Just one working day after the NSW State election, one of my least favorite politicians 'Cocky' Joe Hockey seen fit to finally release the Treasury discussion paper on tax, the paper advocates broadening the GST, and reducing income and company taxes. Hockey makes the point that the top 2 per cent of income earners paying 26 per cent of the income tax bill and 12 companies paying a third of all company taxes, Obviously Hockey is sympathetic towards reducing these peoples tax burden, if you can call it a burden.
With the government’s poor economic management seeing an overall reduction in tax revenue, Abbott and Hockey need new sources of finance. Given this governments philological commitment to support the rich in society it is only natural they would wish to transfer the tax burden to the financially poor. This transference would easily be achieved by firstly making the GST all encompassing, and secondly increasing the rate to say 15%. Like so many reforms this government advocates, tax reform would simply see the burden transferred from the rich elite in our society to those who can least afford it, the economically disadvantaged, in other words, the poor.

"Given this governments philological commitment to support the rich in society it is only natural they would wish to transfer the tax burden to the financially poor." - Paul1405

I think you are wrong in pointing/giving the finger to Joe Hockey.

There is nothing new in your statement. All Governments essentially tax the hell out of the poor and favour the rich. Your beloved Labor Party didn't do anything to improve the poor people's tax burden during the nine years they were in power. Okay I stand corrected, they did give everyone $900 whilst in the process of spending all of the budget surplus money like it wasn't their own.

The tax situation does need discussing so a we are able to continue paying for the services and benefits we currently enjoy well into the future. An equitable tax system needs to be developed bi-partisan so both the major parties have equal responsibility with no excuses for blaming each other during the elections. People may also need to accept that money doesn't grow on trees. Many who complain the loudest don't actually earn enough that tax deductions are actually significant burden on them.

My understanding of Hockey's announcement is they are looking at the options and seeking Labor's input. Correct me if I'm wrong but didn't Big Joe call the top corporate companies that are dodging taxes via the legal loopholes - Tax Thieves?* That suggests to me he is planning some the changes we want to see for the corporates and the top income brackets.

*note: an ABC commentator yesterday critiscised Joe's "Tax Thieves" comment as inappropriate because if the corporates are using legal means to minimise their taxes, they are not stealing.

Paul,

http://www.smh.com.au/federal-politics/political-news/big-business-took-25-billion-in-tax-relief-in-2014-tax-office-figures-show-20150401-1mbnuh.html.html

Big business took $25 billion in tax relief in 2014, Tax Office figures show

"Australia's biggest 900 companies claimed tax deductions and exemptions worth a total $25 billion last year – enough to wipe out two-thirds of the current federal budget deficit at a stroke.

As Treasurer Joe Hockey prompted a national "conversation" about tax reform, including the prospect of a higher and broader GST, the Australian Tax Office's own data showed the top 900 companies paid an "effective tax rate" of just 19.3 cents in the dollar on pre-tax profits in 2014.

The corporate tax rate is 30 per cent.

Companies now pay proportionately less tax on their income than the average wage-earning Australian.

Mr Hockey and Treasury have flagged a tax cut for business to boost international competitiveness but the Tax Office's numbers show that, on average, Australia's biggest companies are already paying less than Britain's statutory rate of 21 per cent after they have taken a range of concessions and write-offs.

Once loss-making companies, which pay no tax, are excluded the effective tax rate paid by Australia's top 900 companies is about 21 per cent."

Definitely room for improvement.

Hip, get it straight I don't vote Labor! Yes 'Cocky' Joe did pontificate about the corporate tax thieves, but do you really expect him, considering they are his biggest backers, to do anything about them. What does your party in power intend to do about the $7 ripped of by business from the GST each year? The cash economy is thriving, no tax being paid! What does your party in power intend to do about multinational companies and their off shore tax avoidance schemes?
Poirot, good point $25 billion being ripped off by big corporations. We don't have an expenditure problem in this country, we have an income problem. Business tax thieves need to be delft with, and not simply talked about by their favorite sons Abbott and Hockey!
At the end of the day Big Business will simply tell Abbott and Hockey , "if you've got a tax problem, simply hike the GST and keep out of our play pen, or there'll be no bikkies for you!" Otherwise Joe's North Sydney Forum would run dry.

....Big business took $25 billion in tax relief in 2014, Tax Office figures show

Yes Poirot, but they also accounted for some 74% of our tax revenue so I would suggest you cant have it both ways.

I would like to see the numbers on just how much in taxes these big companies raise/generate, both directly and indirectly because pretty much every job is in some way created by big business.

As for the $25 billion in write offs, what's the difference between their LEGAL write offs and say a regular PAYG income earner claiming say union fees as a tax deduction. If you remove the zeros from the equation you get the exact same result, tax deductions.

I just don't think people place enough importance on our reliance on big business because 7 out of every 10 rely on them for financial support. Do we really want to loose that support.

Big business is here because they choose to, not because they have to and, if we keep pushing and pushing, chances are they may well follow the car industries and leave. Then what!

Won't be long before the states, seeking to make up shortfalls in federal government spending, will push for more GST.

When it rises to 15%, say, and applies more extensively to food, those ticking or recently ticked into retirement will have lived under a high income tax regime whilst putting money into super, only to keep paying out after retirement. The 5% extra (difference between 10% and 15%) will be the same as the fed taking 5% of every nest-egg. The self-funded will be paying for those who aren't because they wouldn't, or couldn't.

If Labor did this LNP/Rupert would have a field day, as when Labor mooted a deposit tax and a claw-back of some of Peter Costelloe's superannuation largesse towards the rich. But it's all OK now, right, not a peep from Rupert?

OAM, if negative gearing on rental property is removed, shouldn't it be removed from all classes of assets that earn income? Would that bring down share prices, for instance, making them more affordable for struggling young families seeking to buy their first shares?

In order to keep a level investment playing field, the same NG gearing regime should apply to all asset classes. If it doesn't, there will be no private investment in housing, leaving rents on existing stock to rise, and reliance on government to provide.

There is a lot to think through.