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Useless Labor Party

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bellenuit said:
Won't the wealthy just move all their assets in to Family Trusts or other such structure, leaving those with just moderate assets the main source of that tax.
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No they will get hold of Packer's money, from his 300 or 400 negative geared rentals. lol
 
* 'Reform' family trusts (presumably make it hard/impossible to use individuals with low tax rates as beneficiaries)
* No company tax cuts
* Reduce CGT Discount
* Income tax cuts only for those on less than around $80k income. Retain 'budget repair levy'. No indexation or increase in any of the tax thresholds, except for those on low income.
* Removal of negative gearing
* No franking credit refunds (except those on Age Pension)

Add up all of the above policies......MASSIVE increase in the tax burden for any Australian who is not on welfare or a low income earner. This will smash the domestic economy at a time where it is already fragile....banks are already hiking rates out of cycle and the property boom has peaked. NOT the time to hit business owners and those Australians who pay the lion's share of taxes and provide jobs, with additional taxes.
 
Junior said:
Add up all of the above policies......MASSIVE increase in the tax burden for any Australian who is not on welfare or a low income earner.
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If you want to raise revenue you have to look where the money is, not where isn't.

People who haven't seen wage rises for years while company profits and executive salaries are soaring are rightly asking when are they going to get some relief.
 
SirRumpole said:
If you want to raise revenue you have to look where the money is, not where isn't.

People who haven't seen wage rises for years while company profits and executive salaries are soaring are rightly asking when are they going to get some relief.
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The problem is, all Labor are suggesting is moving the chairs around, it isn't addressing the long term problem with our tax system.
Someone really needs to have a honest look at the Henry report, and all the other reports.
The welfare system is getting more and more expensive, and the tax base getting smaller and smaller, it will end up in tears by constantly applying band aids.
All that will happen, is everyone will end up on the public purse, then how do you pay for it?
 
sptrawler said:
Someone really needs to have a honest look at the Henry report, and all the other reports.
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I absolutely agree with that, and Labor is to blame for letting it gather dust, although the Libs could obviously have taken it on board as well.
 
sptrawler said:
The welfare system is getting more and more expensive, and the tax base getting smaller and smaller, it will end up in tears by constantly applying band aids.
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The tax base is getting smaller because of schemes like neg gearing and super tax discounts which favour the highly paid. Get rid of those schemes and you could reduce marginal tax rates.
 
SirRumpole said:
If you want to raise revenue you have to look where the money is, not where isn't.

People who haven't seen wage rises for years while company profits and executive salaries are soaring are rightly asking when are they going to get some relief.
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I hear what you're saying, but a couple of points:
  • Tax revenue is booming due to massive population growth, growing company profits and bracket creep.....I really don't think the Govn't is short of revenue. There should be enough in the pot to provide relief across all income levels over time.
  • The top 10% are already shouldering a significant burden in terms of tax. If you look at average tax rates we are right up there in comparison with OECD average. No doubt most aussies are OK with this and it's the way the system works, but any attempt to load the top 10% with a bigger and bigger burden will have a number of negative consequences and inevitably will backfire IMO. This can result in reducted ability to generate employment and more incentive to hide income/profits or relocate operations to a jurisdiction with low tax rates.
  • Big tax hikes would potentially be OK if you could trust Labor to use the surplus to smash down Govn't debt, but we all know the deficit won't be going anywhere, as the temptation will be there to buy votes and will find ways to spend any additional revenue raised.
  • Big tax hikes will only result in Big Government, more inefficiency, overpaid public servants and a bloated welfare system.
 
SirRumpole said:
The tax base is getting smaller because of schemes like neg gearing and super tax discounts which favour the highly paid. Get rid of those schemes and you could reduce marginal tax rates.
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I agree on negative gearing and this should be wound back OVER TIME with grandfathering for existing arrangements....property prices are already looking shaky and trying to kill Neg Gearing too suddenly could accentuate price falls.

Super tax discounts have already been unwound substantially. Need to give self-funded retirees a break and a chance to digest the changes already in place.
 
SirRumpole said:
The tax base is getting smaller because of schemes like neg gearing and super tax discounts which favour the highly paid. Get rid of those schemes and you could reduce marginal tax rates.
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the irony here is that if you gave massive cuts to marginal rates then all those offset mechanisms become way less attractive to do (as in you might as well take the taxed money rather than take an actual loss so you can claim a tax deduction).........
 
SirRumpole said:
The tax base is getting smaller because of schemes like neg gearing and super tax discounts which favour the highly paid. Get rid of those schemes and you could reduce marginal tax rates.
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The problem with those two examples, are they both only affect middle income earners.

High income earners aren't into negative gearing and renting properties, or overly exposed to superannuation. They have McMansions overlooking the river, and receive bonus shares as part of their salary package.

IMO, this is Labors real problem, the ones they are going to hit, are their voter base.

Obviously the ACTU has woken up to this, and are going to push for death duties, rather than hitting tradies, construction workers and most other middle income earners.
Who negative gear, buy shares in their wife's name and hope their super will give them a good retirement. :xyxthumbs

I think Silly Billy has shot himself in the foot, big time, talk about being out of touch with your voter base. :roflmao:
This is why his leadership has gone all wobbly, the CFMEU are worried, they will be hit. :D
 
This highlights Billy's problem, it is an extract from an article on negative gearing, by pay scales.

The data also allows us to break down negative gearers by income tax brackets.

In 2014-15, 40.1% of individuals earned less than $37,000, they accounted for 24% of all people negative gearing, but only 19% of the total amount of taxable income loss.

By contrast, those earning between $80,000 and $180,000 accounted for 19% of individuals but 32% of negative gearers, and 34% of the amount of rental loss.

But the big disparity is for those earning over $180,000. Only 3.4% of individuals earned that much but they accounted for 8% of all negative gearers and 15% of the total rental loss amount:


The high income earners, heavy into negative gearing, apparently are surgeons and anaesthetists.
It appears that the actual percentage of people negative gearing, flattens off, after $180,000.
I can understand that, if you had tons of money, it is easier to have shares than tenants. Then just keep upsizing the McMansion and the view.

https://www.theguardian.com/busines...t-negative-gearing-benefits-the-rich-the-most

 
SirRumpole said:
The tax base is getting smaller because of schemes like neg gearing and super tax discounts which favour the highly paid. Get rid of those schemes and you could reduce marginal tax rates.
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Yep, agreed. It's true it affects middle income earners. And that's because schemes like neg gearing cause the highly paid to become middle income earners in the first place. That's why they do it. But I think it should be abolished regardless of who it affects because it merely adds to our welfare state bill and that's how Labor should be running it. We simply can't afford to pay for it.
 
Question: If peeps want to abolish interest deductions on the income generating borrowings of individuals, then do you also disallow the interest deductions on the borrowings that a company/business does?
 
HelloU said:
Question: If peeps want to abolish interest deductions on the income generating borrowings of individuals, then do you also disallow the interest deductions on the borrowings that a company/business does?
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Not me. I have no problem paying tax to support employment.
 
@PZ99
not sure if you mean that interest on company borrowings should not be allowed as a business expense.......my point is that neg gear for an individual is, to me, the same as deductable business interest........
 
HelloU said:
@PZ99
not sure if you mean that interest on company borrowings should not be allowed as a business expense.......my point is that neg gear for an individual is, to me, the same as deductable business interest........
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The difference for me is I see a return from my taxes sponsoring business interest deductions.

I see no benefit from my taxes supporting a bloated housing market for individuals.
 
ok - I think I am reading that correctly as happy for a trust/company/business to get a tax deduction, but not an individual (for interest on borrowings)

I think if a company/business/trust is able to hold income producing real estate and claim a tax deduction on interest payments then I see it as fair that an individual can hold income producing real estate and claim a tax deduction on interest payments as well.
 
I see it as fair that an individual can hold income producing real estate and claim a tax deduction on interest payments as well.
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It would be fair if the deductions were only against the income from that asset.

It's not the other taxpayers job to subsidise loss making investments.
 
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