Forgive my spelling, new computor [recently] and spellcheck not working hints? no PC genieus
Capitalism, seems the only system that works
It needs growth in population profits productivity
Can we, surely we must, change it to produce a better world
Must we forever rush headlong in to a day no more growth is possible
Are producing a world that in the end serves only some humans? your thoughts pleas

No-one should be allowed to make more than 10% pure profit !

Belly,
I find labels such as "capitalism" unhelpful because they cover a very broad range of desirable and undesirable features. So if you think it's the only system that works, please list what you think are its defining features and we can discuss whether changing those would enhance, weaken or destroy its effectiveness (or even make it effective in ways it currently isn't).

>It needs growth in population profits productivity
Actually it doesn't. It works whether population is growing, steady or declining.
I'd argue it can work even when profits aren't growing.

Whether it requires growth in productivity is a moot point, because (as a trend) productivity has always been growing and always will grow. But theoretically I don't think it does, as there's always scope for competition. Even if there's no overall growth, some businesses can make profits at the expense of their competitor's profits.

>Can we, surely we must, change it to produce a better world
There are many things we should change to produce a better world. Most (possibly all) of them have economic implications, but I'd regard the changes as policy rather than systemic.

>Must we forever rush headlong in to a day no more growth is possible
Those who think growth could become impossible generally don't understand what growth actually is. Value can still grow when resource use is declining.

Or are you referring to an outcome when environmental catastrophe wipes out all the growth?

>Are producing a world that in the end serves only some humans?
No, but some are served a lot more than others. Again it's a matter of policy.

__________________________________________________________________________________

individual,
>No-one should be allowed to make more than 10% pure profit !
Why should it be disallowed?
Who should disallow it?
How should it be disallowed?
10% of what?
What makes profit pure?

That indy is enforced socialism
Here is what I have in mind
Tax 20 percent for wage earners
22 percent for all else business Churches every one
No loopholes paid on every cent earned always
Hopefully more than one country would agree to start this off.
Tax havens considered a criminal activity
No trade with any country offering tax free zone, and the firm/person accepting it, seen to be an international crime
Extra Tax paid far out weights the lower rates
No trade no entry to our country for anyone not paying tax or involved in any avoidance
ps, new computer not able to run spell check properly yet please forgive

Aidan,
Who said profit is pure ? Pure profit means the profit that is after all expenses have been covered including wages.
We should have a set general wage amount & if those who want more can work extra as much as they like but as Belly says, no loopholes such as negative gearing or tax bracketing.
That would make us an enviable society within a very short time. the same tax on everything & not like 70% on fuel/cigarettes etc. Every article sold attracts 10% full stop. Inheritance included.

Dear Belly,

Our economy is controlled primarily by the market.
Capital goods are owned by and large by private
individuals and businesses, rather than by the
state. While the government does enforce regulations on
various industries - we do have a very effective
capitalist economy which remains one of the least
regulated economies in the modern capitalist world
letting the forces of the market drive our economy.

We're seen as being one of the most successful capitalist
nations in the world. I would really prefer this not to
change.

Belly,
Supposing a country got all the revenue it needed from land tax, why should it be obliged to tax profits as well?

And your plan seems to involve businesses paying taxes on their costs as well as their profits, which would greatly harm our competitiveness.
_____________________________________________________________________________________

individual,
>Who said profit is pure ?
That'd be you!
Of course you didn't say ALL profit is pure, but nor did I.

And I notice you've conveniently avoided my first question: 10% of what?

>Pure profit means the profit that is after all expenses have been covered including wages.
>We should have a set general wage amount & if those who want more can work extra as much
>as they like but as Belly says, no loopholes such as negative gearing or tax bracketing.
Looks like you haven't considered the devastating effect on small business.

>That would make us an enviable society within a very short time. the same tax on everything & not
>like 70% on fuel/cigarettes etc. Every article sold attracts 10% full stop. Inheritance included.
So you'd be happy to effectively encourage teens to smoke? And do nothing to deter and recover the cost of air pollution?

Aidan,
too bad you don't click !

http://en.wikipedia.org/wiki/Capitalism

http://en.wikipedia.org/wiki/Natural_law

Capitalism is a form of Universal Natural Law and can lead to Globalism- it puts decisions under control of the financial markets. The financial markets are a powerful way to manage some complex problems- I can see in some circumstances they could be used more- but they are a tool- whether a tool is useful depends on what one wants to achieve. As our societies change we need to use tools to manage the societies- sometimes we need to invent new ones or preferably use old tools in new ways. I believe that universalism will lead to inequality and tyranny especially when it is implemented on a global scale- despite Locke's intentions. Locke apparently saw governing as being like organised crime or oligarchy (probably based on Aristotle's Politics) and felt that universalist Liberal Democracy was a way of avoiding this trap- Patrick Deneen/ Alexis de Tocqueville's contention is that Liberal Democracy ends up the same way though at a larger scale. Patrick Deneen says that it was Locke's intention with Liberalism Economic (Capitalism) and Social Liberalism is to create universal conditions to enable humanity to be "free of government". A large effort would be required to create these conditions but less effort to maintain it. But Liberal Democracy is in fact more overbearing than intended- constant corrections need to be made to the system to make it function.

Adam Smith talked of the unseen hand- universalist economics- but he was appalled at stock piling and price gouging of tobacco before and during the US War Of Independence.

Globalisation seems to contradict the principles of the UN principle of self determination (ironically the UN seems to be pushing globalization), and the US Declaration of Independence- Government of the people (though ironically inspired by Locke). At some stage there is always a compromise of principles- myself I favour self determination over universalism.

In the practical art of war, the best thing of all is to take the enemy's country whole and intact; to shatter and destroy it is not so good. So, too, it is better to recapture an army entire than to destroy it, to capture a regiment, a detachment or a company entire than to destroy them. Sun Tzu- Art of War

The way I interpret this is- forming a team or an organisation is a difficult task taking lots of resources- this team can be applied to tasks and achieve goals. It's important not to waste this resource without reason. Nations are similar engines of productivity in the service of their cultures. Why would someone want to change the culture of a nation by force.

Hey individual,
"No-one should be allowed to make more than 10% pure profit".
Well it wouldn't be capitalism then.
Not sure what I'd be, but it wouldn't be Capitalism.

You've got to see both sides;
You might think it unfair that some charge a huge markup;
(And I know that prices these days often raise an eyebrow)
But know that under Capitalism, you have the opportunity to not only be a retail customer but a business owner yourself.

If you can identify areas or items with large markup and little competition you too could start a business with lower profit margins and better value for customers.

It's my belief that if you 'provide a good quality product' at a 'value for money' price, then your product should sell itself.

There are some problems, and flaws that I can see with your idea though.
[FYI I actually thought of the same thing once, only I was thinking Cost + 20%]

It's flawed because it does not allow for 'supply and demand' to itself determine the products value.

Say you buy 200 mobile phones and begin selling at cost + 10.
What happens if a mobile phone competitor brings out a better model cheaper and then your items aren't selling?
What happens when a new model of phone supersedes the stock you currently have?
Do you sell at less than 'Cost + 10' to get rid of the old stock;
Are you happy to sell at a potential loss;
or do you be prideful and not sell at all?

If you can provide me a better price on items I WANT with the same level of service I'm used to getting:
- Then you've got my money, I'll buy from you -

Hey Belly, Aiden and Foxy,
Belly Quote>>It needs growth in population profits productivity<<

Aiden Quote>>Actually it doesn't. It works whether population is growing, steady or declining.
I'd argue it can work even when profits aren't growing.<<

- I think Capitalism and Servicing National Debt are two different things.

Capitalism can work whether population is growing, steady or declining;
But historically no nation has come back from a fertility rate less than 1.8
Servicing National debt however does require growth I believe, because money is lent into existence (with interest due) instead of being spent into existence by the government.

Foxy Quote>>Our economy is controlled primarily by the market.<<
I'm not sure that's exactly true, for the same reason Aiden mentioned.

Reserve Banks can manipulate the market by modifying the interest rate to slow or stimulate lending and spending, which affects the amount of new constructions and the employment they require, and underpins the economy so it's not really the market determining prices any more than the cost of buying money (borrowing)

Hey Individual,
"Inheritance included."
I don't think inheritances should be taxed.
I see it as government double dipping on the basis that WHEN that money was earned by your relative or what-have-you THEY ALREADY PAID TAX on those earnings.
If the government takes a share, they're effectively taxing your dead relative a second time as the price of their dying.

I intend to stay on course, that is highlight my views on *new capitalism*
But after setting those views out highlight the benefits to humanity
Next part of my tax plan is remove all other taxes on every thing every tax from fuel tax to tax on anything no extra tax
But keep GST at a third,4 percent, of its current rate
If implemented all that retained wages would power the economy ,and give a higher standard of living
That GST by legislation, could be raised in time of need, flood fire storm drought to help fund needed help
New Capitalism would not stall wealth creation, but it could, due to the extra tax, better fund health care education low rent housing and a host of other things
We are and always have been in part socialist, compare our health to America for confirmation
Ithink my tax proposal will power economy,s even if taken up world wide the improved taxes can increase everyone's lifestyle

We're Capitalist, but with Socialist Base-Levels in the 2 areas of education and healthcare:

Education:

Socialist - Base Level of Education = Public Schools
Capitalist - Higher level of Education = Private Schools

Healthcare:

Socialist - Base Level of Healthcare = Public Hospitals
Capitalist - Higher level of Healthcare = Private Hospitals

And this is the reason why I say you need a Socialist Base-Level JOBS system, (built alongside the existing Capitalist one) not because I support socialism, but because the current system was never built fairly, efficiently or economically sustainably in the first place.

Ayn Rand- Atlas Shrugged (anarcho-capitalist) makes some interesting points in favour of Capitalism. But she fails to acknowledge the "moochers and looters" in capitalism upon the destruction of traditional historical cultural communities and historical family based ownership in favour of the "those that used the land most productively" principle (contractual ownership).

Since everyone needs land to live and suicide is seen as undesirable- it follows that traditional historical lands should not be able to be sold. Factories generally don't need large tracts of land- they need advanced technology (Thought creates advanced forms of matter and energy- paraphrasing Ayn Rand). So historical cultural and tribal ownership of land perhaps isn't counter to capitalism- and offers occupiers a useful tax agnostic safety net.

Capitalism advocates the free flow of labour, finance, resources to the productive engine- in practice this can have destructive and undesirable effects.

Capitalism encourages economic investment and innovation by allowing large profits.

Capitalism reminds me of the Panama Canal a series of locks that enable ships to pass between The Atlantic and The Pacific- Capitalism intends to dispense with "the locks" in favour of maximizing creative and productive flow- there are still roadblocks but they are specific to "the art" in question.

All communities should aim to be self sufficient, stable, responsible, healthy in mind and body. Communities need strong extended families, and identity within the larger community culture. High productivity is important for these healthy communities aims. The productivity in a community needs to be higher than that the cost to sustain the lives of the community- as the community interacts with other communities the community is influenced by them- in order to maintain stable communities they need to manage the influences that other communities have.

Just as rules on capitalism affect productivity- rules on borders affects the community- and it's positive and negative stability- what is right- capitalism or community?

In some ways Ayn Rand's Atlas Shrugged doesn't specify if communities should control their community borders at different scales- although does seem to object to certain union practices

THEY ALREADY PAID TAX on those earnings.

Armchair Critic,
No-one's propsing to ask the dead to pay more tax ! The inheritor pays ! After all, they're the beneficiaries. Also, don't forget that many present inheritance has benefitted from commercial welfare i.e. negative gearing so, many haven't paid tax on their assets.
someone asked 10% of what ? 10% of the selling price !
Mark-up is the cause of many of our economic woes. Many people say competition is good for business. Is it really ? isn't it always the wage-earning taxpayers who ultimately foot the bill when unprofitable businesses go to the wall ? The resent & present system is not sustainable !
Supply & demand is the ONLY workable solution, not over supply !
The big culprits in our economy are negative gearing & tax bracketing & out-of-hand public service salaries. And Greed !

Capitalism "seems the only system that works".

And...

"we must, change it". !!

The sort of anti-logic that made Venezuela the economic powerhouse it is today.

Capitalism "seems the only system that works".
mhaze,
So does Capital punishment & they got rid of that too ! That anti-logic is turning the west into the basket case we're experiencing now !
Capitalism works well until it is hijacked by the greedy. If negative gearing were to be removed & a flat tax introduced, Capitalism would work well for the simple reason that a level playing field would be self-regulating !

No easy task, just re-read every post, seems some want to put tags I do not see on the subject
Let me ask these questions, why do we pay tax, tell me if I get it wrong
We pay tax to defend our country, we also defend our very lifestyle
Health education aged care welfare transport infrastructure
We build water reservations so we can drink, we subsidise farmers in hard times, so we can keep that industry
So if we pay tax, every one, even those tax avoiders, we can build a better society/country/world
The hard task is not reading others contributions, it is in seeing we divide ourselves based on politics, not what is best for all
Is it ok for 70 of the biggest companies trading here to pay zero tax
If we, by using the system described here, put over a third more cash in our pockets we surely, would spend more and get very real benefits nationwide

Companies paying zero tax: if a company ploughs all its profits back into development, research, replacement, up-grade, etc., i.e. expenses incurred in running its business and planning for its future business, then it has no profit to tax. So no tax.

Joe

a company ploughs all its profits back into development, research, replacement, up-grade, etc.
Loudmouth,
Show us one (1), just one company that does that !

Loudmouth yes, but my proposal is to end false claims, not the true ones
Capitalism has changed,often,why not change again
Millionaires, even billionaires paying no tax?
International firms earning even more paying no tax?
What is wrong with the super rich paying, even helping the very real poor, by just paying their share
Growth, we can not neglect in the short term, maybe long too, more cash/purchasing power in circulation would lead to inflation
Rather than cut interest rates or raise them, we should use the GST to control and balance with raises contributing to helping those in need
Governments open and in the spotlight, could reduce tax on firms establishing but must not be a forever thing, short term only
Rich forever getting richer seems no way to go

Hey individual,

No-one's propsing to ask the dead to pay more tax ! The inheritor pays ! After all, they're the beneficiaries.

Glass half full, Glass half empty;
Depends on which way you look at it does it not?
One could say that's EXACTLY what they're doing.

The simple concept of the 'government stealing from the dead' is equally valid don't you think?

I'm thinking about it from point of view of the money, not the beneficiary.
I guess it comes back to the principle of taxing gifts and second hand items.

If I work and earn $100 after tax and I give that money to you, why should the government get a cut?
If they get a cut after I already paid tax to get it then it's not tax anymore its a ponzi scheme.

If I pay 30k for a new car, inc. GST;
Then a few years later sell the car for 20K and the new buyer has to pay tax/stamp duty;
Then a few years later that person sells the car for 15k and the new buyer pays tax/stamp duty
Then a few years later that person sells the car for 10k and the new buyer pays tax/stamp duty
Then a few years later that person sells the car for 5k and the new buyer pays tax/stamp duty

There was only ever 1 original purchase on 1 item of goods.
The vehicle decreased in value,
Whilst the total tax collected by government continually increased with every transfer of ownership.
How much tax does the government collect on the one item of goods as a percentage of that original purchase price?
And what about classic cars?
The government got their tax back in 1950, but they still collect a small percentage with every sale.
It may be that the total tax collected exceeds the original cost of the vehicle.

If a person already paid tax in the process of earning the money,
Why should the government get another piece of the action every time ownership of that money changes hands?
Is it not a ponzi scheme?

"Is it ok for 70 of the biggest companies trading here to pay zero tax"

Hell no.

But ScoMo just has to take out his pen and change the rules.

"From now on you can still claim whatever deductions you want, but a minimum of 5% tax must be made payable to the ATO.
To multinationals, please understand that this is the cost of doing business in Australia.
If you don't like it don't do business here."

Signed Knob Jockey.

There, just fixed your problem and made the country who knows how many billions...

Next...

http://www.abc.net.au/news/2019-04-26/should-the-rba-deploy-helicopters-for-a-money-drop-on-australia/11048102
Others are looking for newdirections,AC it is not simple for scomo to,just change the rules
Stranglely enought all over the world deals are done, to bring industry and jobs, that in fact enforce a basic unfairness
Another link will appear in my next post, it is not Labor policy, jut a view of what may happen, let us attack the idea or support it on its stand alone likelihood to work or not work

http://www.smh.com.au/federal-election-2019/could-bill-shorten-be-the-saviour-of-capitalism-20190426-p51hny.html
I am not posting this as propaganda, but on its merits
Yes informed contributors will know Rudd did something like this with his gifted money
Some still hate him for it, some will never understand it and how it kept us out of recession
But we are headed, believe me we are, for an international financial crash
I truly think that may, after it is over, bring about a new Capitalism
In the end, both links and Rudds , see most of the cash end up in the hands of the very people who pay no tax!
That must change or the world economy is only serfs in the service of the very rich and very powerful

If I work and earn $100 after tax and I give that money to you, why should the government get a cut?
Armchair Critic,
That's an emotional rather than a rational point. I agree that Government should not get the money but I agree that money i.e. tax should be paid to help deliver essential community services.
I have said many times here that the public service is grossly overpaid & it definitely is NOT value for money !
After all, we all want a sound economy but we can't have that without input from EVERYBODY including foreign investors & business operating under our flag.
Tax is an extremely vital component. Without tax there would not be any services. Where the problem lis is in the distribution. There's simply too much rorting from the top down. That is what we should be focussing on. Everything else will fall into place.

individual,

When I wrote that "Capitalism seems the only system that works" I was quoting Belly. (I'd have thought those "" might have been a give-away, but alas). The point was that if it is the only system that works it seems dumb to want to change it.

Sorry that went over your head. Perhaps I should include monosyllabic translations in future.

__________________________________________________________

I wonder how many of those prognosticating about forcing companies to pay tax realise that tax is paid on taxable profit. No taxable profit means no tax. Comments like " but a minimum of 5% tax must be made payable to the ATO" make zero sense. 5% of what?

Its all just whining by those for whom all this goes way over their head.

eg "If I work and earn $100 after tax and I give that money to you, why should the government get a cut?"

They don't get a cut. Honestly. The blind leading the blind

mhaze do you think we do not know tax is paid on profit not total turn over
Too that that figure can be and is being manipulated to avoid tax?
Quaint way to prop up your own views
Try reading the links, try getting past the Shorten to the rescue and read that whole link
It highlights a view, shared even by some super rich, that Capitalism needs renewal
This is not about party politics, it is about the future of the world economy
YES you know my view, capitalism is not perfect BUT it is the best/only system we have got is supported by that well used saying world wide
Who knows? informed posters may yet read and comment on, the links

Belly wrote..."Too that that figure can be and is being manipulated to avoid tax?"

How is it being manipulated? By whom? Do you have any examples? If so have you passed them on to the ATO since they have thoroughly vetted these businesses and not found any illegality.

If you mean that they are following the law in such a way that their taxable profit in minimised, then what laws do you want changed to stop that? They get deductions for depreciation? Do you want that removed? Or perhaps accelerated depreciation allowances? Or allowable deductions for donations? Or R&D. Or....

Also, are you aware that companies who pay tax less than the nominal rate have to issue unfranked or partly franked dividends and therefore the shareholder pays the tax. Any plans to change that?

Its a massively complex issue. But the gullible have been convinced that there are rivers of revenue there for the taking. There aren't. Never have been....never will be. But it lets the politicians sound like they have a plan to pay for their latest give-away of newest piece of graft.

mhaze I truly feel sorry for you, true not taunting just the truth
You are so very uninformed but claim to know much much more than you do
Thought this thread held interest, thought it promised two sided debate,maybe even other suggestions to resolve the problems
It is NO secrete 70 international firms pay no tax
Few do not know family trusts exist to minimise tax
Only you,it seems,have no idea about tax avoidance
What is your point? yes you do not like me, often blindly leep in to put the verbal boot in.
But even more often show you are not capable of? balanced thought
Try attacking the truth, not ignoring it
Still think, in the bottom part of my second link, a very good description of a very real problem, is there to see, no not a lefty's view, a well supported view Capitalism must change

How is it being manipulated? By whom? Do you have any examples?
mhaze,
Negative gearing answers all three of your questions !

indy very much more tax evasion is very well known, even recent tax haven showing many Australians involved
M Haze will not accept evidence ,he ignores the truth and hurls his bias not truth at anything he dislikes
In truth tax if not capitalism itself, must be completely reset new ways to ensure everyone pays their way must come

"It is NO secrete 70 international firms pay no tax"

I'm not arguing with that. Its probably true in some way. But not that they pay no tax, just that they pay no INCOME tax.

But the point is that they do so legally. There is no evidence that they are breaking the law.

So (and let me know if you can't follow this logic) if you want them to pay income tax, you need to change the income tax rules. You need to determine that some of the things that are currently deductible will no longer be deductible.

So my simple question, which you are trying so very hard to avoid, is what things will you change to make them pay tax. Just throwing a tantrum and demanding that they cough-up won't do the trick even though that's all you've got.

For example, do you want to get rid of the Tax incentives for innovation. That'd show 'em, right? Or perhaps the R&D tax incentive that businesses use to save tax?

You see, many people who really don't understand this such as yourself just get sucked in by the hype. They're told that companies don't pay tax at the levels they'd like and simply demand that that changes. They don't understand how they avoid paying tax, they don't understand what changes would be required to force them to pay tax, and they most definitely don't understand the ramifications of making those changes.

So we get people like Belly who doesn't understand the difference between avoidance and evasion and we get dills like individual who thinks international companies are expoliting negative gearing rules. Seriously!

You'll note that the article you keep relying on to give your claims a modicum of research doesn't mention international tax arrangements. You know why? Because neither party has any proposals to address this non-problem. You know why? Because it can't be 'fixed'. They've riled up the gullible over the issue but have no solutions.

Or at least no solutions that aren't worse than the alleged problem.
But the gullible won't get that.

"you do not like me".

I have no feeling about you one way or t'other. I think you are sincere in your beliefs but they are based on merely accepting whatever meme the left feeds you.

The thread has split into two themes. One is about company tax payments which I've covered above.

The other is about the alleged need to save capitalism. But the claims are only about allegedly saving Australian capitalism. Left-leaning hacks like Hartcher saying Shorten will save capitalism is pretty funny. That some believe it is funnier.

Its not about saving capitalism in Australia. Its not under threat. What is under threat is Australia's standard of living and international standing. Both of those sit on the precipice.

In a round-about way Shorten might save each by making things much worse much more quickly. Under the Libs there will be a slow decline until one day the electorate will come around to supporting the policies that will truly reverse the problems - massive reductions in all taxes, business friendly policies, ignoring environmentalism and the like etc. But that'll take a long time and things will get very bad before we get there. On the other hand, a term or two of Shortenism will be enough to get us there in a big hurry and then the repairs work can begin.

The only salvation for Australia is a return to true liberalism (Howardism) and horrors of a Shorten government will make that more likely.

that's why I'll be preferencing Lab over Lib

The way I see it, capitalism is probably the best way out at this stage, the problem we have is the tax system, it renders capitalism unsustainable.

Hey mhaze

"I wonder how many of those prognosticating about forcing companies to pay tax realise that tax is paid on taxable profit. No taxable profit means no tax. Comments like " but a minimum of 5% tax must be made payable to the ATO" make zero sense. 5% of what?

That comment was perfectly valid.
All companies need profit to exist, and I was talking about multinationals like Google or Mcdonalds.
If they don't make profit then why do they have a share price?
Why do investors invest in them if there's no profit and hence no return?

"eg 'If I work and earn $100 after tax and I give that money to you, why should the government get a cut?' "

They don't get a cut. Honestly. The blind leading the blind

For this I'm not sure if you're correct or not.
We'd have to look at what the ATO says about gifts.

http://www.ato.gov.au/Individuals/Income-and-deductions/Income-you-must-declare/Amounts-not-included-as-income/

Other amounts that are not taxable

Generally, you do not have to declare:

- rewards or small gifts such as cash birthday presents (however, gifts may be taxable if they are large amounts or you receive them as part of a business-like activity or in relation to your income-earning activities as an employee or contractor)

So, large gifts MAY be taxable.
In situations when they ARE, it means my argument was certainly valid.

If I earn 1 million dollars and pay tax on that million dollars
(Which means that the government already took their share when it was EARNED)
Then why does it get ANOTHER SHARE of that money if I decide to TRANSFER OWNERSHIP of it to you?

It's double dipping.
They already got their tax when it was earned.

The same principle applies for tax on inheritances;
http://www.ato.gov.au/general/capital-gains-tax/deceased-estates-and-inheritances/deceased-estates-and-capital-gains-tax/

- If your family already paid tax on the money when it was earned -

Have a rethink and get back to me; or don't.

I've just come across the following link.

I thought it may help clear things up:

http://www.abc.net.au/news/2018-12-13/one-third-of-australian-companies-pay-no-tax-ato/10614916

Dear Foxy,

If every company ploughed all of its pre-tax profits back into its business operations, plus write-downs on losses, depreciation, revaluation of assets, R & D, replacement, salaries, standard expenses, etc., how much tax should they pay ?

Interesting: ploughing back is just how Marx defined Capitalism: instead of blowing money on grandiose schemes and palaces and indulgent spending as in earlier economies (what he called primitive accumulation), any money earned (M) was put back into the business as extra capital (C), which in turn generated (through the exploitation of workers) more money (M) than before which in turn could be ploughed back into the business as more capital (C) and so on (capitalist accumulation).

After all, any capitalist who spent too much of his/her profits would soon go broke.

Love,

Joe

how much tax should they pay ?
Loudmouth,
they should pay tax on their profits after all other expenses !

Individual,

Of course: after all legitimate expenses. We all do that when we prepare or tax forms, deducting all legitimate expenses. Then we pay tax on what is left over. Fair enough.

Certainly, i don't support tax havens, and the 'creative skills' of accountants to divert income generated in Australia to those places, in order to avoid paying tax in Australia. I look forward to the day when, somehow, there is a world-wide moratorium on tax havens, when tax has to be calculated in the countries where income is generated. But there are too many vested interests everywhere for that to happen.

I wonder if any of Trump's companies are registered in tax havens. I suppose that will become clear if he ever releases his accounts.

Joe

Foxys link is telling, my intention n starting this was to highlight such a that
Too to say current form of capitalism is making the extremely rich richer and the poor poorer
Is an economy forever stuck in its current grove? or can it develop into something far fairer for all.

AC

"Have a rethink and get back to me; or don't."

Oh, I'm sorry. I didn't realise that when you said "earn $100 after tax and I give that money to you" you really meant "If I earn 1 million dollars ". You just left off a few zeros. Could've happened to anyone. How did I not realise that.

BTW even with your attempted face-saving additional zeros, you're wrong. A large gift is only taxable if the donor derives some sort of benefit from it eg granny gives the kids a large gift on the basis that they look after her in her remaining years. Otherwise not taxable.

"All companies need profit to exist, and I was talking about multinationals like Google or Mcdonalds."

Well they need profit eventually. But we are talking about taxable profit which isn't quite the same thing. And Google and Maccas make a profit and pay taxes here.

"If they don't make profit then why do they have a share price?"
Plenty of companies who aren't profitable have shares eg Tesla, Facebook, Twitter. Indeed all companies have shares. Just how little do you know?

"Why do investors invest in them if there's no profit and hence no return?"
Because they think they'll eventually make a profit.

Again AC....5% of what?

Belly

"current form of capitalism is making the extremely rich richer and the poor poorer"

Half right. The rich are getting richer. And the poor are getting richer too. eg the people on the poverty line today are 40% richer than the people on the poverty line in 1970 in real terms.

m haze debatable, but is it true a tax system like the one I put forward, and the one both links point to, will bring huge increase in money available to be spent
In all truth it would lead to inflation too, unless other things changed
Have the true poor , say those sleeping on the streets, got it better than 1970, well there are more of them
New capitalism will come, nothing stays still forever
It can be better or even worse but change will come
Maybe post the coming GFC

wonder if any of Trump's companies are registered in tax havens.
Loudmouth,
No good complaining about Trump when our own are just as exploitive ! The average public servant costs us way more than what they give us in return !

indy on this matter tax, we seem closer, but mate remember or maybe you do not Australians Clive Packer telling an inquiry into his tax the following words
Yes I pay as little tax a I can, it would be madness not to
Yes Trump Avoids tax,yes he will not let us see his tax records
Take THE politics OUT OF THIS SUBJECT
It was and always will be about a proposed new capitalism, a better fairer way of taxing
If we defend those we like in this debate we may as well not have it
We have a system in trouble, it may get worse,threat to world trade free trade and the coming GFC
This proposal is that something better can be achieved

Yes I pay as little tax a I can, it would be madness not to
Belly,
Do you also take as little of the available benefits as you can ?
We need a level playing field for tax. Flat Tax ! Earn a Dollar, pay 10 cents tax. People mentioned Consumption Tax here before. That'd be a good start ! Negative gearing has to stop, it's too costly !

So we have stalled
Yet in a way proved for some, in depth conversations about other that our biases is not happening
Others outside our walled place of debate, all over the world are talking about this
As the coming financial crisis, seen here in house prices falling, are in my view, like every past crisis, evidence new capitalism will come

I'm all for paying a reasonable amount of Tax but when I see so much tax money being blatantly squandered I can't help feeling dismayed !
People get right up front to demand services but when people are asked to contribute in a small way, they dissolve into the background.
This nation is crying out for infrastructure projects that create much needed employment yet only a fraction of public funding goes in that direction.
Capitalism should be creating money, not get it out the Govt coffers !

Hey mhaze,

My argument wasn't so much in regards to an actual dollar amount rather than the 'principle of double dipping' whenever and wherever it exists.
I'm not a tax agent, and I don't know all the ins and outs.

My argument was that 'double dipping whenever and wherever it exists is no more a fair and reasonable tax system than a ponzi scheme'.

Its the 'principle' of it.

If your father 'as a hypothetical' busts his backside working a crap job all his life to put food on the table and pay off the family home;
then he already paid the tax on the money he earned to pay for the family home.

The money he used to buy the family home was HIS money - the money that was left over after he'd already paid a tax component.

Now if he passes and you end up with the house in an inheritance there's no immediate tax owed, but if you sell it there is a CGT.

And if you look at it technically, he passed and transferred ownership of all he had to you.
All he had being 'what he had AFTER he paid his tax'.

Now the government wants another bite.
They can call it anything they want, but for them to try to take another bite 'get their mitts on it anyway they can'.
- is no different than taxing your Dad again as the a tax on dying.

The same for gifts:
A hundred dollars or a million dollars.
If one person already paid the tax when it was earned;
then if there is another tax in the simple transfer of ownership then that's double dipping.

Most times a transfer of ownership of money occurs its a business transaction which includes a tax for 'goods and services'.

Transferring ownership of money or assets by gifting them technically should not ever incur a tax;
so long as the 'gift' is not actually a payment for some kind of 'service rendered'.

A recent visitor to our shores, that fine America Rupert Murdock, pays very little if any tax
This government pays him
Why should the very wealthy avoid tax but the worker have his/hers taken out of the pay packet
Is the current form of capitalism creating wealth for the few and poverty for the rest

If I build a boat in my spare time with materials I purchased from the hardware store & all tax paid but the boat doesn't make me any money then it should not be an asset & be taxed again as in old age pension asset test..
If my kids end up with it then they should pay an inheritance tax but this tax should not be more than 5%. This would serve several sound economic points.
The kids will learn that nothing is free, the tax department would learn that people deserve what they worked for, people would feel rewarded rather than perseucted for their efforts & it would stimulate local economy.
Not to see the positives in that requires a Uni indoctrination.

We are at the shallow end of the pool now writing of that well known hip pocket nerve and ignoring the very real truth
Those who pay no tax, but have huge incomes are leaching off the rest of us
Why, we are not talking about thousands but millions even billions
What is an economy if it has not intention of being fair

Capitalism will change, because it must
Tax system will change, because it must
To continue as we are challenges capitalisms survival

Belly,
Cheers, your best post to-date !

Sorry we never realy got into this subject
We will however, we will in far worse times that are about to come, sad but true
The GFC screamed at us the system was flawed, it should have told us it was out of the hands of every day people
Our banks, here far away from the birthplace of the GFC have been uncovered as no more than robber barons
Yet as we march towards our lemming like cliff some think only in terms of their politics not humanity
If we can not get the only system we think works right?
We deserve the coming pain
regards indy

Just rap it up, this mornings swim in international media saw me watch a fox news broadcast about the American economy
Not a place truth gets much of a run but the fed reserve bloke was worth listening to
Too the SMH house prices, just how much has been lost by that fall
Seems some are paying more than their home is now worth, and are behind on payments
Cut in interest rates? power more lending?
Not a good idea remember America's problems with its housing market
And too consider what if, say in two years, interest rates rise by 2 percent
We will talk about this again

"If my kids end up with it then they should pay an inheritance tax but this tax should not be more than 5%"

Why should they?
If the money you spent on materials at Bunnings was the non-tax component that was left over after you paid tax on earnings;
Why should the government get another bite?

If they do get another bite, it means that the tax you paid on the earnings you used to spent on materials at Bunnings to build the boat was now taxed at a higher rate.

It's more or less the same thing.

Why?

Because the government has now taken a larger chunk of cash in relation to what you built with those materials, over and above the tax you already paid on earnings you used to purchase the materials.

If the governments collecting tax upon tax on a single item, that's not a fair system, its a ponzi scheme.

Lets start with something smaller.

You go to work, get paid your wages and pay the income tax component.
Then you go to JB Hifi and buy a TV.

Eventually you pass and your kids get the TV and the kids don't need it so they sell it. The government says we want CGT.

They already took a portion of your income as income tax.
That's what it took to earn your money and had nothing to do with the TV.

They took a portion of your spending on GST.
That was the price of spending your money on the TV.
TV tax.

And now they want to get you again?

[Cont.]
If someone else already paid their tax when they earned the money to buy WHATEVER item they did;
Why should the government create another tax in relation to that item purchased?
They are taxing the item twice, which is more or less the same as if you paid twice the normal tax rate when you earned the money.
Not only that they can collect tax on the same item numerous times whilst the consumer, all he gets is devaluation of assets from wear and tear.

Compound tax.

What if your kid sells the boat and it transfers ownership 10 times?

Tax to the power of 10.

Tax on tax on tax on tax on tax on tax on tax on tax on tax on tax

All for materials you purchased with money you had left over AFTER you paid your tax.

Is it a fair tax system or a pyramid scheme?

The value of the item went down in value with each transfer of ownership.
The total value of the tax collected into government coffers in relation to this boat increases with each transfer of sale.

Eventually the boat isn't worth anything;
But to the government it was a goldmine while it lasted.
It just kept on paying, like a poker machine.

TAX is not theft, apparently avoiding it is not crime
We are taxed to pay for the things we demand
Some pay tax so others do not have to
We can look at a new capitalism that changes forever how much we pay
By making everyone pay
We would pay less therefore spend more
Capitalism feeds on growth

What if your kid sells the boat and it transfers ownership 10 times?
Armchair Critic,
Yes, because every time it got sold the seller got paid ! It's not just about the item it's about someone selling to get money in return !

Well lets say there;s some form of tax every time the boat changes hands
- For the sake of argument, we'll call it 'stamp duty' -

tax on tax on tax on tax...
Whilst your asset devalues;
The government cashes in on every transfer of ownership
And the money you used to pay for boat was money leftover after income tax, and you also paid a goods and services tax.

Sound like a fair system? No.

AC can we agree Capitalism is not quite what it should be
Can we too consider while it is evolving as it should, it could be far better
TAX that hip pocket nerve thing seems to have taken our eyes away from the question, is Capitalism working as best it can
If the answer is no, can we, as part of improving capitalism not killing it, we improve the tax system
Last is every one, no exceptions, paying a fairshare unfair

Hey Belly,
I honestly don't know enough about the in's and out's of the tax system to be able to offer any kind of meaningful solutions.

If you want to build a better system however, than you have to firstly identify all the faults and flaws with the old system, and I'm not too bad when it comes to identifying faults and flaws in an idea.

All I was trying to do was point out the difference between a fair tax system and a pyramid scheme tax system in principle, and in potential situations where the government double dips, with the result being equal to charging a higher tax rate in the first instance; or worse that the government enjoys 'compound taxes' like compound interest.

There's plenty of kinks and flaws in the systems we have.
Of course these systems can always be fine-tuned and improved, and they probably need to be as you suggest.

Armchair Critic,
How many times have we witnessed the kids blowing everything the parents worked hard for ?
Why ? Because it was given to them for nothing so there is no sense of value & respect. Were they required to pay inheritance tax/duty etc I'm sure most would be way more responsible with what they receive for no effort.

Hi Belly,

Just a suggestion: please, please, read over your posts before you send them. Check for spelling, certainly, but also for punctuation, appropriate use (or non-use) of upper or lower case, and above all sense, flow, readability.

Sometimes I dread having to read your posts, no offence. Idiosyncrasy has its place but so does comprehensibility.

Cheers,

Joe

Loudmouth first to admit my posts are not well formed
And the spelling never will be
Having troubles with spell check, keyboard too
Do try but you need to know not every one of us had the schooling you may have had
Taught myself to even read, after leaving school
Can not set up my PC as it should be, grammarly on trying it, murdered my spell check, sorry doing my best
Worth noting, a country workforce, road workers, we found one in six could neither read or write, [age had a roll] country folk leave school to work.

So we return to the subject, unschooled as I am some deep thought went in to this subject
Years and years of it, just think, it seems clear we can not forever follow the path we are on
Capitalism manufacturers poverty, but great wealth too
Can we truly think jobs and growth is what it is all about?
Forever?
I hope the thousands of books I have read, the dozens of post school education things I have done, has not left me unaware of world events
PS caps lock, new keyboard, shifts the screen, often, so it was deliberate not using Caps
Loudmouth I respect you but again remind you not everyone can be as perfect as you want them to be

What has been erroneously portrayed as Capitalism is in fact mere opportunistic loop-hole exploitation by the above-average greedy !
Govts seem to not bother plugging those loopholes why else aren't they working on tax reform ?
Negative gearing causes inflated prices & artificial markets resulting in over-supply with no benefit to society in the long run. The only growth is in pollution !

JOE Honestly think a lot more of you than you do of me, but why no reply, you did taunt me a little in my view mate have seen your posts for years
You are not a bad bloke, in fact a very very bright one
We, me too, must face it each of us can not be the same education or lack of it is no crime
AND IT IS AN EVER PRESENT PROBLEM
My union official days [I do not talk like I write] saw huge lovable tough men and women, want to talk around the back of the onsite lunch shed
Left me glasses at home, or the missus usually does this for me, warns that bright, top grader operator, cannot read or write
Forever proud they trusted me enough, to let me help
Never ever thought laughing at them was something I should consider
Do you know how many, seemingly rude people,are trying desperately to get by without saying they too can not read or write
Maybe I am being a bit hard on you, so let me put myself down, true story
In my first days as Union delegate on the front line of negotiations my handwriting,without the aid of a spell check, had me baffled too
Photo copied about 36 copies, sent them out
Got back some truly funny stuff, but if they never arrived, big trouble
486, Fell out of a central stores truck, poster once seen here more often showed me,over and over again, how to use it, spell check and he, near had break down, trying to teach me
Went onto much bigger and better computers,but my handwriting days remained in my mind, hanging on my wall is the front page of my then weekly information to members
Made by my peers who insisted I use it, it has that Bear known to be fond of honey, named Belly Bear it claims this
My spelling is ok but the words wobble and end up in the wrong place
regards

Indy I see no other system
A Dictatorship would need to reward for effort
I do however think we will see a new capitalism

There is no need for animal cruelty under any circumstance,
Belly,
I think you're on the right track with that one. Because, when you think about it, it can't really go any other way. The present system is saturated with flaws & the break-down has already begun. Reward for effort really is the only way out !

There is no need for animal cruelty under any circumstance,
Oooops ! Cut & paste gone wrong, apolgies !

should be,
I do however think we will see a new capitalism

Foxy, Aiden Indy started this thread after weeks of deep thought and a heap of research
Why Is it 70 of our very biggest firms pay no tax
What is wrong with the early signs the internationals may be forced to pay tax in the country money is earned in
How can a family trust be tax exempt of pay very little tax
Is it in everyone's interest to have some pay no tax
Would the economy consume more if we paid less, but new laws saw more tax collected
What is the purpose of taxing us
Is it to fund the things we demand of government
Then would more tax feed more infrastructure therefore more tax?

Hi Individual,

Capitalism is endlessly inventive, there's nothing like the threat of loss of livelihood to incentivise capitalist innovators.

Once it was canal systems (eighteenth century), then steam engines driving the textile mills, then railways, then electricity, then the internal-combustion engine. And so on. Now it's subsidies for 'renewable energy', and electric cars. Each innovation means big bucks to enterprising people with capital. Even Marx talked about the endlessly revolutionary potential of capitalism (in its own interests, of course).

Cheers,

Joe

http://www.econlib.org/library/Columns/y2019/LeeRogge.html
I could have posted ten thousand links like this
Do so only, to support my view, and highlight others are saying the same
Not looking for socialism
Would be nice however to have a more socially aware capitalism
Not saying any other system would work
Once would have
But I was wrong, slothfulness feeds on something for nothing
Just as uncaring capitalism feeds off the very needy
EG 32 year old male, my village, never held a job,refused a job I got him, then 26 dollars an hour, six dollars and change more than the average here in those days [said it would ruin his social life]

Capitalism is endlessly inventive,
Loudmouth,
Of course, it has to be because of the flawed tax system ! Capitalism is about making as much profit as possible. Capitalism is not self-regulating. For capitalism to be economically sustainable it must be confined to guidelines. The problem is that the present guidelines are all over the place instead of being constantly parallel. I liken it to a rail line. If the rails widen or narrow the train will de-rail. A tax system should be based on the same principle !
Do away with write-offs, tax bracketing & negative gearing, we can't afford it any more !

Watching 60 Minutes right now on the Boeing 737 Max 8 makes me reel at the thought that those tragedies were directly attributable to Capitalism i.e. shareholders !

You must be right indy,if the story is right
And it seems it is, but not by far the only time productivity, in its present form, and profit over ruled workmanship
Point of this is reform not removal
China after all has a very different form of capitalism than us

China after all has a very different form of capitalism than us
Belly,
Yes & they have a very different mentality also. They care about their Nation too !

Indy fairdinkum Chine,confronted by Trumps latest move, should concern us all
My view is it seeks war
And after today our trade is threatened
Never get me to even consider that country cares for its people

Belly,
Surely if anyone is that country, it's the people not the government?

Aiden think better of you bloke
Briefly in my youth, thought [remember far different days than now]
Communism was a promise not a threat
I was wrong, China has a type of national capitalism that controls its people
In fact in almost everything they do
And those people are as far away from participating in their government as the people of any dictator
Dream no dreams of an inclusive China

Hi Belly,

China has a capitalist economy and a quasi-fascist political set-up. The residual Marxist in me suggests that no socialist state has ever really got off the ground, before it degenerated into a repressive system - Russia, China, Vietnam, the lot. That suggests that (Marxist) socialism is ultimately impossible - on implementation, its 'Perfect Blueprint' immediately hits real-world problems, not least of which is the objections of the workers and peasants whom it is supposed to champion (has any 'socialist' state ever had a worker or peasant in charge ?) Remember Kronstadt.

But it seems that the young children of the current 'Left' are blissfully unaware of all that; and since they will never achieve 'socialism' in Australia, they will never have to learn. If I live to 150, I would expect to see many of them, Gen Y, but middle- and old-aged, in their sensible clothing, walking their spaniels and attending rallies and sit-ins and waving placards (boy, that must feel good) , ever hopeful of a people's uprising, having learnt nothing in sixty years.

Come to think of it, when was the first time a leader rose up from the ranks of workers and peasants, or even as someone who was born AFTER the Revolution ? Gorbachev, born 1931, Ukraine, taking power in 1985, nearly seventy years after the Russian Revolution. Every Soviet leader before him was raised before the Revolution, had a lifelong career in the Party and took over already a decrepit relic: Kosygin, Brezhnev, Yobchenko, then Andropov. In China, where they do things more dynastically, this rule is varied only as some 'young prince' takes power, children of former leaders, like Xi Zin Ping. And in North Korea, where the Kim royal family has ruled over the people since 1945.

Joe

no socialist state has ever really got off the ground,
Loudmouth,
How could any as long as people are seeking reward for effort ? The whole world will go more towards Conservatism as time goes on because it really is the only way forward.
Too many can now see how too many have a good life on others' efforts.
Socialism is only good as a dream, in reality it is a nightmare !

Belly, I think you misunderstand my point. Governments rise and fall, and eventually if they don't step aside they get overthrown.

Just because the Chinese Communist Party are currently in control of China doesn't mean they ARE China.

And after today our trade is threatened
Belly,
If that means fewer non-citizens buying up land here & controlling vital infrastructure & fewer Australian greed-bags making less profit than that'd be a good thing.

Hi Aidan,

As an ex-Maoist, I have to agree that China will face some huge problems in the near future.

Demographically, with its failed One-Child policy, its population will hit a limit by 2050 (and only because people will be living longer), and decline from then on, to maybe as low as 400 million by 2100, while India's will pass 2 billion well before then. If I live to 150, (no: 160) I'll let you know if that happens. Either way that will mean a huge old-age population and relatively few workers and tax-payers to cover their costs - and many of those professional workers will migrate. Many to Australia.

China seems to be living on an inflated currency, based on an unofficial policy of 'monetary easing' and lending to countries involved in its Belt and Road Initiative. It may find itself saddled with innumerable infrastructure projects which they have part-funded but for which they can't get full repayment (the purpose of the Initiative, after all).

As a semi-fascist state (not 'semi-' in the eyes of the Uighur and Tibetans), the Chinese (sarcasm alert) socialist regime is busy repressing a growing proportion of its population, Uighurs, Tibetans (and 'Tibetans' mean millions of people living well outside Tibet), Muslims, etc, who - a contradiction of Chinese socialism - were not subject to the One-Child policy of the past forty years. So their numbers will grow healthily, if somewhat restively, along with those of many other national minorities in the south, and north, and west. I suspect that even the policy of Beijing dialect dominance will be challenged by Cantonese, Szechuanese, Hokkien, Hakka and all of the other national-minority groups.

Surely any decent society, such as socialism claims to be, has to build on democracy, if that's not a contradiction ? There seems to be preciously little of it in China.

Joe

Loudmouth nothing to disagree with there, I too was a Marxist in my lost youth
And yes we can, and do, hope the Chinese people will bring about a better freer China
Not an easy task, starting from what they now have
But that is much better than what they had under chairman Mao
Even today, here, to get even a seat in either party, you really need a degree and history of being someone's office manager

Well, at least the Chinese aren't selling their land to non-citizens ! That's a hell of a lot more patriotic than selling it !

No need for fear bindy, China will never own Queensland, the Japanese and others will never sell it to them

Belly,
Valid point !

China however may, by weeks end, beina trade war with America

Belly,
Look at it on the bright side. There are 1.2 Billion Chinese, just imagine if there were that many Australians ? Who'd they sell the country to ?

indy we can not avoid another truth
You do not need to own this country to feed from it
Multi Nationals who pay zero tax do it all the time

Maybe worth a quick look at experts warnings about Trump actions against Chinese trade
Let us be honest, after all it matters
I can see why Trump, and all sides in America should be concerned
Trade sometimes is out of balance this trade is
But the big stick is not the right way now, America, the world,and capitalism, will suffer at least as much as China

It has long been said that the Eagle & the Bear will unite to fight the Dragon.

Indy yes it has by psychics who also predicted the Royal baby would be a girl boy whatever
We would,some said, be at war every year of the last 50
This morning's news, near a trillion dollars lost on world stock markets because of Trump's stance on China trade
Read more China's trade has dropped 10 percent we live in interesting times

near a trillion dollars lost on world stock markets
Belly,
Somehow I get the feeling that that's just greed jargon. It's more than likely the sum of money they were hoping to make but didn't. They'd still make a handsome profit despite it ! What they call loss is simply not making as much as they try to make !

indy no in fact after reading even later news reports it was more than one trillion
It highlights the very real danger a trade war can bring
A new capitalism may save us from such headlines
But as you and I dabble in this storey in a week's time we could be in the middle of the GFC we talk of

http://www.smh.com.au/business/markets/lots-of-broken-hearts-today-wall-street-goes-on-rollercoaster-ride-as-trade-tensions-ramp-up-volatility-20190510-p51lwc.html
One day,hopefully not soon a story like this will signal the start of a very real crisis
Nothing, no investment, no single thing we do with money can be safe forever