I believe that our GST taxation system is totally dysfunctional; no one understands it, not even the tax department.

The whole system of taxation in Australia, in my opinion, needs to be rebuilt from scratch. There has never been any public debate on alternative taxation systems that included all possible options. The last debate from my recollection only debated about GST.

I believe a fairer and simpler system is a Debit Tax. This system could be implemented easily through the nations ATM’s and tax deposited each day automatically to the Federal Government. There would be no need for tax returns. No need for a Taxation Department as such, or only a small department. No need to HAVE to employ Accountants to do our tax returns. It is easy to comply with and everyone would be happy to pay their fair share. That is except very big business and multinationals, who at present I believe pay very little or no tax, they use our resources, and take most of their profits out of the country.

This system can be looked at on the following web sites.

http://www.nutech2000.com/webtext/upaussie/dtaxconcept.html

http://home.overflow.net.au/~nedwood/gst.html

http://www.johnston-independent.com/debit_tax.html

http://www.snakeshow.net/default.html?social_tax_debit.html~mainFrame

I believe the basic structure of a Debit Tax System is fine, with maybe some fine tuning.

I ask our political leaders or potential leaders to seriously look at this system, have a public debate about it and/or some other system that may be equally simple and functional.

What are others thoughts on this system?

attaboy.

a rational and just democracy would finance itself just as you describe. unfortunately, we don't live in one. the standard of discussion i have found here suggests we aren't about to change any time soon, either.

the politicians guild would wither and die if they could not reward supporters with preferential tax treatment. they understand this just as a bird understands gravity. that is why the gst was levied on top of variable taxation, rather than replacing it totally.

no chance,mate. but it was nice to see someone willing to step off the beaten path for a change.

PEOPLE POWER you so far out of the paddock you may as just well be in another overseas country. What you have failed to realise is that the income tax (your money) you believe, and the Tax Commissioner claims you have an obligation to pay, is that the obligation only exists because you entered into a lawfully binding agreement with the Tax Commissioner and agreed to pay what ever Michael D'Ascenzo or is delegates in the TAX OFFICE deem appropriate. It was a voluntary obligation prior to that agreement but you can cease the agreement by instructing the Tax Commissioner not to use, provide to third-parties, store or maintain a record of your TFN for the purposes of identification, even for taxation purposes or he is committing an offence under sec 8WB of the Taxation Administration Act 1953.
This agreement commenced when you applied for a Tax File Number for the purpose of paying taxation and that is when your voluntary obligation ended and your legally binding obligation commenced. Since then the terms and conditions of the contract have changed many times and did you object, no, you did not write to the Commissioner and object in writing or serve notice of your objection on your Parliamentary representative elected in the elections you voted in as an ELECTOR, you acquiesced (implied consent) and you now are a party to a lawfully binding contract or agreement that created this obligation and the pretend courts will make sure that you pay

Not a bad idea. It would need to be marginal based on volumes in a particular month, or would penalise low income earners. Our marginal system is designed to get a higher contribution from those that earn more, and I can see the merit in that. Also your system would be great in a cashless society, but cash still talks quite loudly (particularly given the GST).

Yes, the GST should just be on everything and it would be much more workable. You could cut the income tax rates for low earners to help offset the additional cost that this would impose on food etc. I'm a tax accountant, and I think its far too complicated, so what about the average Joe.

Young Dan, you're a bit mistaken. Yes, you dont have to apply for a TFN, but if you dont supply one to your employer, they must withhold the top marginal rate of tax (currently 46.5% inc medicare). Given that most people are on either a 15% or 30% tax rate, then you suffer unnecessarily by NOT having a TFN. Similarly if you supply goods or services to a business without giving them an ABN (which you cant get without a TFN), they have to withhold 46.5% of your payment. There are plenty of safeguards built into the system to make sure the govt gets their cut (or more).

Country Gal, Its already been done and there is no way around it as the Commissioner and any employer also has to comply with the rule of law and that appears to be something you have no understanding of. If you wish to make these statements about what the employers statutory obligations now you can provide the statutory basis for these statements or forever keep your mouth shut as any attempt to track them down will be very disappointing. If and when I choose to work I do it as a self employed individual and not as a statutory slave like you and the people who provide me with employment pay 100% or the work is not commenced.
The previous Tax Commissioner discovered this the hard way and was summoned to appear before one of Her Majesty's Courts in Qld and as you are fully aware he has now been moved sideways to some other position in bureaucracy.
I am also aware that an attempt to introduce a Bill into the Federal Parliament was being made to remove liability from the Tax Commissioner personally and place it in the lap of an entity that does not even exist. I would not expect much better for an accountant as your very existence relies on the legal theft of property from individuals who do have rights to property as well as life but as you would claim to be university educated you would have to know it all or so you believe.

Dan, it took about 4 1/2 minutes to turn up the statutory items that you claim do not exist (note for the future - dont debate tax law with someone who's home page is the tax office website).

The withholding tax rules are contained in the Taxation Administration Act 1953. There is a schedule of payments that may require withholding by payers in s10-5.

s12-35 is the requirement of employers to withhold from payments to employees.

s12-190 is the requirement of businesses to withhold from payments to other businesses that do not quote an ABN.

The power to requirement lodgement of income tax returns in contained in the Income Tax Assessment Act 1936 (ITAA1936), in s161(1). This gives the Commissioner power to issue an annual legislative isntrument (which has the force of law) to require that certain people lodge an income tax return for that financial year, by a certain date. Individuals who earn more than $6000 per year are required by this law to lodge an income tax return. Remember all those court cases going back abtou 5 years where a heap of lawyers were sent bankrupt because the Commissioner found out they hadnt lodged tax returns for more than 30 years, and issued assessments for those years? There is your proof that this law is held up by the courts. Fail to lodge at your own peril.

I dont like paying tax anymore than the next person, but its a necessary evil. Funds are needed to run our public infrastructure and services, and they have to come from somewhere. If you deliberately dont pay tax, then stay the hell off our public roads, transport, dont use the public hospitals, dont claim a medicare rebate, never call on the police, dont watch the ABC and DONT claim welfare payments.

Dan you also need to realise that an accountants job is only minimally about compliance with taxation laws (although there has certainly been a heavier burden since the introduction of GST). We advise people of business structuring (for both tax and asset protection), advise on business performance and ways to increase this and monitor the results of change programs put in place. We act as succession planners in family businesses. We advise on superannuation. There are all manners of things that a general accountant does, that are not related to tax, or have little relation to tax.

As far as tax goes, our job is to ensure that our clients pay no more tax than they legally have to, and to help plan ways to legally reduce tax. Eg whether a business asset sale is eligible for the small business CGT concessions. Our tax laws are extremely complex and convoluted and our job is to help people navigate that maze. As for depending on the system for our livelihood - negative! If all of our compliance work were removed tomorrow, we would still have enough general work for all accountants currently in the industry. It would actually free us up to do work that is far more productive and rewarding (few accountants like compliance work, and it is rarely enjoyable).

As for having a uni degree, yes I do. Have you got a chip on your shoulder because you dont?? Uni (or any other form of education) is no indicator of ability or intelligence (although sometimes grades can be). My father is one of the cleverest people I know and he only went to primary school for 2 years by distance ed. Big whoop. He has done just fine without uni. The only reason I need it was to get my professional qualifications. I now have a very expensive piece of paper that hangs on the wall and does nothing.

Totally agree.I would mind if the states spent it responsibly and decreased other taxes as promised but they just waste it and grow their bureaucracies.It has be made simpler.

The time it took you indicates that you have been totally indoctrinated as you fail to understand that you have only quoted the RULES to a civil contract of which requires the consent of both parties. You don’t appear to understand the difference between MAY and MUST as they require consent before they MAY require certain people to do anything.
The exercise of power by the Commissioner is only authorised with the other party's consent but this is only obtained by fraud as the commissioner relies on an individuals implied-consent or their acquiescence.
I don’t remember any of those alleged court cases and I will bet you are not aware of the citation numbers or what the arguments were that were presented to the pretend-courts by the defendant bottom-feeders. Were these matters dealt with in administrative hearings due to the implied consent of the defendants or in a properly constituted Court of Law compatible with Chapter 111 of the Aust Constitution with the SEAL of the COURT displayed on the face of the documents FILED by the Commissioner in the Registry of the Court as the copy of the originating process I have before me is not sealed with the seal of the Qld District Court but it does display the Registry stamp required under rule 978 but not the SEAL of the COURT required under rule 968.(3) & 969 (4) of the UCPR of the Queensland Supreme Court ?
Why did you not mention the Commissioner's latest complaints about 31 judges and 187 barristers not fulfilling their voluntary tax obligations ?
If you believe you should fund these vile thieving evil grubs who are paying themselves a $400,000 plus graft and tips, you go right ahead.
As for, there is your proof, I suggest that you read and understand the Commonwealth Evidence Act.
You just don’t get it do you I have not lodged anything for seven years and I don’t claim anything from any of your vile grubby mates in bureaucracy and the last people I would rely on for assistance are the very filth you have identified

cgal, are you sure arguing with youngdan can be productive?

on a more constructive note, the point of 'debit tax' (i prefer 'citizen subscription', as all taxation is selective looting) is to make the tax office obsolete.

variable taxation is unjust, and meant to be unjust.

DEMOS, you make a good point on more than one count. I think I will ignore Dans rantings - it just irks me that at a minimum he will be getting to his work on public roads that he should be helping to pay for.

Yes making the ATO obselete (or largely so), would be a massive saving in itself. A debits tax would also make it difficult for tax avoidance (but then provides a very big incentive for the further development of the cash society). It simplfies the tax system enormously. I still think that people with monthly debits of less than certain amounts should be exempt - otherwise you punish low-income earners (the same way that GST does and why they exempted food items).

I do see the merits in a tiered taxation system like we have, but also understand why so many struggle with it and dislike it too. The broadening of the tax brackets and the raising of the top tax bracket from $50,000 to $180,000 in the last 10 years has gone a long way towards reducing the effects of bracket creep and removing some of the disincentives to earn extra.

On further reflection, what are your thoughts on the potential of a debits tax for double-taxation?

Eg a company pays its employees, and has to pay debits tax on these payments. The employees then have to pay debits tax when they withdraw their wages.

There is also an incentive for companies to further boost profits and cut spending (less spending = less tax). Further incentive to cut jobs (less tax). Which I think is part of the justification for taxing of profits.

Our current system also helps to avoid double-taxation. An employer doesnt pay tax on the wages it pays. The only taxing point is in the hands of the employees (the employer on the other hand pays tax on its profits). Also in a company situation, the company pays tax on its profits, then when dividends are paid to shareholders, a tax credit comes attached with it. The only additional tax to pay is the difference between the 30% corporate rate and the individuals marginal rate. It makes the system more complex, but fairer too. Its hard to get a system that is both fair and simple.

cgal, i take the view that whenever money changes hands, the payor gets a 'good' from society, and should subsidize the society that makes the transaction possible. i think impartial justice requires that every transaction be treated the same, so always x% clipped off the price into the social treasury, no favorites.

so the widow buys a loaf of bread for a dollar, 10 cents goes in the treasury, the media magnate buys a tele station for a billion, one hundred million goes in the treasury.

if you want to subsidize some people who cannot support them selves- do so. give them a wage for being alive. don't mix charity and functional transactions- it corrupts both.

best of all, no more tax bureaucracy, vastly fewer lawyers and accountants- business will flourish, and national leaders will have to manage and/or plan well, having no means to bribe their way to power.

I note that COUNTY GAL failed to respond to any of the particular issues I raised or defend the vile offensive conduct ( crimes) identified but there are many people who are perusing precisely these matters in the appropriate jurisdiction. If that fails then the general public will have to rely on the procedure spoken about in the High Court case Kable v The DPP NSW in paragraph 11 by Judge Dawson.

This Court observed, that view was rejected by Lord Reid in Pickin v British Railways Board (47). There he said: "The idea that a court is entitled to disregard a provision in an Act of Parliament on any ground must seem strange and startling to anyone with any knowledge of the history and law of our constitution ...
I must make it plain that there has been no attempt to question the general supremacy of Parliament. In earlier times many learned lawyers seem to have believed that an Act of Parliament could be disregarded in so far as it was contrary to the law of God or the law of nature or natural justice, but since the supremacy of Parliament was finally demonstrated by the REVOLUTION of 1688 any such idea has become obsolete."

The problem is not that the courts fails to take notice of the Parliament's requirements, it is the individuals, who are appointed as judges and judicial officers that refuse to provide the court of law which are compatible with Chapter 111 of the Australian Constitution. These judicial grubs are the criminals responsible for the failure to up hold our rights provided by the Parliament and hear all matters in dispute in these administrate hearings ( tribunals) surreptitiously created without our knowledge or our express consent.
DEMOS you are correct as it has not been too productive at all for the COUNTRY GAL.

DEMOS, perhaps the problem identified would be able to be addressed by re-writing the welfare system at the same time.

That said, dont hold your breath. They tried a re-write of the basic income tax act (although the basic is a misnomer) in 1997, but never finished the job, as we now have two concurrent income tax acts (1936 and 1997) just to confuse the situation even further. The big hoo-haa that was made after the 2006 budget about the deletion of several pages of the tax act only removed provisions that were out of date and had no further operation.

I am all for big taxation reform (apart from the prospect of losing my job), as the current system is far too complex and simplifaction attempts have done anything but. On a daily basis I stand to be sued for a misinterpretation (even where the law is ambiguous to start with), so removing the complexities is good for me. I have been very seriously considering a career change anyway in light of some of the things that accountants get sued for (and lose)!!

CountryGal. It is obvious that the bit of paper on the wall means absolutely nothing as you said and it does appear now that you were taking money off your clients under false pretences as you are not up to the task of answering my criticism and now you are looking to get out of the money stealing industry. I have no pieces of paper providing my clients with any false impressions of what I may be capable of and I don’t need any of this fraudulent rubbish that all of you so called university educated professionals just love to hang your hat on. Go and get yourself a real job or are they only reserved for the uneducated slaves that you bleed off. As for being sued in the pretend courts I would prefer that you got jailed for the money stealing scams that you are involved in with the parasites in the ATO.

We do remain one of the highest taxed nations on earth today and it is not going to improve anytime soon.

We in One Nation have been saying for ten years that the "Transaction Tax" (debit tax) was our only answer. We were attacked by just about everyone. Costello said we were mad!

I noted a comment that said "paying tax was a necessary evil, and that everyone had to pay" ( for our infrastructure) well, every one does not pay! Multi National foreign owned corporations are stealing billions of dollars from this nation annually. "The double tax agreement" only thing is that our nation is the only nation in the world partaking on this mad out of control system. 10% of the wealth of this nation is currently paying 90% of the tax bill, that's us! 90% of the wealth in this nation are currently paying 10% of the tax bill, that's the foreign owned corporations and the wealthy!

The other thing is, haven't you noticed that every government agency now has a "user pays" system! So where the bloody hell is all of our tax dollars really going? And accountants, suddenly very wealthy, mine has a million dollar mansion, and a new industry hatched overnight. 1st. July 2000. Why does small business have to carry out government tax collecting and pay these acountants $100 dollars an hour. There is absolutely no equity in this outrageous sytem

We have politicians that blatantly lie daily about this. Do you remember Howard saying on the introduction of the GST we would be paying 30% income tax, and all other taxes would be abolished? What garbage!

We know that our net disposable income from total tax receipts would more than double (our regressive current system) if we adopted a "transaction tax", forthwith. The mechanics would not be difficult to set up.

We have researched this for years, and eventually worked with the "Taxation Council of Australia"

Go and have a look at our website: http://www.onenation.com.au and check out our policies.

Ian J Nelson State Director One Nation Qld. Division

A debit tax is a really bad idea. It is easy to avoid because it is a tax on one system of transferring money. People will just switch to other systems.

This is a much better idea:

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

A debit tax system is not that different to a GST system, except that there are no exemptions, AND the taxing point is not deferred to the point of ultimate consumption. In effect, you get a tax on a tax on a tax by the time you buy an end product that has been through a few different hands on the way to you. In addition, you penalise indutries that work on tight margins, and reward those that have healthly profit margins. So, the more I think about it, the less I like it. Added to it as freediver mentioned, the ability to levy debits tax depends on the use of a particular transaction system, and alternate systems (eg cash) can be used to avoid the tax.

Perhaps if we simply removed employment taxes (income tax for employees and payroll tax), and levied the tax on the business-owners instead. YOu wouldnt get wages growth for some time, but you wouldnt need it. Businesses usually need to get financial statements prepared for their investors and bankers anyway, and doing a tax return isnt that much more work on top of it. It would remove avoidance and compliance for workers, and not add unreasonably to the compliance requirements for businesses anyway. You would probably need to work in some way for a wage reduction to start with to even the burden up (but you'd get more money in your pocket anyway).

Dan, I havent responded to your silliness because I am not a legal expert. You can carry on about mock-courts all you like - I have enough problems in the taxation system to get my head around. Cant tackle the legal system as well. If you want to argue about the court system, find a lawyer to argue with.

What I initially pointed you to was legislation, not anything to do with the courts (except enforceable by them).

I am very sorry that you have such a severe inferiority complex. As I said, as piece of paper on the wall doesnt mean much, but you seem to have a problem with people that are required to get that bit of paper to work in the area that they want to. Yes it pays reasonably well, although not for some time. Accounting graduates are the LOWEST paid graduates in any professional discipline. There is light at the end of the tunnel, but its a long way down the career path, and requires a lot of hard work to get there. I am paid quite well based on my age and experience, but I still makes less than either of my sisters, one a pharmacist and the other a truck driver (and both younger than I am). And my brother-in-law who is a heavy vehicle diesel mechanic makes 60% more than I do. Does that help to put things in perspective a little?

As I mentioned in an earlier post, I'd be more than happy if the tax system was reformed so that I didnt have a job any more. I am quite capable of retraining quickly, and the skills that I have learned in my job (did I mention that tax was a very small part of it anyway), can be used in many other fields. Most accountants would be in the same boat.