Thinking again about the Summit and talk of changes to the current taxation system made me wonder if OLO contributors had any ideas that might improve our current system of taxation. Our own mini-Summit on taxation.

I am no expert on this but thought that a fairer taxation system might also be developed to assist with goals of sustainability. That is, those who consume more pay more.

At the moment the highest income earners and corporations can still legitimately avoid tax to some extent via tax havens and investments while middle Australia carries the greatest burden.

Would it work to increase the rate of GST on luxury items (not essentials of course) to about 15% and reduce the personal income tax rate for those earning under $100K. This might also assist in easing the pressure on current high costs of living and go someway towards alleviating the debt crisis. I would also recommend abolition of the fuel excise to reduce petrol prices.

Those who consume the most would pay more tax via the GST. It would only work if there was no exemption for corporate purchases like the company yacht so that those who normally avoid tax would not be excluded.

Some possible problems might be: would petrol prices reduce if tax was removed or would there be a risk that petrol companies would take advantage? Would increasing real income mean inflation goes up and with it interest rates? I would hope that increasing GST on non-essential/luxury items might reduce spending but I may be wrong.

I have not got my head fully around this but as a concept do you think it might work? What might be some problems that I have not thought of?

And any other ideas to make taxation fairer?

pelican the purpose of tax is to finance the necessary work of government.

So what is the role of government: to provide for the military defence of the nation and the infrastructural niceties required to enact legislation, pay the law makers and judges, and pay for other regulators.

The debate is still on about how far a government should be involved in housing, health and education, thus how much tax should be raised and how much of those discretionary services should be funded direct by the user.

In none of that do I see any motivation for the tax system to be “fair” or “fairer”.

Tax is not a system suitable for the re-distribution of wealth. If it were communism would have worked and it obviously never has.

The pretend role of socialist government, to cosset everyone from cradle to grave, has been proven not to work and to be as big a lie and a fraud as the communists. Nationalization of segments of economic activity never benefited any but a few of the favoured.

So for me, the best tax system is the simplest system, funding the necessary work of small government instead of the pandering excesses of big government.

In absolute terms, the simplest is a pole tax, everyone pays so much for the privilege of being here.

I can see the obvious disadvantages of using just a pole tax, so do not suggest it as am absolute solution.

"Would it work to increase the rate of GST on luxury items (not essentials of course) to about 15% and reduce the personal income tax rate for those earning under $100K. "

That would only complicate things and thus, I am against it from a simplicity point of view
Plus my ethical view, you should not use differential taxes to redistribute the pain of taxation unevenly across society.

I believe we should consider:

Get rid of FBT. Its is complex relative to the revenue it generates.
Get rid of land taxes, as was supposed to happen with the intro of GST
Get rid of excises.

To “help” the less able, increase personal tax thresholds.
Keep income tax but match company tax and personal tax rates to a one common rate.

On the saving side of government (which all those taxes are used for)

Retrench all the “planners” who pretend to administer for the benefit of the tax payer and remove government from much of its meddling, returning it to a regulatory authority, instead of a commercially participative entity.

Stop all government loans and grants to business.
Reduce the size of the ATO and other bureaucracies to suit their reduced role.

Retain CGT, it helps, as we do not have death duties (crystalisation effect).
Retain dividend imputation.
Consider a death duty / inheritance tax.

That is not a definitive list but just a suggestion of where and what to start with.

I think you raise a point which is a very important opportunity for making everyone’s life easier and the government of the country more transparent and possibly even more effective

Thanks Col you raise some good points - it might be better to raise the personal tax thresholds (rather than increase GST on luxury items) to provide relief for lower income earners. The GST was marketed as being the tax to end all other taxes but this did not happen and there is an amazing array of hidden State and Commonwealth taxes.

I had read something about this the other day and it got me thinking about the fairness aspect but as you rightly say the motivation is not fairness but how to accumulate the funds to pay for necessary infrastructure and services.

It made me wonder if there was someway to evenly distribute the burden particularly at the top end where legitimate tax evasion is possible. Corporate welfare costs the taxpayer millions each year whether it be via taxation incentives or other devices.

The Australian taxation system is certainly complex and overly bureacratic and logic suggests that there must be a better way.

Taxation was not one of the big ticket items at the Summit and I have not read about it in much detail (could not find anything much on the www.2020Australia.gov.au website on this issue).

Dear pelican,

The following website may be of interest to you and other
posters:

http://petermartin.blogspot.com/2008/04/tuesday-column-budget-night-when-will.html

Pelican “where legitimate tax evasion is possible.”

I will correct you on this point:

“Legitimate tax evasion” is an oxymoron, if it is “evasion” it cannot be “legitimate”.

I think you mean “avoidance”.

The best justification which supports people who seek to take all measures possible to avoid paying tax was stated my Lord Denning in UK who observed (paraphrase), tax is an imposition and a person is at liberty to take all the means legally possible to avoid any imposition.

Denning is basically saying we have a civic duty to pay tax but to pay no more tax than we are legally obliged to. I humbly agree with him.

“Taxation was not one of the big ticket items at the Summit and I have not read about it in much detail”

I was fortunately away on a pacific cruise when it all happened and probably did myself more good by quafting large amounts of food and alcohol than developing angst over Krudds waste of money talk fest.

That “tax” was not on the agenda does not surprise me despite its significance when it is the enabling facility for Krudd to fund all his other agenda items.
I figure, reading the Australia 2020 summit topics, the main thrust was a parade of airy-fairy, cotton–candy feel good notions around ethereal life qualities and things people only identify with in a most remote manner, rather than the nuts and bolts of everyday living and paying tax is one of them nuts and bolts which holds the nation together.

The Australian governments excise around 31.5% of GDP from the wage packets and incomes of real people.

I would suggest “tax” is about as efficient a means of economic management as a power station is at converting the energy potential of coal into electricity (around 30-35% on a good day).

I am happy to challenge any politician to justify the exhorbitant level of taxes we are shackled with, relative to the "Real" services which are delivered.

Col Rouge claimed:

"In absolute terms, the simplest is a pole (sic) tax, everyone pays so much for the privilege of being here."

It was a POLL tax, Col and was the most unfair form of tax where low income paid the same flat rate as the wealthy. Resulting in riots throughout Britian, it also brought about the downfall of the Thatcher government.

I think Col has been quaffing too much of the vino and watching too much POLE dancing and become a little confused.

I take any snide insults from the foetid fingers of Col as acknowledgement that my post is most accurate and that Col's ruminations on tax are to be treated with all the gravitas of a waitress at Hooters.

"In absolute terms, the simplest is a pole tax, everyone pays so much for the privilege of being here. "

Col I've floated the idea previously of an income tax system based on time rather than dollars (no answers yet for investment type income).

The one thing we all get the same amount of (on a day by day basis not over a lifetime) is time. The current system places less social responsibility on those who choose to use their time for non income producing pursuits than those who spend more time trying to earn income. Hardly fair.

I've suggested that our responsibility be based on a certain number of hours (with the option for the finacially hard up of the debt being paid by through specified community service rather than cash).

My tax responsibility would be based on so many hours at my average hours income. Someone who chose to work fewer hours at the same hourly rate would not somehow become less responsible for their share of the cost of keeping government functional nor would someone who worked extra hours incure a greater responsibility.

Not perfect and it does not cover some forms of income but far fairer than a system that places greater responsibility on those who work longer hours and less on those who work less.

R0bert

Hi Robert, whilst I understand your value of time, basically we all have 25,000 days (or so) to experience. How would it be if I were to employ someone, with the excess of my income to serve my “time”?

It makes paying tax as savoury as a gaol term - worse, criminals did something wrong to deserve the time they serve and tax payers are generally law abiding. :-)

Using “time” would reverse our fairly sophisticated economic system back to a barter process. The “quality” of the product of that time is indeterminable. Whilst I would assume your time to reflect your attitude and values of honesty in your posts, I would suggest not all would be so honourable in their commitment or their effective time contribution.

“Not perfect and it does not cover some forms of income but far fairer than a system that places greater responsibility on those who work longer hours and less on those who work less.”

There is no “perfect” solution and no “fair” solution.

Tristan Ewing’s on one of his leftie economic platitude articles, comments to paying additional taxes to ensure some supposed worthy social service be either maintained or expanded.

I believe the solution to “fairer” taxes is to minimise the need for them.

Smaller government, not larger government. People being allowed to be responsible for their own destiny and not taxed into servitude to support “large” government’s idea of destiny.

Ultimately, the excess income left in peoples pockets will enable them to afford both the necessaries and luxuries, avoiding the cost of the bureaucracy of governments (we have enough of them in Australia).

Too many of our sovereign choices are subordinate to government regulation. Government planners, who decided on green wedges around Melbourne and caused the current land price crisis in housing.

Government bureaucrats, paid to employ government planners, paid to employ consultants to come up with master plans which are ignored or abandoned on the whim of a politician faced with a tough election.

Lots of waste and no accountability in government. The private system has, at least better accountability.

Foxy thanks - some good suggestions in the list of ideas.

Col
Yes I definitely meant 'avoidance' (whoops!).

I would argue for wiser government (rather than small). The needs of the 'collective' are often addressed better by government than by private enterprise (not everything I grant you).

It makes sense that if we need health care or fire and police services, we contribute via taxes. In effect, a form of insurance and would come a lot cheaper for the individual than if it were in private hands eg. America's health system. (I agree that there is also a lot of nonsense paid for by taxes)

It was ludicrous when schools started talking about sponsorship by private companies like McDonalds to increase their funding.

Reminds me of the case in America where a student refused to wear his 'Coke' T-shirt on Coke day and wore 'Pepsi' instead and was suspended for a day. The best link I could find was: http://www.ibiblio.org/commercialfree/presscenter/art_32698.html

Col:"I am happy to challenge any politician to justify the exhorbitant level of taxes we are shackled with, relative to the "Real" services which are delivered."

Yes, this is the crux! We are forever being taxed more for less and less services by government. Governments don't do well when they start believing they are businesses and forget they are 'funded' by the taxpayer in the first place.

The current surplus was bandied about as a great achievement by our last government while we all watched as health and other critical services went down the gurgler.

There are many government services particularly in the areas of the arts and sport which would be better met by the private sector. Many government programs are just blatantly political (image rather than substance) and usually with little accountability or monitoring processes. As per Foxy's link which suggested self funding for art and sport (millions of tax dollars are spent on sport - and I don't mean small time football teams or local community sports but the big leagues).

It is a complex problem.

I send an other text about Australia and it disappeared or I published it on an other thread! I do not know what happened with it.
Now simple I give some information from USA and some thoughts from The Guardian newspaper.
How to earn $3.5 trillion and pay zero taxes
The GAO study found that 71 percent of foreign-controlled corporations operating in the United States paid no taxes in those five years; nor did 61 percent of US-controlled companies.As a percentage of all federal tax revenues, corporate tax payments have declined from 23 percent in 1960 to 13 percent in 1980 and 8 percent today.The top 400 U.S. taxpayers, with an average income of $151 million, paid 27 percent in total taxes in the year 2000. All other taxpayers, with an average income of $34,600, paid 40 percent in total taxes.A study by Citizens for Tax Justice notes that over the ten-year period from 2001 to 2010 the richest one percent of Americans are scheduled to receive tax cuts averaging $34,000 per year. For the 20 percent of families with the lowest incomes, the average tax cut will be $77.Government and independent sources confirm that an elite group of about 13,500 Americans have more income than the 96,000,000 poorest Americans

For a better taxation system (from The Guardian newspaper.)

Increases the tax rate for high income earners and big corporations and lowers it for those on low and middle incomes;

Cracks down on family trusts which are used by the rich to avoid paying taxes;

Raises the tax-free threshold for those on a low income;

Ends tax avoidance schemes which are used by big corporations to avoid
paying their share of taxes;

Adequately funds the Tax Office to tackle tax avoidance;

Maintains the capital gains and fringe benefits taxes;

Eliminates government handouts to companies such as direct grants and tax concessions.
Antonios Symeonakis
Adelaide

If paying INCOME-TAX is a VOLUNTARY obligation what is the problem with all who have posted on this issue ?

If the TAX COMMISSIONER can only attempt to get VOLUNTARY COMPLIANCE why is this discussion taking place ?

Doesn't anybody understand the meaning of the word VOLUNTARY ?

The problem is that you have all volunteered and agreed to lodge a TAX RETURN and further agreed that you would declare, by way of a declaration that you personally sign, what your income was for the twelve months prior to VOLUNTEERING this private and personal information to the TAX COMMISSIONER along with your TAX FILE NUMBER so that he can identify you.

Why do you think that there are hundreds of judges and lawyers who do not pay this impost and the TAX COMMISSIONER can't do a single thing about it ?

If the TAX COMMISSIONER stores or maintains a record of your TFN or passes this private and personal information, TAX FILE NUMBER, on to third parties or allows access to the TAX COMMISSIONER'S data base without your CONSENT or, after you have expressly revoked your CONSENT in a manner contrary to section 8WB of the Taxation Administration Act 1953, he is liable to be prosecuted for a crime. That is why Carmody left.

This very issue is now before the Federal Court of Australia in Sydney as the Child Support Registrar seems to believe that they have unfetted access to the Tax Commissioner's data base without their clients consent, noncustodial parents, even though the Registrar is to get permission by way of a written statement under section 16B of the Child Support (Registration & Collection) Act 1988.

Why do you think the discussion Mr Rudd is having about the tax system is now taking place ?

For those interested in the details of the preliminary hearings in the Federal Court of Aust go to their web site. There is more to this matter than meets the eye and they know it.
Government and taxation is an illusion and they have plenty of money they dont need ours.
http://esearch.fedcourt.gov.au:80/Esearch?p=further_details&det=coa_order&mat_id=3536550

Young Dan, thanks for that info. I wasn't sure of the status of that matter. The implications for the CSA are quite serious if the applicant's case is upheld. Mind you, if it is, the Govt will simply legislate to allow the CS Registrar automatic access, but at least then it will be an explicit power, not an illicit action by a corrupt Agency.

Antiseptic,
They can change what ever they like as they have done in the past ten years but it doesen matter, the offenses have already been committed and caused the harm, thousands of suicides and theft of property, now they are going to pay. Changing corrupt judges or providing pretend courts wont help either as they have done in the past.

ASyeonakis

I agree with your proposals – all good ideas and very fair.

And if there is one thing Australia needs it is some fairness injected into the system which is looking very regressive at the moment.

One extra suggestion if I may:

BAN Negative Gearing.

It is destructive of the social fabric, encouraging amateur investors to take on the role of DEBT LEMMINGS.

ENOUGH.

Let’s buy a big industrial shredder and dispose of this negative concept once and for all. Don't want to buy a shredder, no problem. There are plenty of flush toilets around.

Excellent one page article on negative gearing and the rort it is:
http://www.prosper.org.au/2007/11/01/negative-gearing-incompetence-or-conspiracy/

Also, for those interested in tracking the housing bubble (mainly result of negative gearing) you can check this:
http://www.thepropertypin.com/viewforum.php?f=11

Have a nice day

Fractelle “It was a POLL tax, Col and was the most unfair form of tax where low income paid the same flat rate as the wealthy.”

The poll tax was introduced to offset some of the council rating system.

Those who occupied their own homes had been paying house rates for local council services which those in commission houses (council houses in UK) did not, regardless of the significant income of many in commission housing, who were perfectly capable of buying a home had they had the attitude to do so.

In fact many ex council houses were sold to their occupiers at a discount to help them become owner-occupiers and millions benefited from that “Thatcher” government initiative, which the socialist swill never had the balls to deal with.

But you so obviously failed to read or include the rider which I also posted:

“I can see the obvious disadvantages of using just a pole tax, so do not suggest it as an absolute solution.”

How small minded of you.

As for “I take any snide insults from the foetid fingers of Col as acknowledgement that my post is most accurate and that Col's ruminations on tax are to be treated with all the gravitas of a waitress at Hooters.”

You can take whatever you want away with you from my posts.

Since you obviously have nothing of merit to add to the debate, I suggest you just read the views of others and learn that your personal take on the world is not omnipotent (actually more like impotent).

Mr Nobody “BAN Negative Gearing.”

I thought this might come up, almost suggested not banning it originally.

Your reason “It is destructive of the social fabric, encouraging amateur investors to take on the role of DEBT LEMMINGS.”

Simply sucks of the “nanny state” trying to protect people from themselves.

Banning NG would make the tax system more complex by applying differentials to tax laws based on mediums of investment and, likely, increase the rentals paid by tenants to cover the tax adjustment denied investors

Col

Not exactly well endowed with self irreverence are you?

You made a mistake, have a laugh and move on.

Remember it is POLL not POLE.

However, you may have been thinking of 'dearest' Maggie dancing just for you.

;-)

Pelican “I would argue for wiser government (rather than small).”

The two are not mutually exclusive.

However, if in doubt, put faith in smallness rather than wisdom, it is more readily observable.

Certainly a large incompetent government wreaks greater havoc than small incompetent government, 70 years of Russian communism being the classic case study.

As for funding of services, I always favour pluralist solutions over an exclusive government monopoly. It is simple, monopolies are evil, regardless of the ownership or the emotional rhetoric of the socialist minded. However, I also believe government has a role to play in developing and pursuing good governance, especially when cartel and monopoly opportunities present themselves (FTC re Microsoft) or a new fraud manifests itself (Sarbane-Oxley re Enron, for instance).

“Yes, this is the crux! We are forever being taxed more for less and less services by government.”

Pleased we agree :-)

“There are many government services particularly in the areas of the arts and sport which would be better met by the private sector.”

Exactly, we could discuss Jackson Pollacks “blue poles” ad-infinitum, end up always questioning if it was worth a brass razoo and still ask:

would our taxes have been better spent waxing the moustaches off all the ugly women in Australia?

ASymeonakis I think you need to consider the purpose behind your suggestions:

Define what is “low income” and what is “high income”.
Why treat companies different to individuals (which actually creates the tax loopholes)?
Why retain such an inefficient FBT system when the government operates with such high budget surpluses?

Fractelle “Not exactly well endowed with self irreverence are you?”

Being “endowed” to any degree with a negative is moronic.

But it is what we now expect from your posts.

If, however, you are suggesting I first “consider” what I write and in this instance believe my background might contribute to the debate, you would be absolutely right.

As for poll versus pole – yeah terrific, yawn.

(consider youself are dismissed)

Col

I agree with you the best tax system is the simplest system and should not pander to the excesses of big government, or big business or even big egos for that matter.

When you say “Simply sucks of the “nanny state” trying to protect people from themselves” –

Are you referring to the concept of banning NG and protecting DEBT LEMMINGS (amateur landlords) from themselves?

Or are you referring to the “nanny state” in terms of the billions of tax-payer dollars squandered on the tax-breaks-r-brigade?

Either way, I agree it is time to stamp out government largesse that panders to the wealthiest in the community.

With your obvious tax knowledge but what appears to be a limited understanding of what is fair, I wonder if you might benefit from the following link. It concerns the next generation and how they are being duded by NG.

http://firsthomeowner2008.googlepages.com/

Have a nice day

Pelican,we have enormous amounts of natural gas which we sell to China for a song,why not sell gas to the people who really own it for a reasonable price?

It is cheap energy which underpins our living standards.Get Govt and the multi-nationals out of the equation and ordinary Aussies will prosper.

Pelican,
“I am no expert on this but thought that a fairer taxation system might also be developed to assist with goals of sustainability. That is, those who consume more pay more.”
And
“Those who consume the most would pay more tax via the GST”

I honestly can say the same: I am no expert on economy and taxation at all; I just hand over the paperwork to our accountant, pay my taxes and hope for the best :)
I wouldn’t have participated in this discussion if you hadn’t brought up the thought of sustainability. I find this a very important issue that needs much attention.

What role can taxation play in meeting the target of making our energy supply as sustainable as possible? The focus should be on climate policy.

Pelican, I happen to have come across a speech a while ago on a greener tax system. The speech was not from Australia but from the Dutch State Secretary for Finance at the Brussels Tax Forum so I can’t say that it would be 100% relevant, but there are some good ideas.

The Finance secretary lists, in his speech, what his lessons he has to offer for using tax as a means to promote a more sustainable society.

* The tax aim and the environmental aim can be combined effectively. Tax polluting behaviour rather than clean behaviour.

* To use environmental taxes to lower other taxes.

* Find public support when introducing new taxes.

* Creating a greener tax system is best done in acceptable steps.

* To ensure that the number of taxpayers is kept as small as possible to be able to lower administrative burdens (and thereby saving).

* To deter environmentally harmful behaviour by making it more expensive and encourage eco-friendly behaviour by giving incentives etc,

I’d be very interested to read your or anyone’s thoughts.

Oops, I forgot to add the link to that speech:

http://tinyurl.com/5ruw8a

Mr nobody “limited understanding of what is fair,”

“Fair” is an entirely subjective and varies from person to person.

My partner has a son who thinks “fair” means, because she gave birth to him, she should support him and his drug, alcohol and verbal abuse until he or she dies.

Her and my idea of fair is somewhat different.

What large government does is interfere to pretend they make things “fair”, whereas small government leaves people to gro to their own potential for themselves.

I support small government.

You rightly comment on my fiscal knowledge.

I stated in my first post a desire to make things simpler and my response to you

“Banning NG would make the tax system more complex by applying differentials to tax laws based on mediums of investment and, likely, increase the rentals paid by tenants to cover the tax adjustment denied investors”

As for your discrimination claim and website: http://firsthomeowner2008.googlepages.com/

Rubbish!

Simplicity of system would leave the present recognition of NG in place because what you call “NG” is a norm for all forms of investment and is in line with current and historic accounting practice, that the costs incurred in production of an income are offset against that income to determine the operating return on which income tax is assessed, regardless the investment be residential housing, shares (margin lending (yikes scary), a small business, partnership pertaining to the tax entity or in the case of a corporation, all the activities of the corporation.

Your suggestion would treat investment housing different to all the other investments and be patently “Unfair”.

My elder daughter bought her first house, by herself at age 21 in 2001, without help from anyone else. She worked two jobs, in a call centre and for a real estate agent to get her deposit and costs covered. Now she work s as a senior supervisor in a different call centre and earns enough to drive an Mini Cooper S (which she paid for) and is looking for additional investment property.

Observation: she looked for solutions, you seem to be looking for excuses.

Cevilia “Tax polluting behaviour rather than clean behaviour.”

Who determines what is “polluting” and what is “clean”?

Using tax to reward and penalize would be wide open to wide abuses and expensive appeals and under-the-table fixes with government (ie loss of employment threats seeking government subsidies - like the auto manufacturing industry of today).

It is no different to reserve bank using interest rates to address inflation.

It is like using a chain saw to perform micro surgery.

The treatment being more detrimental to the patient, in this case the national and personal economies, than the original complaint.

I suggest leave tax as the method to raise funds for government to perform its duties and leave matters of environment and pollution and wealth distribution and all the other emotional feel-goods to direct legislative processes.

Like my answer to Mr nobody regarding NG, such processes which attempt to address particular “irkes” only complicate the tax system to the detriment of all, often with unseen consequences to the economy (job losses, higher rents, reduced quality of life, bigger bureaucracies of government which are less efficient etc).

Abolish Stamp Duty. Why should we pay five-figure sums to the State Gov't every time we buy a house? It's daylight robbery.

Getting rid of this tax would stimulate house sales, helping out the economy.

Celivia,

Your link is very interesting and a very workable tax system, if we are to progress to a sustainable community.

Environmental costs will be a need to be factor in the choices people make and eco-friendly behaviour should be rewarded with a lower tax bill.

This means tax the polluters and provide incentives to move across to non-polluting methods. This can be done in stages.

We cannot change to completely clean methods overnight, but we can impose higher taxes on those that pollute and reduce taxes on workers families and reduce taxes on profits for industries that are either clean or engaged in transforming to environmentally friendly methods.

We need to shift the tax burden; not necessarily impose higher taxes. Lower taxes on income and profits and increase taxes in environmentally unsound behaviour.

For example, companies manufacturing solar panels would benefit as sales increase and profits rise, whereas industries like mining would have to either pay a higher tax percentage or repair damage to the environment, moving towards preventing environmental damage in the first place.

Companies could benefit in reduction of unnecessary packaging by reducing their tax burden if they change their ways to recyclable packaging.

Also, to encourage greater use of public transport, there could be free tickets if travellers use public transport regularly for a minimum number of times each month.

I am sure that everyone at OLO can think of ways to use taxes as a way to transform our nation into one of environmental sustainability and more equitable as well.

I look for to some positive ideas.
________

Col Rouge – your knowledge of tax is in direct proportion to your self interest, however, your understanding of inequities in the current system is zero.

As Mr Nobody has observed you are unable to detect when there is imbalance or unfairness in the any tax system.

Also you clearly need reminding that this is a public forum, you don't dismiss me or anyone from posting our opinions. Disagree all you like - I welcome that, but don't dish it out when you clearly can't take it.

Fractelle “however, your understanding of inequities in the current system is zero.”

“As Mr Nobody has observed you are unable to detect when there is imbalance or unfairness in the any tax system.”

My statements is simple, any suggestion to use the tax system to fix what some might see as “inequalities” is the most pointless and stupid way of doing things because, the tax system is a very inefficient media for rectifying “unfairness”, taken that you can separate perceived “unfairness” from the components of real “unfairness” and real envy / differential ability.

I would note, pelican, who I thank for initiating this thread,

Acknowledged and agreed with me including the rider

“We are forever being taxed more for less and less services by government.

I see excessive tax as being equally unfair to everyone in the community, rich or poor. Excessive taxation erodes personal motivation and inspiration for people to achieve more in their lives. simply look at the history of USSR and the eastern Europeans, people risking death to escape from a system where individual achievement was not only criticized but was considered criminal.

In UK in 1960s some people were taxed at more than 100%. Marriage laws negatively affected an individual’s tax position. So wealthy people emigrated offshore and if staying in UK, remained single, rather than marrying.

Both those decisions could be considered as promoting the decline in social values but what else should individuals do when the tax system is expropriatory?

What is your suggestion to make things positive, rather than whine about what you think is unfair?

As for

“you don't dismiss me or anyone from posting our opinions.”

Your opinion is instantly dismissable. All you do is whine about the obtuse and how you dislike me.

Get this, I don’t care what you think. You can post whatever you want and if need be, phone womeone who might actually care but

If you post ad hominines at me, I will respond not just in kind but with leverage

Col

Thanks for your comments.

I did not expect you to agree as it takes a certain openness to understand ‘fairness’. An openness premised on the ability to put oneself in another’s shoes, or thongs.

With that in mind, I was thinking perhaps a look at NG* from another angle might give you a broader perspective:

http://feudaloptionsparty.blogspot.com/

*(that is, NG = negative gearing, the rort – a rort based on claiming Loan Interest deductions that exceeds income from source, talk about a dodgy practice)

Enjoy the breeze

Hi CR,
Your daughter has done very well for herself and the best time to start investing is at a young age. Good luck to her.

“Who determines what is “polluting” and what is “clean”?”
There needs to be a consensus on what “pollutants” are.
For example, there is clear scientific evidence and therefore consensus that pollutants such as CO2 and lead are toxic.

“Using tax to reward and penalize would be wide open to wide abuses…”
I suppose any tax system can be open to abuse. Have you read the article? The Secretary makes it clear that such tax system is possible, that in fact, it has been done successfully. His speech was about informing the other European countries about the successes and the govt’s further plans.
It can be done especially when the government has public support and when the new Green Taxes are introduced step-by-step. It was and is a democratic process and is quite popular.

About the manufacturers- they will, simply, need to fill the demands of the public. If the public demand greener products, the manufacturers will need to either reform to meet these demands or close.
I don’t really understand why this would be a big deal for the economy. If one manufacturer closes won’t another just fill the hole in the market?
I mean, there will always be a demand for most items that are on the market now, e.g. cars or washing machines. All that needs to be done is to manufacture a greener version of the same products. How hard can it really be?

And if the government can help by stimulating clean choices, why is this wrong?

Doesn’t a government have to always keep the future in mind when making decisions?
Isn’t that’s why they stimulate to save for the future through superannuation and encourage people to invest in Real Estate with incentives such as negative gearing and interest deductions- so that people have an opportunity to secure themselves for the future?

Continued

Securing a reasonably clean environment is even more important than securing financial freedom.
Without a healthy environment and ability to sustain ourselves no individual would even have a future to secure no matter how many investment properties or shares one has gathered.

Any government who does not take into account the wellbeing of our own and next generation is not acting in the best interest of the people.
Governments primarily have a duty to serve us, the citizens- not to fatten up the wallets of big corporations.
Leading a country is about balance and keeping the big picture in mind.

There is, IMO, nothing wrong with maintaining our environment, which is necessary for individuals to be able to flourish.
We all need to pay taxes and Green Taxes are about shifting taxes from the things we want, like our income, to the things we don’t want, like pollution and a toxic environment.

Fractelle, I like your ideas and I think you got it right; shift taxes from people to pollution and all of us will be better off including our future generations.

Col: "However, if in doubt, put faith in smallness rather than wisdom, it is more readily observable."

Well I can't argue with that on the face of it but something that is easily observed is not necessarily more effective. :)

Yes Blue Poles is a good example (one of many). I am an art lover and visit art galleries, I am not into sport but many people are - why taxes are expended on what are essentially 'interests' and 'hobbies' and is ONE area I believe the private sector take an active part. It is not that I don't value some investment in the arts/sport from taxes but not at the expense of more important programs at not at current levels.

Excessive taxation can be de-motivating and our many tiered system of taxation is particularly restrictive, not to mention deceptive.

BUT my main beef would have to be waste - as a government employee, I see both severe waste on one hand and badly directed spending cuts on the other (particularly in the areas that can least afford - usually the frontline or operational roles that deal directly with 'services' to the public). In my opinion as a humble government employee this is our role - to be of service - but this is not always facilitated for various reasons.

I would argue for balance and for a 'fairer' system. By fair I mean a fairer distribution of burden, remove tax avoidance opportunities and a simpler more straightforward method of taxation.

One aspect on my wish list would be for income splitting for one-income families with children. We have a one income earner providing a living for a whole family without much in the way of tax benefits. This provides a disincentive for those who would prefer to stay at home to raise their children.

I am realistic to accept this won't happen because the push at the moment is to 'encourage' more people back into the workforce to offset the skills shortage. A shortage that could easily have been avoided by better forward planning and management.

Celivia and Fractelle

Some great points regarding Celivia's link and the idea of a polluting tax. Taxing the polluting behaviour would provide great incentives for companies to commit to greener practices and assist in the goal of sustainability. This is exactly what I meant by using the taxation system to aid in the goal of sustainability.

A good example of incentives of this type are the grants managed by AFFA and EHA for water conservation projects. These could be expanded to provide incentives to business (not just non-profits) to include water saving and other energy/green practices in their business plans.

For example a car wash might choose to recycle water through a filter system and/or reed bed and then re-use the water. A grant to assist the set up such a system or a tax incentive would go a long way towards promoting environmental options.

The solar rebates are another great idea to encourage use of renewable energy. One day I can see a world where the kids are all shaking their heads wondering why their ancestors did not utilise better what nature gave us in abundance.

A taxation system that is designed to encourage green practices and discourage polluters or wasteful practices would not be difficult to attain whether via grants/rebates or direct taxation.

One reservation I have is that a tax may not stop the polluting behaviour and might rather mean that the consumer pays more for that product/service. It would only work if the environmental options were affordable (either via pricing or rebates). That is one of the problems I have with the carbon tax is that it does not stop the polluting behaviour. It can't work (I don't think) in isolation if these other incentives are not in place.

Mr nobody “I did not expect you to agree as it takes a certain openness to understand ‘fairness’. An openness premised on the ability to put oneself in another’s shoes, or thongs.”

Are you suggesting I am not open?
Are you suggesting, like Fractelle, I do not understand what “fairness” and being “fair” is all about?

How arrogant of you!

You have too little knowledge of me to make any such character assessment.

Because you interpret my support of small government and lower taxes as a non-understanding of what is fair and a lack of openness, defines your ignorance.

And your ignorance is no measure at all of my senses of compassion, fairness, ethics, empathy or philanthropy.

As to fairness, I headed the ethical standards committee of a professional organization for many years. Have you such experience on which to rely?

I suggest you keep your comments “objective” and desist in your desire to take cheap shots at my character based on your blatant ignorance or I might be prevailed upon to reciprocate in kind.

Celivia – my daughter is my hero. She is also the “happiest” person I have ever met.

“For example, there is clear scientific evidence and therefore consensus that pollutants such as CO2 and lead are toxic.”

But such things are not absolute, they depend on method of use and the availability of alternatives. Simply taxing them only makes the price greater for the user and often, since their use is a function of price.

The cheaper option for goods and services are more likely to be the heavier users of traditional processes and materials, example, hybrid cars, better for the environment but more expensive. Conventional cars: cheaper but relatively more detrimental, according to the “science” but who will be paying more, those who cannot afford a hybrid car – that’s who. Your suggestion is more likely to tax the poor who buy older second hand cars, than it is those who can afford the more up-to-date and more expensive alternative.

Celivia “Secretary makes it clear that such tax system is possible”

Many things are possible. It does not make them, necessarily, desirable.

My point is simple, regulating peoples freedom of choice, through progressive taxation, is an exercise in social engineering and an abuse of governmental powers. Government is not there to control our freedoms of choice, it is there to reflect our desires.

Small government and lower taxes leaves discretion with the individual.

Large government using differential taxes as a weapon to control personal discretion is “Socialism by Stealth” and an abuse of governmental authority, as well as being more bureaucratic and less efficient.

“Securing a reasonably clean environment is even more important than securing financial freedom.”

That can be done by direct legislation to the processes and materials used. You do not need to mess with the tax system to achieve it.

“We all need to pay taxes and Green Taxes are about shifting taxes from the things we want, like our income, to the things we don’t want, like pollution and a toxic environment.”

Disagree, taxation, like Denning said, is an imposition of government used to fund the necessary work of government, it is not a personal “need”.

Using “taxes” to engineer a particular social outcome is the least efficient way of achieving such goals. Better alternative is direct legislative action and possibly, where a lot of problems do lay, better regulatory observation.

I do not recall who it was but one poster on this site kept whining on about industry ignoring and flaunting the EPA regulations.

Getting away with flaunting regulation reflects a deficiency in the effectiveness of compliance officers.

“Government” is responsible for enforcing compliance.

I suggest look to government to administer its existing responsibilities before giving them more authority and more taxes to waste on more pointless exercises in social engineering.

Mr nobody your link http://feudaloptionsparty.blogspot.com/

I went there and received the following message

“This blog is in violation of Blogger's Terms of Service and is open to authors only”

Reads like that blog is full of crap and your “credibility”, is damned by association.

Pelican, taxing luxury goods is a bad idea once you consider the economic implications. It hurts the people who make the items far more than the people who consume. For example, if you tax boats, you would harm the local boat industry, while the rich would be more likely to spend their money on an overseas holdiay rather than a boat.

There are some rational ways to tax consumption, but you should restrict it to those activities that do real harm, rather than using it to attack the rich. Charging more for water and CO2 emissions is a good start.

http://www.ozpolitic.com/green-tax-shift/green-tax-shift.html

I would generally consider myself more a lefty, but I think I agree with most of what Col says.

I don't agree with using the tax system for environmental purposes as some have suggested. I think it's best to keep tax as simple as possible, and that will also make it harder to avoid, and much much cheaper to administer. I really think the tax laws in this country are ridiculously complicated.

What hits home for me is ...

'Using “taxes” to engineer a particular social outcome is the least efficient way of achieving such goals. Better alternative is direct legislative action and possibly, where a lot of problems do lay, better regulatory observation.
'

Col,

I understand the objections to NG, and I understand your opinion of 'why should housing be treated differently to other investments?'. I am interested what you think of allowing NG to owner-occupiers rather than getting rid of it for all. Seems like a solution to me. Especially since most owner-occupiers see their own house as an investment for retirement.

freediver
You do make a good point about luxury taxes and the effect on workers in those industries. The more I think about taxation and possible alternatives there is always a stumbling block of some sort - perhaps perfection is not possible. :)

Col and Usual Suspect

I do take your points about using taxation to, in effect "socially engineer" a particular outcome but governments do it all the time for less worthy reasons. Raising interest rates to fight inflation or making pensions unbearably low to encourage self funded retirement and the economic engineering that crept up on us to facilitate free trade and globalisation (such as WorkChoices to reduce real wages) and the engineering it took to reduce real living standards by forcing us into the 'working families' dual income scenario and fooling us into thinking we are better off while facing the largest ever debt crisis in our history.

If we are to be successful in the great task ahead of us to achieve sustainability and to put the brakes on the depletion of our natural resources, maybe this is the only option. [Population is another big issue but it does not look like getting a gong anytime soon in the debate, although there was a whisper of it during the 2020 Summit.]

Once peak oil is apon us you can guarantee there will be much greater social engineering than we have ever seen before and it will be by necessity but the human species will adapt - we are good at that.

Usual suspect thank you for your comments

Re “allowing NG to owner-occupiers rather than getting rid of it for all.”

Something like that was used in UK until the 1980s.

Personally if you make “self occupancy” a tax deductible you are opening the gate to suggesting food etc. should be deductible.The present method clearly distinguishes between “investment” and “self use”.

I believe it is better not to “blur” that clear distinction.

Pelican “but governments do it all the time for less worthy reasons.”

It is not good practice to perpetuate bad practice and you were asking for suggestions to “improve” current practices.

“maybe this is the only option.”

No all the options available are most commonly those which governments do not touch, like reducing the bureaucracy and simplifying processes. Withdrawing from areas where government is at a disadvantage. Like speculative banking (Victoria’s Tri-Continental multi-billion dollar fiasco).

People know best what is best for themselves, not government.

One option is for government to run on a balanced budget, with no massive surplus leave the money in the pockets of individuals who are best suited to exercise all the discretion possible.

“Once peak oil is upon us you can guarantee there will be much greater social engineering than we have ever seen before”

Not that it will do any good, it will simply increase the pain of shortages and push a struggling economy into stagnation. Leaving the market to respond is a better and more realistic solution than pretending a government managed fuel industry which always has the option of going “off shore”, beyond the reach of draconian government legislation.

The other thing is you will see an migration of “expertise” to other places in the world which do not adopt the social-engineering solutions of Australia.

We are all free, unless your “social engineering” intends to follow the communist model of iron curtains and Berlin walls.

“it will be by necessity but the human species will adapt - we are good at that.”

Yes it will adapt, with or without the pain of social engineering

Pelican,
” why taxes are expended on what are essentially 'interests' and 'hobbies' ….”
Agreed and I would like to add religion as well. Tax exemption for churches and their ability to claim govt subsidies. I really don’t mind tax exemption for not-for-profit charities (religious or not) if they can prove that their income REALLY goes to charity.
The non-charity part of religious organisations should not have exempt status.
When churches run businesses they have an unfair advantage over small businesses that are not exempted from paying tax. I’m not sure how much tax is spent annually on religion but I think it’s a fair amount. - just the school Chaplains cost millions.

AFFA and EHA are good examples, and there are other, smaller incentives as well; last year I claimed a $150 rebate for a front-loader. Water tanks and solar panels are partly refundable, too.

CR
You do have reasonable objections and I actually would not be that enthusiastic about govt. engineering under normal circumstances. But in the face of environmental threats and our (near) future sustainability we have to come up with the quickest way to achieve results while also trying to minimise economical damage.

” You do not need to mess with the tax system to achieve it.”
It would be great if there were an alternative way to achieve similar results. I’d have no objection to any other solution if there is a better one.
Other ways of stimulating manufacturers, companies and citizens to use cleaner energy has been tried for decades, but the results have been disappointing.
I guess it’s human nature to be reluctant to change and to want to remain in our comfort zones.

The experience with tax incentives has been that it works- money seems to speak louder than anything else that has been tried.
We need to act fast and apply the most effective way of reducing greenhouse gases and ATM ‘messing with the tax system’ seems to be the most effective way.

Continued

CR
“People know best what is best for themselves, not government.”
True, in ordinairy circumstances, but this global threat is not an ordinary circumstance and we don’t have the time to wait until every individual finally decides to take the right action that will benefit our sustainability. I see this more as a communal achievement than as an individual one because working towards a more sustainable future benefits everyone, not just some individuals. All people have a responsibility, also to future generations.
Don’t forget that the govt has the support of the majority on this separate issue, so doesn't that make it a democratic decision?

About affordability, don’t new technologies become more affordable when they can be mass-produced? If there is a generous rebate for energy efficient cars the demand will increase.
I don’t know any of my friends and family in Holland who still drives a non-hybrid car; the tax incentives have made a real difference in people's choices.
Cars have been placed into seven categories according to their pollution levels and each category is taxed accordingly. People then can make their own decisions when purchasing a car.

There’s also a very popular alternative to owning a car. Since the last 12 years, “Cardate” in Holland has been popular and very affordable. These Cardate companies e.g. “Greenwheels” receive tax incentives from the govt so that the price of Cardating can be kept to a minimum. These cars are parked on reserved Cardate spaces throughout the city, much like the ‘wheelchair’ spaces. One is charged by the hour. It’s a great system for people who can’t or don’t want to pay rego or insurance for a whole year if they only need a car for 1 or 2 days a week. My brother is a member of Greenwheels and loves the flexible system. It is so popular that other countries like Germany and Belgium have adopted this system as well.

Freediver,
thanks for that link.

There are some great suggestions coming from all the contributors to this thread.

The Commonwealth Treasury definition of effective government taxation :

"Taxation measures should meet revenue objectives (or other public policy objectives) and have regard to the principles of economic efficiency, horizontal and vertical equity, certainty and transparency whilst minimising compliance and administrative costs. By meeting these aims, taxation measures contribute to the wellbeing of Australians, either directly or by providing the revenue base to finance government ".

I wish to repeat a line from the above definition (no facility on OLO for bold italics).

“....taxation... contributes to the wellbeing of Australians…..”

Our wellbeing is under threat from a polluted environment and from mismanagement of finite natural resources.

A healthy, diverse natural environment is valuable in itself; it is also essential to human wellbeing.

Taxation is simply a part of the overall means we use to maintain ourselves and our communities. We can make individual choices that either deplete the environment (non recyclable goods; built-in obsolescence, high polluting manufacture) or we can choose to purchase consumer goods that are recyclable, long-lasting and minimise environmental impact.

The role of the government is to facilitate what is best for the community. It is not about controlling the individual, but it is about providing the incentives for responsible behaviour. Only the government is in a position to do this. After all who would want a private corporation to decide what is in the interests of us all?

Increasing taxes on damaging environmental activities such as burning fossil fuels and reducing taxes on socially beneficial activities such as development of renewable fuels, should be a no-brainer.

Instead of a narrow focus on GDP growth, objectives should include investment in sustainable public infrastructure as well as reducing social and regional inequalities.

To determine accountability, a set of national accounts could monitor our progress. These could report on the state of our communities, our health and the state of the environment. Governments should be judged by how much our wellbeing/environment improves, not by how much the economy expands.

Without a liveable environment we have nothing.

Celevia, thanks for your comments

“But in the face of environmental threats and our (near) future sustainability we have to come up with the quickest way to achieve results while also trying to minimise economical damage.”

“True, in ordinairy circumstances,”

I seem to get the feeling that you believe the “environment” and “climate-change” is a “special case”, distinct and separate to all of the other blights and maladies which detract from a quality life.

I would far sooner see you qualify/quantify real reasons and tangible, specific objectives to be achieved, rather than treat the environment and climate change as a “special case”

Experience has shown me, time and time again, there are only two cases, good cases and bad cases. A “special case” is merely a bad case being dressed up, for whatever reason to appeal, emotionally to people, regardless of its lack of merit.

Again, please present quantifiable and concrete objectives, rather than presuming that additional taxation is some universal panacea capable of healing the pain of “sustainability”.

Fractelle “The Commonwealth Treasury definition of effective government taxation”

Whilst you might choose to believe the government treasury, I would suggest their position and authority is not one of political indifference or objectivity.

The Government Treasury has a vested interest in presenting their role in managing the economy, for the greater glorification of the Government Treasury.

“Taxation is simply a part of the overall means we use to maintain ourselves and our communities.”

Agreed. Taxation is “part of”.

Taxation is not the exclusive option available to maintain ourselves or our communities. I suggest emphasis be based on the other options whilst working on simplifying the tax system, for the benefit of all, especially tax payers.

“Without a liveable environment we have nothing.”

A livable environment purchased at the price of individual discretion is not necessarily a good contract.

We are all endowed with "Freedom of Choice", eliminating it for want of a "livable environment" questions what we need a "livable environment" for; if not to give us opportunity to develop and grow through the deployment of our "freedom of choice".

Col Rouge

Suggest you read people's posts with a little more focus, you claimed:

"A livable (sic) environment purchased at the price of individual discretion is not necessarily a good contract."

No one has suggested that we lose individual choice, in fact any progress to a sustainable community will require individual choice at a grass roots level as well as organisational contributions for anything to change.

As I previously stated:

"We can make individual choices that either deplete the environment (non recyclable goods; built-in obsolescence, high polluting manufacture) or we can choose to purchase consumer goods that are recyclable, long-lasting and minimise environmental impact."

BTW The Commonwealth Treasury's definition of Taxation was prepared by the Howard government in 2003.

Cheers m'dear

If taxes slow economic progress, surely over time, countries with high taxes will fall behind those with lower taxes. What does the data show?

Neil Brooks a Canadian who teaches tax law at Monash University/Melbourne, "Countries with high taxes tend to have significantly better social outcomes than those with low taxes and their economies appear to be largely unaffected by the required higher taxes."

Drawing on OECD statistics, Brooks divides Western countries in four; the low-tax Anglo-Americans (including Australia), high-tax Nordics, medium-high continental countries such as Germany, and medium-low Mediterranean countries; and compares outcomes on a wide range of economic and social-measures.

In 2004, three of the four largest Anglo economies saved less than 5 per cent of their income: Britain 4.3 per cent, Australia 4.1 and the US just 1.9 per cent. By contrast, Norway (a special case because of its oil riches) saved 19 per cent of its income, Sweden 11.7 per cent, and the Nordics on average 11.6 per cent.

On other economic measures, the high-tax Scandinavians lead the low-tax Anglos. Far from high tax rates deterring work, their workforce participation rates are the highest in the world, especially for women. They invest far more in research/development. In national income per head, the World Bank ranks all five Scandinavian countries in the world's top 20. (Australia is 21st).

The real difference between Anglos and Scandinavians, Brooks argues, is in the distribution of income. THE FIGURES SHOW HIGH TAXES GO HAND IN HAND WITH HIGH SOCIO-ECONOMIC EQUALITY AND LOW TAXES GO WITH HIGH INEQUALITY.

In the US, the top 10 per cent take home 16 times more income than the bottom 10 per cent. In Australia, those at the top get 12.5 times as much as those at the bottom; whereas in Sweden, Norway and Finland, the ratio is 6:1.

In Anglo countries on average, 16 per cent of children in 2000 lived in poverty, including 45 per cent of children with sole parents, OECD figures show. In Scandinavia, 3 per cent grew up in poverty. It's a massive difference, and ultimately due to different tax levels.

Fractelle “No one has suggested that we lose individual choice,”

I would suggest part of your discretionary income being diverted into government taxes or the price of some goods and services being increased by gst or “sales type” taxes does, indisputably, curtail your individual choice by making some choices more expensive and possibly no longer affordable.

“in fact any progress to a sustainable community will require individual choice at a grass roots level as well as organisational contributions for anything to change.”

Sounds too much like “for the common good” and I have never met anyone who has met anyone who has actually spoken with “the common good”.

If you insist on making a case for something, do it with tangibles, not social theories of the intangible.

“organisational contributions for anything to change”

Change is inevitable, that does not mean it is either desirable or positive.

Most positive changes are initiated by people following what they see as common sense and not what some bureaucrat, local or remote, deems as an “organizational contribution”.

“BTW The Commonwealth Treasury's definition of Taxation was prepared by the Howard government in 2003”

It was prepared by a bunch of bureaucrats at the ATO whilst Howard was in the seat.

“Countries with high taxes tend to have significantly better social outcomes than those with low taxes and their economies appear to be largely unaffected by the required higher taxes."

I did an analysis of correlation comparing “happiness” and national levels of “tax as a % of GDP” and posting it on a Fred Argy article and happy to repost it here.

Contrary to your statement ascribed to Neil Brooks, progressive taxation had a -.315 (negative) correlation with happiness.

I know what “happiness” means.

As a contributory measure of “life quality”, surely one of the principle goals of living, happiness matters.

Greater “happiness”, derived from lower taxes, rates as a worthwhile outcome.

You and Neil Brooks need to define what “better social outcomes” actually means in terms of “life quality” before you even attempt to present it as a worthwhile goal.

Fractelle,

'THE FIGURES SHOW HIGH TAXES GO HAND IN HAND WITH HIGH SOCIO-ECONOMIC EQUALITY AND LOW TAXES GO WITH HIGH INEQUALITY.
'

That's just socialism/communism really. Humans are not all born equal. I am happy enough if society allows equality of opportunity, rather than enforcing equality of outcome.

Fractelle,
You have made excellent points. You demonstrated that higher taxes are associated with higher equality. That makes sense; countries with higher tax rates can afford to run a better social and health network.

US
Don’t you think it’s unlikely that children, who happen to have been born in poverty, have equal opportunities to children that were born in reasonable environments?

CR
What definition of government do you support, if you reject the one that Fractelle posted?

About happiness,
Initially, it makes sense that people who pay lower taxes are happier than people pay higher taxes.
For the rich, it means men can buy some more hair and women can have their wrinkles zapped in societies where children grow up in poverty.
But it makes no sense that low-income people, for whom it probably makes no difference whatever the tax rate is as they fall in the low tax bracket anyway.
For low incomers, it makes sense that they are happier living in societies with more opportunities and equality.
So, I’m confused about these results.
I am not convinced that the outcome of the happiness survey was derived from a proper cross section of societies. I’d be interested to see the Fred Argy article; perhaps I’m missing something.

About tax shifts,
I’m not even sure why people would be opposed to tax shifting; it’s not even about paying more tax in total; it’s about being more creative with tax- it’s about shifting what we already pay.

” A “special case” is merely a bad case being dressed up, for whatever reason to appeal, emotionally to people, regardless of its lack of merit.”
Yes there are more global challenges than the global environmental crisis alone but none are such serious threats as that for it effects us all and future generations as well.
I’m not sure if I understand why you think that the environmental issue, specifically greenhouse gas levels, lacks merit. The environmental crisis threatens our sustainability, and something needs to be done about it urgently or the problem will get worse.
Perhaps it would have been clearer if I had used the word “urgent” rather than “special case”- which I agree could appeal as emotional.
But whether people feel emotional about the level of greenhouse gases or not is irrelevant because the fact remains that the environmental problems exist.

Do you actually agree to the fact that sustainability is under threat and that prompt action to clean up our environment is important?

I agree on quite a few things with Libertarianism, just not to the extreme (and isn’t there such system as libertarian-socialism?).

I fail to understand why there has to be friction between (even extreme) Libertarianism and environmentalism.
For example, don’t you, as a Libertarian, have a problem with the fact that people and manufacturers emit pollutants into our shared air- the air that enters your private property? I do.

Cevelia” Fractelle, . . You demonstrated that higher taxes are associated with higher equality.”

No, Fractelle has demonstrated higher taxes equates with more equal outcomes. It achieves this by cushioning the less able and penalizing the more able.

That is not the best option if you want to achieve the best overall outcomes.

You seem to miss my point, whilst draconian taxation can achieve “equality of outcome”, it only does so be denying individuals the opportunity to improve their cirumstances and benefit from their own effort.

You might be happy to see a world full of “average people of median height” but I believe everyone is better off is we allow people to grow to the extent of their individual potential.

As Margaret Thatcher said

“Let our children grow tall, and some taller than others if they have it in them to do so.”

Do not “level” them with tax disincentives.

“What definition of government do you support,”

Smaller government, which respects the spirit of individuality from which all human progress stems.

I do not understand your comment re “tax shifts”, I want less tax, not shifts in tax.

“none are such serious threats as that for it effects us all and future generations as well.”

Disagree, I would place total world population of people as the most fundamental threat to present and future generations.

Fix / reduce population numbers and things like environmental degradation and pollution etc are not only more manageable but actually contract and possibly cease to be a problem at all.

“For example, don’t you, as a Libertarian, have a problem with the fact that people and manufacturers emit pollutants into our shared air- the air that enters your private property?”

Show me where, on this thread, I have defended the position of polluters and you might have a point.

This thread is about improving the stupidities of the Australian Taxation system.
That is what I have been addressing.
You seem to think we should use “taxation” to rectify environmental and social issues, which I have already said, would be better addressed with direct legislation.

Cevelia” Fractelle, . . You demonstrated that higher taxes are associated with higher equality.”

No, Fractelle has demonstrated higher taxes equates with more equal outcomes. It achieves this by cushioning the less able and penalizing the more able.

That is not the best option if you want to achieve the best overall outcomes.

You seem to miss my point, whilst draconian taxation can achieve “equality of outcome”, it only does so be denying individuals the opportunity to improve their cirumstances and benefit from their own effort.

You might be happy to see a world full of “average people of median height” but I believe everyone is better off is we allow people to grow to the extent of their individual potential.

As Margaret Thatcher said

“Let our children grow tall, and some taller than others if they have it in them to do so.”

Do not “level” them with tax disincentives.

“What definition of government do you support,”

Smaller government, which respects the spirit of individuality from which all human progress stems.

I do not understand your comment re “tax shifts”, I want less tax, not shifts in tax.

“none are such serious threats as that for it effects us all and future generations as well.”

Disagree, seriousness is a subjective measure and I would place total world population of people as the fundamental threat.

Fix / reduce population numbers and things like environmental degradation and pollution etc are not only more manageable but actually contract and possibly cease to be a problem at all.

“For example, don’t you, as a Libertarian, have a problem with the fact that people and manufacturers emit pollutants into our shared air- the air that enters your private property?”

Show me where, on this thread, I have defended the position of polluters and you might have a point.

This thread is about improving the stupidities of the Australian Taxation system.
That is what I have been addressing.
You seem to think we should use “taxation” to regulate and rectify environmental issues, which I have already said, would be better addressed with direct legislation.

Pelican started this thread for suggestions on creating a fairer tax system. Most contributors have made positive suggestions: eliminating negative gearing, shifting tax burden to polluters, ensuring all members of the community benefit, developing and maintaining infra-structure etc.

In spite of this Col Rouge maintains that low tax, no change is the way to go. Why? For, his sense of superiority has to be maintained, with blanket statements like this:

“No, Fractelle has demonstrated higher taxes equates with more equal outcomes. It achieves this by cushioning the less able and penalizing the more able.”

In Col’s little world if you are not wealthy then you must be “less able”. Apart being completely wrong, it is one of the most bigoted things I have read here on OLO.

Col and his ilk don’t want to change their privileged lifestyles. Under a pro-environmental tax system, he would pay more for the privilege of driving his Bentley. He would no longer profit from negative gearing.

What is ironic is that he claims that he is a libertarian, well so am I. But the difference is I (and many others) see our community as an important and integral part of being human and we know that to continue living in a free and democratic nation, we need to contribute to it; maintain it. None of us are truly free in that we are not free to drive as fast as we would like, or drink and drive – there are many rules created to keep the extremes that complete liberty would create in check. In fact ultimate libertarianism is really just a form of anarchy and self obsession.

Cont’d

Cont’d

Two Facts:

1. The most libertarian, capitalist nation on earth is the USA. It has the highest rate of crime and poverty out of all the OECD nations.
2. Whereas, the more equitable nations like Holland or Sweden have lower crime, higher standards of living for more people.

For those who favour the USA system, their motivation is profit NOW rather than plan for future generations.

Everyone, except Col, has suggested ways in which tax could be changed to a more equitable system that also maintains our environment. At no point did Pelican ask Col to “improve the stupidities” of the current tax system. That he has interpreted this discussion as such, speaks volumes about his personal agenda and his low opinion of everyone except for himself.

Col you have argued yourself into a corner, you have nothing positive to contribute. This is not a personal attack, it is simply an analysis of the posts you have made here. Every single point you make is about justifying your position, not a single one has been about creating a more equitable nation.

What the Cols of this world fail to understand is the principle tenet of sustainability is that power is shared, and essential power is achieved through collaboration, not dominance.

Fractelle

I have been reasonably patient but you are become obnoxious and so I will say something about your putrid post.

“In spite of this Col Rouge maintains that low tax, no change is the way to go.”

A misrepresentation of my statements.

I promoted, with reason and have gained support, through acknowledgements to their merit, suggestions to reduce tax and change to lower overall tax take. Savings being produced from smaller, not currently sized, government .

“Why? For, his sense of superiority has to be maintained”

Slap on with the ad hominines, Fractelle, they are the high light of your drivel.

“In Col’s little world if you are not wealthy then you must be “less able”.”

Please show me which statements I have posted actually support this crude and blatant judgement of my “world view”

“Apart being completely wrong, it is one of the most bigoted things I have read here on OLO.”

Yes it is completely wrong and the bigotry is all yours.

“Col and his ilk don’t want to change their privileged lifestyles.”

Wrong again. Col and his ilk (the other sons of railway workers) see “privilege” as being earned and not a birth right. I see it being earned through the respect and kudos associated with excellence in reasoning, performance and character.

That you seem to think that everyone should be rewarded equally, regardless of the merit of their contribution, is completely beyond my reasoning skills. Thus, I suspect it has less to do with “reasoning” and more to do with the small minded envy which people, of low character and absence of skill, cleave to in denial of their lack of mediocrity. As supported by your sniveling posts.

“libertarian, well so am I (fractelle).”

“In fact ultimate libertarianism is really just a form of anarchy and self obsession.”

You are “self obsessed”.

“Col you have argued yourself into a corner, you have nothing positive to contribute. This is not a personal attack,”

That is definitely an attack.

Your envy, incompetence, slag attitude and Angst are no deterrent to my reason.
Reasoning which is beyond you.

Freedriver,

Hi! You have junped track woth unfinished busines 29/4 - 1/5:

http://forum.onlineopinion.com.au/thread.asp?discussion=1722&page=0#34063

Please complete.

Cheers.

Fractelle,

I think I'm pretty impartial, and I think you're getting your knickers in a twist just because you don't like Col's opinion. Play the ball and not the man.

'Col and his ilk don’t want to change their privileged lifestyles. Under a pro-environmental tax system, he would pay more for the privilege of driving his Bentley. He would no longer profit from negative gearing.'

That statement really weakens your argument. It shows you coming from a class-envy position. You seem to be quite socialist, which is fine, but I see you attacking Col for daring not to agree with your political leanings. As it happens I think a pro-environmental tax system would actually affect the poor more than the rich.

Having said that I am happy for my taxes to look after the less fortunate, as I'd rather not have to live in a gated community. I'm happy for the government to look after health and education, and I don't think private schools should get any money from the government. One thing I do hate though is churn, and middle class welfare and business welfare.

So obviously I'm actually pretty left leaning myself, but I think a lot of lefties forget that the rich do pay a lot of tax, regardless of the percentage of their income, and employ a lot of people as well. Also fortune favours the brave, and if you take risks you deserve some reward.

CR
“You seem to miss my point, whilst draconian taxation can achieve “equality of outcome”, it only does so be denying individuals the opportunity to improve their circumstances and benefit from their own effort.”
I feel that I got your point, but my point is that people who fall in the higher tax bracket already have the opportunity to improve their circumstances and have benefitted from their own effort.
They are doing well, financially; they can buy investments which will create greater financial freedom; they can travel and get to know the world; they can save, borrow...the list of opportunities is long.

”You might be happy to see a world full of “average people of median height” but I believe everyone is better off is we allow people to grow to the extent of their individual potential.”
I wouldn’t disagree if you meant that we allow ALL people to grow- especially when these people are children.
The vast majority of countries today do allow for personal development, for diversity,
But it’s important that every child receives at least its basic needs to be able to develop to its full potential.

You quoted Margaret Thatcher.
“Let our children grow tall, and some taller than others if they have it in them to do so.”
Nice idea, but I’d like to add that children should be given the opportunity to develop to their full potential.

One particular tree might have the potential to grow as tall as another, but if that tree was planted in a too dark, too dry corner and therefore denied its basic needs, it won’t be able to grow to its full potential.

Continued

“Do not “level” them with tax disincentives.”
While you may prefer to SEE a forest with trees of different heights, would you want to BE the smallest tree that was planted in the gloomy corner, deprived of its basic needs?
If all the trees that stand high in their excellent locations, enjoying an oversupply of water, were asked to donate SOME from their oversupply (not from their basic needs supply) to the little tree, that little tree would have a bigger chance to reach its potential height while the tall trees’ potential would not even be threatened as their basic supply was untouched plus they still had most of their oversupply left.

If you were a tree, which forest would you prefer to grow in?
If you were to buy a forest for timber harvesting, what kind of forest would bring you more income?

I will end with a quote by Carol Bellamy to accompany your one by Thatcher:

"Investing fully in children today will ensure the well-being and productivity of future generations for decades to come.
By contrast, the physical, emotional and intellectual impairment that poverty inflicts on children can mean a lifetime of suffering and want – and a legacy of poverty for the next generation."

Hey US

No need to worry about my knickers mate. If I appear to playing the man rather than the ball at this stage in the thread, it is for the following reasons:

Col (if you care to read his prolific postings on OLO) is always about justifying HIS choices, HIS lifestyle, I have yet to read him making any posts that suggest a hint of altruism to his world view.

As I previously pointed out he has not offered any practical measures by which we can achieve a more equitable system of taxation for Australia. Whereas, everyone else has tried to offer solutions, Col refers to it as solving "stupidities".

I am well aware that there is no reasoning with some people. What I have tried is to present alternatives to Col's oft repeated "small government, low tax". There are better ways, the discerning reader can determine for themselves that this is so.

I don't believe in big government either; we need efficient and fair governance.

Col's division of people into 'able' and 'not able' based purely on wealth, is laughable. There are many who make huge contributions to our nation and receive little in the way of monetary recompense. Col's pre-judgement of people based on material worth is insulting to all.

If I have failed to convince you of a need for fairer taxation, I am not going to worry. There are plenty of people who believe in a fair and democratic governance and taxation. And also the business opportunities that new environmentally friendly technology offers.

There are always improvements we can make, Col would keep us in the 80's (Thatcheronics) - he is not about change, he wants to retain the status quo, simply because it benefits him.

We can all try to be as objective as possible, but we are still human (even Col) he is no more objective about his fondness for money, than I am about the levels of pollution. I can't ever change Col but I can do my bit to create a safer environment.

And have some fun along the way:

http://images.ucomics.com/comics/nq/2008/nq080429.gif

Fractelle “is always about justifying HIS choices, HIS lifestyle, I have yet to read him making any posts that suggest a hint of altruism to his world view.”

Ah well, this is an “Opinion forum” after all.

If I were not to justify my choices and my lifestyle – who on earths choices and view should I justify?

As for altruism, I do not brag when I do something for someone else. I do not declare what charitable donations I make.

I can think of no greater “altruistic” act than to respect and support the right of other people to make up their own choices and way in the world.
No point in freely feeding a man if it is at the price of his mind, personal choices and discretion.
That results in a form of slavery.

“As I previously pointed out he has not offered any practical measures by which we can achieve a more equitable system of taxation for Australia.”

I made suggestions to improving the Australian tax system, which others have acknowledged and some agreed with.

What Fractelle is promoting is slavery to the state, through excessive taxation. No one allowed to benefit from their own effort more than what the state decrees. Every small minded real or wannabe dictator produces the same outcome.

“I am well aware that there is no reasoning with some people.”
That sounds like a confession.

“I don't believe in big government either; we need efficient and fair governance.”

But you disagree with my preference for smaller government. Strange.

“Col's division of people into 'able' and 'not able' based purely on wealth, is laughable.”

I never suggested that

I stated “To “help” the less able, increase personal tax thresholds.”

I see my life not purely in material terms, otherwise I would be out earning, instead of here writing for free.

Some of my “wealth” is:

being free to make choices for myself and to benefit or suffer the outcome of those choices.

Enjoying the arts
Family and friends
Respect of my professional peers
Many other things which have no “monetary/material value”.

This thread was clearly about tax, pelicans first sentence:

“Thinking again about the Summit and talk of changes to the current taxation system made me wonder if OLO contributors had any ideas that might improve our current system of taxation. Our own mini-Summit on taxation.”

Not about the wider range of human delights which most people are impassioned by.

fractelle “If I have failed to convince you of a need for fairer taxation, I am not going to worry. There are plenty of people who believe in a fair and democratic governance and taxation. And also the business opportunities that new environmentally friendly technology offers.”

Oh so may weasel words and no “substance”.

Soft cuddly niceties and no concrete tax proposals.

“There are always improvements we can make, Col would keep us in the 80's (Thatcheronics) - he is not about change, he wants to retain the status quo, simply because it benefits him.”

Wrong. I refer to MT because she managed the UK economy out of collapse and changed the culture to a realistic one.

Re-read my posts, you will see I consistently refer to the inevitability of change and that includes the “status quo” and what benefits me is my own capacity for analysis and being able to see an opportunity.

“We can all try to be as objective as possible,”

You are the only one who seems to lack “objectivity”. You seem to prefer, as I said early up this post, Soft cuddly niceties and no concrete tax proposals.

Instead of challenging my suggestions, you have decided on the lazy course and decided, as US correctly points out, to attack me.

I have a simple policy, people may challenge my view and I will debate them, as for instance pelican and Cevilia and many others have done and I will argue the point respectfully.

But if someone “dumps on my doorstep”, as you are doing, I will wash you away with the rest of the effluent.

The choice, to be denigrated or not, is entirely yours

Hi Cevilia sorry to delay getting back to you, I was “putting out the garbage”.

My point your point, we understand.

Now my point expanded,

Question: What merit does you “view” possess, which gives it the right to curtail someone else’s discretionary choices, when the range of those choices are afforded them by previous decisions and risks which they have made or taken?

“Nice idea, but I’d like to add that children should be given the opportunity to develop to their full potential.”

That is what Margaret said. She certainly did not suggest otherwise.

Trees and people, a flawed comparison until you can establish that trees have freedom of choice, to where they grow or have some cognitive control on in which direction they will grow.

I am not an agronomist. I have little concern for the commercial development of trees. I care and tend to the ones in my garden. They attract a wide range of parrots and other birds, who, whilst noisy, enhance the quality of my life by sharing time with me. Strange what I find delight in.

I am not all about money but taxation is.

Regarding your quotation of Carol Bellamy, Margaret Thatcher was Science and Education Secretary (Aussie = Minister) in the Edward Heath government. She improved the nature of the UK education system and made a massive and ongoing contribution to improving the education of children in UK.

I suggest http://en.wikipedia.org/wiki/Margaret_Thatcher#Education_Secretary_.281970_-_1974.29

You will find she was a brave and courageous woman from the start of her political career and would have done many things which you agree with.

I hope, I can claim to be, like her, more avowed and true to my values than to any political label others may stick upon me.

Col and Fractelle

Col

I also went to my blog and received the message:

“This blog is in violation of Blogger's Terms of Service and is open to authors only”

I thought about your comment “ Reads like that blog is full of crap and your “credibility”, is damned by association”.

There is another possibility – the message might simply indicate that the Blogging service is not up to scratch. Perhaps they would not know quality piece of literature if they fell over one. You never know -

Anyway, I gave up on that blog. Thanks for advising the service was shonky.

Fractelle

Good posts, you seem to have the interests of the wider community at heart.

For your reading leisure:

http://feudaloptionsparty.googlepages.com/investorsruleok

The last time I checked it was working.

Happy Labour Day you both

mr nobody

Thank you for your kind words - if you understood the points that I had made then others will too. Your link was interesting, but have never heard of the F.O. Party. Heheh - 'Feudal' sounds like something that Col would favour. But I digress, will study at my leisure - I too am concerned that a secure roof over one's head is becoming unachievable as disparity increases between the majority of people and a powerful minority. (Now that's feudal). All the environmental programs in the world will not work if people cannot afford housing.

I would also like to thank CELIVIA; your persistence and cogent arguments on this thread deserve praise. Also you were able to provide evidence of actual working solutions that are occurring now in the Netherlands. Not something that is easily dismissed.

One last item before I totally bail on this thread.

COL

ROFL

You sure expend a lot of time and energy responding to people you have described as “dismissable”. What would the ratio be of your posts to mine? About 4:1? Happy to keep you so occupied.

BTW. Yes, we get it that you favour low tax and love Maggie Thatcher, anyone reading these pages knows that.

What you haven’t done is offer much at all (if anything) about sustainable living. About transferring tax from profits and income across to polluting industry and excess (by excess, a true luxury tax on items that are both not necessary AND costly to the environment to manufacture). A quick example, hybrid cars are costly but will prove to be beneficial in the long term. Whereas, SUV’s are costly but are detrimental to environment (think petrol, size, safety factors).

All you continue to do is justify a system that benefits Col Rouge at the expense of the majority of people. Nothing new there.

You love demeaning people with whom you disagree rather than offer cogent debate and remember no-one is 100% wrong all the time. Not even you :-D

Choice is what it IS all about – I totally agree.

You have the choice to remain mired with Maggie in the 80’s

Or

Catch up to the 21st Century and join the rest of us humans.

THE CHOICE IS YOURS.

We can all come up with examples of waste. A simple tax system mindful of low income earners and one that ensures a contribution by the wealthy while retaining incentives for business within a social democratic system is a worthy goal.

- Get rid of GST, reduce waste in government and concentrate on a true "public service" where our most essential needs are given priority. One of the problems with GST is that it is a burden on business to adminster.

- I am not suggesting that government become small (only smaller) and see a need to eliminate waste so that resources are redirected to areas of priority (hospital waiting lists, environmental sustainability, education). We are a small population by world standards yet we have three tiers of government which is rich fodder for a 'Yes Minister' script.

- Don't involve ourselves in unnecessary wars and the money saved could ensure pensioners are not living below the poverty line.

- Not everyone will agree on what could be classified as wasteful but some examples have already been given by other posters and include just to start with taxes spent on religion, sport and the arts. These are personal life choices and can better sponsored by the private sector or by parishioners (in the case of churches).

- There are other areas within government where there is overlap such as national security and senior levels of law enforcement where more people are needed on the ground not up in the ivory towers of decision making.

- Anyone who has worked in government over the last 20 years since the advent of economic rationalism knows too well that when cuts are made to government it is always in the service areas while numbers at the senior level continue to grow with no tangible benefit to the taxpayer. Taxpayers in the main would rather get their call answered more quickly by Centrelink, not wait in queues for inordinate lengths of time, have their operation performed to alleviate pain or know that there are enough police and fire personnel on the beat.

Continued...

continued from above...

- Get rid of fees for higher education. Education is not a commodity to be exploited and dumbed down in the process, it is the foundation of a skilled and innovative workforce. Make it merit based and provide more funding for scientific research and development.

Fractelle,
Thank you, like I said I'm not at all an expert, just expressing my view whether it's right or wrong :)
Yes I understood the points you have made, especially about affordable housing.
Shelter is a basic need so any country that fails to provide affordable housing must be doing something wrong.

CR
I’ll try to explain about the merit of my view.
In principle, I agree with you that people’s choices should not be restricted especially when they have increased their options by taking risk.
But I am not at all convinced that extreme Libertarianism will achieve a society full of unrestricted choices because the very choice one person makes may restrict someone else’s choices.
While it would benefit some people to pay less tax and increase their choices, less tax may mean that someone’s child may be refused medical treatment because there is no money in his family for health care.
This is not the child’s fault- the child has not made choices.
It would be a little more convincing if we were talking about adults only. But there are children involved.

With my ‘little tree in gloomy corner’ story I was trying to make that same point about children. I didn’t get that point across but I was alluding to children that are born in disadvantaged, poor families.
Babies have as much choice of environment as a tree has.
The baby did not choose to be born in a disadvantaged family; the tree did not choose to be planted in a dark, dry part of a forest.
And even though the baby born into poverty did not choose this, it has no chance to be offered the opportunity to develop to its full potential unless a welfare system is available that will offer him/her healthcare, education, supply of basic needs such as housing and food.
I believe that all people, especially children, no matter what, should have a certain standard- a package of basic needs.

Even under the leadership of Margaret Thatcher -and I agree that she has done a lot of good for the UK - she did not solve the fact that children lived in poverty and were suffering malnutrition.
Any society that does not offer affordable housing (as others have mentioned), education, health and so on, is failing all the children who are living, through no fault of their own, in poverty.
The most vulnerable will have the least choices while the most powerful have the most choices just because they happen to have been offered opportunities during their childhood years that enabled them to develop to their full potential.
There are exceptions but generally the above statement is true.

So, I am not convinced at all that total libertarianism is the answer to guarantee everybody freedom. Especially not the kind of Libertarianism as practiced in the US.
Big corporations can be even more tyrannic than a government.
Obviously, communism is not the answer, either.
Both sound convincing in theory, both make a lot of promises of Freedom.
Neither seems to work in practice.

I believe that the best option would be some form of libertarian socialism, some form of balance, with common sense.
Having said that, there are quite a few different forms of Libertarianism and I don’t have a lot of knowledge about the differences.

Then again, I may be missing something- but I thought I express my ideas anyway because as Fractelle said, “Nobody is wrong all of the time.” (Funny!)
And nobody is right all of the time either, we ale all imperfect.
We have no perfect political system- it does not exist.
We have to make-do with what we have and imperfect people will continue to improve on it.

From my reading of Col_Rouge's posts over time, he studied Art in London in 1978, dropped out then moved into accounting. He is probably on the ethics committee of National Institute of Accountants, at a stretch he is a Chartered Accountant, probably not a Certified Practising Accountant. He lives in the eastern suburbs of Melbourne. He moved to Australia in 1981 and is a strong adherent of the economic policies of Milton Friedman and the Chicago School of Economics, whether he is aware of this or not. Have you heard that Margaret Thatcher's son Mark has been implicated in providing mercenaries to overthrow a government in west Africa. He supplied mercenaries to overthrow the PNG government.

My friends and I counted up how much money we pay in taxes, we included direct taxation, health insurance and superannuation and found that Australians earning average wages pay more tax than Swedes. We don't want to live in fear that we won't have enough income in our old age to receive adequate health care to keep us from pain and suffering from treatable conditions. We wonder how the majority of university students are going to be able to pay off their HECS debt, buy a house and get pregnant before they are too old to be fertile. Individuals can overcome poverty to reach the highest levels of society but they are very rare, think Evo Morales in the coca farmer who is now president of Bolivia despite strenuous United States opposition. Anyone with any familiarity with poverty doesn't lightly dismiss the Australian statistic that 49% of children in sole parent families are growing up in poverty with all the stunted outcomes that that entails.

Of course history and literature shows us the british are very used to treating poor people as a different species that don't deserve shelter, employment, adequate food, health care. In the 1860s depression that half the population of Birmingham died of starvation. Recent history shows that the United States isn't concerned about the welfare of black americans flooded out of New Orleans in hurricane Katrina.

Pelican

“Get rid of GST”

I disagree, it is a broad based tax which is relatively easy to calculate and recover.
I would, however, force through the delisting of the taxes which it was supposed to replace, like land tax, some stamp duties etc.

“government become small (only smaller)”

I agree with you, small might be the ultimate goal but smaller is where to start.

“Don't involve ourselves in unnecessary wars”

I disagree, that is not a tax-simplification measure and even if it were, no government of any persuasion could ever guarantee it.

“These are personal life choices and can better sponsored by the private sector or by parishioners (in the case of churches).”

Absolutely agree.

“There are other areas within government”

That is a deployment issue, not a tax issue. I agree with the sdentiment but think it should be a topic separate to taxation.

“Get rid of fees for higher education” certainly a highly desirable objective, although I think some “fee” is valid, if only to challenge the commitment of the student.

Ah billie – a potted biography of me, how sweet, not fully up to date.
Come around one day and I will give you the full, unabridged version, including my years in USA.

Re “Have you heard that Margaret Thatcher's son Mark has been implicated”

So you are suggesting the sins of the son should reflect on the character of the mother, billie?

Bob Hawke fathered a junkie.

should Ivan Milats mum be publically vilified because of her sons conduct?

Hitler persecuted the von Stauffenberg family for the participation of one of their members in the July 1944 assassination attempt.

You support a similar system of “guilt” by family association be applied to Margaret Thatcher?

Btw. “superannuation” contributions are not a tax. Funds are held in your name and for your exclusive benefit. They attract tax at a favourable rate to other forms of savings and your contributions taxed at a lower rate too. Well that is the present system, who knows what perversity the socialist swill budget will impose upon us all soon.

Fractelle, you poor pathetic loser

“One last item before I totally bail on this thread.”

Your emotional rambling and weasel words have underwhelmed us all and failed against the reasoning of my argument.
You run away and pretend you have made a stand; whilst what you have really done is inelegantly taken a squat on my doorstep and been hosed away.

“What you haven’t done is offer much at all (if anything) about sustainable living.”

Reading your posts, nor have you.

Most of your inane drivel has been a direct and deliberate attack on my right to post my view and to live my life as I see fit.

As in “Col (if you care to read his prolific postings on OLO) is always about justifying HIS choices, HIS lifestyle,”

Intellectual pygmies, like you, pretend your view on life and your values are the only ones which are of merit. You are wrong.

I can live my life perfectly well without you. You could die tomorrow and it would make no difference to me. However, your model of society needs people more innovative and creative than you to produce and create wealth, which you then tax.

Somehow, that equates you to a parasite and as such, you should be expelled from the body of society ( most commonly through the fundamental orifice).

Pelican, US view of “churn” is a good example of tax waste. Government taxing folk only to repay them the taxes as special allowance, like baby bonuses.

I disapprove of means testing. Both wealthy and modest incomed people are critical contributors to the social whole. They are deserving of respect for being the “net tax contributors” from whose effort allows government tax and subsidise the poorer ( “net tax beneficiaries”).

Fractelle has turned this into a “them and us”. I have tried to address the objective of this thread, a better tax system.

I do not have all the answers.
However, do have the “direction”.

I remain convinced, a better solution is to avoid the churn which US speaks of.

That means lower taxes and less government.

Red_Neck has failed to explain why the majority of Asutralian tax payers would be better off with a poll tax? Does Red_Neck want to follow the United States example and spend government budget money subsidising the large corporations that bankrolled the successful presidential campaign? Red_Neck fondness for laissez-faire economic policies are an indicator of sociopathic personaility disorders. Red_Neck has failed to explain why it is more efficient to pay for profit foriegn corporations to administer our health system ratehr than just funding hospitals and health staff wages directly? Why does he want to waste money overseeing every red cent spent rather than getting on with the task of providing the service?

Why doesn't someone who believes in smaller government just migrate to the home of the brave and land of the free. Oh, it was too tough so he came here.

Celivia “the very choice one person makes may restrict someone else’s choices”

That is an untested presumption which, even if it were to be true would not, necessarily be detrimental. It would all depend on whose “choice” reflected the greater merit and you and I know that is completely undeterminable and thus, presumptively unfair.

“less tax may mean “ well the problem is in the word “may” – less tax equally, may not especially if the philanthropic NGOs are better off because of greater direct contributions by those who might be paying less tax.

“But there are children involved.”

Ah yes, when reason fails, go for the emotions. Come on Cevelia, children, next it will be sick puppies and maybe baby harp seals or cattle, with big wet eyes.

“children that are born in disadvantaged, poor families.”

“Any society that does not offer affordable housing . . . and so on, is failing all the children who are living, through no fault of their own, in poverty.”

You are never, ever going to “cure” that problem, except by disqualifying people with insufficient means, either material or intellectual, from having children and, personally, I would consider such an action to be a violation of human rights, when government decides who can be a parent.

Bob Hawke “No child shall live in poverty….” And he was proved a liar.

“So, I am not convinced at all that total libertarianism is the answer”

But it is a better path to follow than total state control, which reduces “life” to mere existence.

“libertarian socialism,” is an oxymoron.

Like Lenin said “While the State exists, there can be no freedom. When there is freedom there will be no State.”

“We have no perfect political system- it does not exist.
We have to make-do with what we have and imperfect people will continue to improve on it.”

Now you are getting to my point, acknowledging the failings of people and political systems, my desire is to minimize the authority of politicians and the state and thus minimize the dangers of political imperfections blighting us all.

CR, sorry for the late reply, I’ve been busy.

My emotions are irrelevant- it is merely a fact that children born in poverty don’t have the opportunity to develop to their fullest potential UNLESS they have access to an effective welfare system.

I have no evidence that welfare systems work better for children or other vulnerable people in non- socialist-leaning countries that pay less tax.
I suppose NGOs ‘could’ provide welfare, but will they? There is no guarantee that there will be sufficient donations.
Besides, NGOs can be just as open to mismanagement and corruption as governments can be.

Countries with a strong, social welfare network in place simply do best.
“Netherlands tops UN child well-being table for rich countries; US, UK at bottom”
http://www.un.org/apps/news/story.asp?NewsID=21566&Cr=unicef&Cr1

One can’t argue that there is less personal freedom in a socialist-leaning country (no matter what Lenin said) than in a Libertarian one.
There is more freedom in the Netherlands than anywhere else in the world.
Legal and/or decriminalised are: soft drugs, same sex marriage with full adoption and IVF rights, voluntary euthanasia, abortion, prostitution …
And they have the lowest rate of teen pregnancies, heroin addicts and abortion in the world also.
This is what I mean by “libertarian socialism” - why can’t there be much personal freedom while a secure safety net exists?

Apart from empathy, look at child well-being from an economical perspective. Investing in the wellbeing of children today means reaping the benefits of that investment in the future.

That we haven’t “cured” child poverty doesn’t mean we can’t; it just means we have not bothered to prioritise it and squandered tax elsewhere (like useless wars on drugs).

So, YES to a smaller and smarter government but not to one that is only just adequate enough to protect libertarians and their properties.
A government needs to protect the basic living standard of every human being no matter how (un) able they are to provide for themselves.

What’s the point of a more libertarian-leaning country if that means more inequality and appalling (child) poverty numbers while personal freedom is not guaranteed?

Celevia “CR, sorry for the late reply, I’ve been busy.”

No apology required, I make no demands upon you, least of all your time : - )

Please do not presume that simply because I express a view regarding tax that such a view represents the sum of me.

This thread is about simplifying tax. It is not about the circumstances which prevail to force a child into a state of poverty.

I am the product of non-wealthy but loving parents. My daughters are the products of wealthier, loving parents.

Whilst I am materially better off than my parents, my true wealth is in the freedoms I enjoy, freedom to choose my work, freedom from the restrictions of a class based social order and freedom to indulge my love of art and music and friends in a way my parents could never afford.

No government will repair the deficiencies which negligent parents inflict upon their children.

Children, removed from their natural parents, even for their own protection, remain scared by the absence of those parents and no tax monies nor foster carers will ever heal that loss.

Similarly, no tax system will ever guarantee the “Hawke claim”.

Re “I have no evidence that welfare systems work better. . .”

Nor do I but I passionately believe people are naturally kind and generous and know best for themselves what they should do to help their neighbour in the spirit of philanthropy, charity and mostly compassion and a sense of “there by the grace of God go I”.

Conversely governments have no authority to address the individual needs of people. Government can only ever be, at best even handed and indifferent to the particulars to all and thus, cannot be compassionate or supportive in the loving sense an individual can.

That is why I prefer for us all the be free to be generous of spirit, rather than that spirit being taxed away and used, arbitrarily to employ bureaucrats to plan how some of that spirit will be distributed across the interests which politicians think will get them re-elected.

“One can’t argue that there is less personal freedom in a socialist-leaning country”

Disagree. The socialist heavy taxed regime deprives the individual of some portion of their private resources through that tax and thus denies the full freedom to spend as the individual sees fit.

Like wise, socialist countries tend to prefer state monopolies of education, health and other services (historically banking, airlines, telecoms, power utilities etc), through nationalized services, denying the individual freedom of choice or service provider.

“Legal and/or decriminalised are: soft drugs, same sex marriage with full adoption and IVF rights, voluntary euthanasia, abortion, prostitution …”

None of those have anything to do with “Tax”. They are all social policies some of which, as an individual I support and some of which I do not.

Empathy is not a socialist trait, it is a human trait.

I believe respecting someone sufficiently to be free to make up their own mind reflects significant empathy and you will know that, regardless of my gender, I have consistently respected women’s absolute, individual right to decide on the deployment of there own bodies.

In that “spirit of empathy”, I also respect peoples freedom to be the first beneficiaries of the fruits of their own efforts and own prudence and proberty in their financial affairs.

“That we haven’t “cured” child poverty doesn’t mean we can’t;”

Politics is said to be about the “Art of the Possible”

Whilst we should endeavour to try, I said before, I do not believe it can be cured in the absolute sense, simply because some people, through the chaotic influences of nuture and nature, possibly resulting in their own lack of empathy, just do not care but still manage to procreate.

“A government needs to protect the basic living standard of every human being”

Again, not possible, when some will prioritize drugs, alcohol and tobacco ahead of food and shelter.

“What’s the point of a more libertarian-leaning country if that means more inequality”

What point “equality” if it is bought at the price of individual rights, choices, freedoms, personal growth and aspirations?

"Pelican, taxing luxury goods is a bad idea once you consider the economic implications. It hurts the people who make the items far more than the people who consume." - freedivet

[1] What about coprious purchases? Did Alan Bond's purchase of "Irises" deprive Vicent Van Gogh from Joan Payson. Read Thorstein Veblen on the non-productive inflation of coprious purchases of the very rich. I not talking about a BMW or nice home of a middle-class Australian. It is phoney wealth of the High Society I am addressing.

[2] The Churches should taxed on non-charity assets. The Catholic Church helped via ethnic cleasing the Monarchs of France to kill the Jews, whom were the Crown's creditors. Good way to pay of your loans, if were not so serious.

[3] You have not completed you case on the "Evolution" topic.See you there soon.

[4] I think Gold is now taxed. Only recently it was not. Why not tax Lotto and Gabling. I know the risk of an underground.

[5] Why not tax Corporate Income at a low rate say 2% before operating costs are deducted. At least that way the Packers would something.

Cheers,

O.

" 'Using “taxes” to engineer a particular social outcome is the least efficient way of achieving such goals. Better alternative is direct legislative action and possibly, where a lot of problems do lay, better regulatory observation. "

This is not true, providing the tax is easy to apply. Compared to income tax and the myriad other taxes, there is very little paperwork involved in taxing emissions from a power station and petrol. If a tax is applicable, it is better for the economy than direct legislation, because it effectively removes the negative impact of taxation on the economy.

All taxes have a 'socoal engineering' impact. It is better to think about this impact and try to limit it to activities we want to restrict than to make taxation arbitrary (and then use other tools for social engineering on top of this).

The trick is to consider it from an economic perspective rather than a social engineering perspective. That is, rather than try to manipulate tax to get the type of society you want, limit it to those activities for which you can make a sound argument that a negative externality exists. Obviously, they should be revenue neutral rather than an additional tax burden. This will benefit both our economy and our society in general.

http://www.ozpolitic.com/green-tax-shift/green-tax-shift.html

Hi, CR
I find it hard to merely talk about simplifying tax because, I automatically anticipate the consequences any simplification or reduction in tax brings.
I look upon paying tax as buying services from the government. If we pay less tax, we receive fewer services.
We pay tax, and the government ‘should be’ at our service. I recognise that there are problems with a big government and squandering taxes.
That’s why I like the idea of tax shifting- if carbon is taxed, polluters will pay more tax and other taxes can be reduced.

“No government will repair the deficiencies which negligent parents inflict upon their children.”
It’s good to point out that the problem with negligence doesn’t have to be just a monetary problem. But while money can’t solve all child poverty problems, ensuring that all families have adequate housing and access to health care and education does solve a big part of the problem.

I do recognise problems with our government, but I anticipate even bigger problems when a corporate world would, more or less, run the country.
I hope that one day it will be possible for taxpayers to vote online on the main issues as they come up, which means the government can decrease in size and less tax will be wasted.
At least a government is democratically elected and is available for other purposes than to boost up the economy.

I would need a lot of faith to believe that corporations will be more ethical and accountable than democratically elected governments.
Private enterprise is about maximising profits- it is not elected by the citizens and not democratic.
What would stop it to exploit resources, people and the environment?

And how free would one actually be in the claws of a greedy, corporate world that cultivates our behaviour by manipulating emotions- a marketing society that makes us slaves of our passions and addictions?
I wonder whether Freedom doesn’t just rely on social policies more than on a little extra disposable income.

Continued

I DO love the things one can do with money and that money can increase options, but I wouldn’t want to exchange a reasonable welfare system that provides aid to those who need it for some extra disposable income.

To say that riches are the way to freedom is something that marketing spruikers want us to believe.
Who knows, perhaps Janis Joplin was right and “Freedom is just another word for ‘nothing left to lose’. ”
Perhaps the Buddhists are right and freedom may mean non-attachment to the material world including people.
Freedom is such a multi-facetted concept and may be personal.

I have no faith in modern consumer capitalism as a provider of freedom.
It encourages conformity and one-dimensionality, and an intolerance of those who wish to break out of the expressions of individuality manufactured by the market.
The boy who is isolated from a group because he doesn’t wear the latest style Reeboks.

“I passionately believe people are naturally kind and generous “
That’s a really lovely idea, and I agree that people are naturally good.
But don’t you think that, no matter how good people are, it depends much on the economy whether people can afford donations?
For example, even when we pay less tax, interest rises may still hold people back from being as generous as their nature allows them to be. People are struggling with angst about the financial future as well.

I think that for me the time has come to move on and to agree with you on some of your points such as increase personal tax thresholds and reduce world population and disagree with other points.
You’re welcome to have the last word, Col, because I don’t think I have any new points regarding taxes for now.

This discussion has provided me with some new thoughts and interest, so I wish to thank Pelican for providing this interesting thread and all other contributors for making this an enjoyable discussion.

Cevelia “I look upon paying tax as buying services from the government.”

It could be looked upon as that. However, I dislike taking a market full of consumers and vendors and replacing all the vendors with a single monopoly vendor. It is the very basis of bad commerce. It destroys the benefits and efficiencies of competitive supply.

The notion of tax shifting was seen with the introduction of GST, shift from sales tax, stamp duty, land tax onto GST, except the lying bastards in the states did not remove all the taxes they were supposed to. They will do the same if you think about carbon tax too.

“ensuring that all families have adequate housing and access to health care and education does solve a big part of the problem.

Cannot be done due to the reasons previously stated, not all people act either in their own best interests or with responsibility for their children. Every person has to accept some self responsibility, global safety nets are subject to significant diminishing returns. They are also a disincentive to people, who may accept lower standards to qualify for handouts and doing nothing.

“a corporate world would, more or less, run the country.”

Corporations do not vote, only people vote and powerful government is capable of behaving with all the negative characteristics of corporations anyway.

“Private enterprise is about maximising profits”

No, private enterprise is about ensuring the business is there for tomorrow and the day after, not just for the profits of today. That is the old socialist excuse for nationalisation and it is a lie.

“What would stop it to exploit resources, people and the environment?”

Well protective legislation will do a lot more than simply playing with taxes.

“And how free would one actually be in the claws of a greedy, corporate world”

Corporations are run and owned by people. They are the conduit for collecting sufficient equity to enable the risk venture to be financed. They are heavily legislated and corrupt practices are legislated against as they are revealed ( example: Sarbanes Oxley in response to Enron)

“but I wouldn’t want to exchange a reasonable welfare system that provides aid to those who need it for some extra disposable income.”

I have not suggested removing all welfare. I do believe a balance does need to be made between, on the one side

Individual incentive and opportunity (including the opportunity to express compassion and philanthropy)

versus

the costs of a welfare safety net.

I repeat, safety nets are seriously subject to diminishing returns and need to be set to the bare poverty level or they will attract the lazy opportunists who would rather do nothing than work to improve their own circumstances.

“I have no faith in modern consumer capitalism as a provider of freedom.
It encourages conformity and one-dimensionality, and an intolerance of those who wish to break out of the expressions of individuality manufactured by the market.
The boy who is isolated from a group because he doesn’t wear the latest style Reeboks.”

So your solution – they are only allowed to wear same coloured uniforms?

Where is the “expressions of individuality” in that?

Consumer capitalism leaves the choice with the individual to buy or not to buy and what fashion statement to make be it conservative, punk, contemporary etc. etc. (actually if I were younger I could definitely see me in goth garb).

“it depends much on the economy whether people can afford donations?”
and the less you tax them the more they have to donate.

I see no merit in simply being the last to post.

I do see merit in challenging ideas and having to defend and thus analyse and clarify, for myself, my ideas too.

The matter of tax is an enabling matter.

Tax is not a system for punishing the wealthy or to redistribute wealth.

Nor is it there to buy a safety net, intended to protect people from their own stupidity.

Tax is needed to fund the necessary work of government and our desire for efficient government would suggest it should be, overall minimised, to keep government “lean”.