be exploited in the 1960's, a caveat on there removal was that towns were built near the resources, to build infrastucture in outback Australia.
The other caveat placed on the mining companies was to value add in Australia, which is how the AIS blast furnace and the Whyalla, Port Kembla and Newcastle Steel industries were started.
Now the World has changed but the royalties system hasn't changed, the value adding has been removed, but the royalties have remained generally unchanged.
I can understand those who have skin in the game , understanding the logics, most taxpayers probably are somewhat more sceptical.
The value adding has in most cases gone, the country towns have been replaced by FIFO and the resource removal rate has increased ad infinitum.
How this benefits Australia in the long term, is questionable at best, raping the country at worst IMO.
As @SirRumpole says, there should be volumetric tax based on a benchmark index, to reflect the competitive advantage Australia has, with extraction and shipping costs. Eventually we run out of resources that are cheap to extract, then the piper gets paid, that is what will put our grandkids in poverty.
Which actually probably doesn't bother those who don't have kids or grandkids one iota, as long as the dividends keep rolling in.
Again just my opinion and I did grow up in mining towns.
 
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But in these days the debt is not due to building infrastructure, it's because of handouts to businesses and individuals to simply keep on living or keeping restaurant doors open.

Nothing extra is being built that wasn't planned already because governments simply can't afford it.

This debt has to be paid off, and income from infrastructure won't do it.
 
1. Actually lots of stuff is being built, snowy scheme, highways etc but Sometimes **** happens, and you have to press pause on infrastructure etc and go into debt to fight a war, this time it’s a war against a virus. We will survive, things will return to normal, and we won’t be devastated by bomb blasts.

2. yes debt does have to be paid off eventually, and it does get paid off, it’s just we keep adding new things along the way, just like some families always have car loans and credit card debt.

As I said it is not really fair for one generation to take a big cut in quality of life just to over tax themselves so that they can hand the world debt free to the next generation.

sometimes debt makes sense, I mean imagine a 70 year old that owns a $1 Million house, if they take out a $200K loan against the house and install a pool, by a new car, live a little better and holiday, so what.

the fact that they may die in 10 years and leave part of the 30 year loan to their kids is offset by the fact the kids get the $1Million house, that now has a pool, plus they enjoyed a few summers with happy family round the pool in the mean time.
 
This is also at a time when the demographic inversion (baby bust) chicken comes home to roost and all the tax revenue of the boomers in their final years of their working lives vanishes whilst they all start becoming drains on the system through healthcare and so on.

Remember, there's not just the debt itself, there's the question of how easy (or not) it is to pay off.

Gen X is significantly smaller than the boomers and taxes can only be raised so much. They were already going to have to raise them to pay for the boomers in retirement, but when you combine that with paying the debt off too, you have a catastrophe.
 
boofhead said:
BHP and Rio do their sales through Singapore to reduce their taxation here
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I believe they have been caught on that, but basically sell to your commodity desk in SGT at cost, which resell with profit to your customers.
Glencore was even going further and claiming tax refund on losses.
the solution is easy: tax not on profit or anything like that with is just very subjective/easy to fudge but on moved ore/soil;
This incites less ecological imprint, and favorise efficient m
Sadly except communism, religion extremisms...some ideas seem to stick like sxxt to people's mind, and relentlessly destroy people lives and brains until the situation is so bad that it get discarded,then pops its head again elsewhere.
 
It is pretty clear money has lost its value/meaning for our governments:
not restricted to Australia: QE USA , Japan,EU but going down already to states and council levels..(new local budgets now released)
So obviously the only possible result is same happening at the individuals level: increase bread price, hourly rate, etc...
Sxxt timing for retirement...
 
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