Quick comments & quizzes

Quick comment: what needs to change?

9 April 2015

Countries globally are reviewing their tax systems for a reason – they were built for a world we don’t live in anymore. Over the coming weeks we’ll be sharing information about our current tax system. We want to know: what do you think needs to change for a better tax system that delivers lower, simpler, fairer taxes?

Your comment may be moderated in accordance with our moderation policy.

Comments closed 12pm Friday 10 April 2015 AEST.

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51 thoughts on “Quick comment: what needs to change?”

  1. Tim says:

    There is nothing very useful here.

    All these suggestion fall into two categories, tax diversion, (somebody else must pay the tax), and raising more taxes (presumably to be spent on your favourite program, if not yourself).

    Unfortunately both these categories come with a cost other than the amount raised – inefficiencies of that form of taxation. Even if all the tax raised is immediately turned round and spent without loss, most of these taxes, income tax, GST, etc. carry major efficiency costs – incidence, tax wedges, excess burden, and so on.

    So what? These efficiency costs of raising tax are significant, and the bottom line is that they reduce activity and significantly increase unemployment. By a measure of hundreds of thousands.

    All these taxes, including the GST, are grossly out dated and primitive. But as Ross Gittins wrote, there are two sorts of taxes, taxes on economic rents, and the others.

    Whoa! Wasn’t the rent tax decisively rejected by the mining industry? But my hope is that in 100 years time the ONLY business and private tax will be an economic rent tax, and all these other taxes, including the GST, are consigned to the dustbin of history.

    Yes, an economic rent tax is totally efficient. No tax wedges, incidence effects and so on. Why? Simple. Taxing economic rents does not affect supply in the slightist. For the economists, the supply curve does not move.

  2. Andrew says:

    I appreciate the preoccupation of tackling the taxation benefits on Super of those on high incomes but why do public servants on extremely generous defined benefits superannuation plans seem to be immune from scrutiny and change.
    Governments seem to be very happy to tinker with private superannuation but not those of public servants? Could self-interest and fear of union backlash be issues here?
    I know three people who will retire on a defined benefit super of over $55,000 per annum. The CEO of Challenger Annuities this week stated that to purchase an annuity equivalent to the age pension of approximately $37,000 per annum would cost $1million! Hence these people are sitting on super plans worth approx $1.5million. These are funded by current taxpayers so why aren’t we looking to modify these benefits to public servants in line with what is proposed to the rest of us?
    The original premise of establishing these plans has changed and we cannot afford to maintain them but I hear no discussion on modifying their benefits? The Future Fund is all about covering these costs which are spiralling out of control as their life expectancy increases but wouldn’t that money be better placed invested for the benefit of all Australians not just those on defined benefit plans.
    Time to really look into these and bring them into line with the rest of us.

     13 Like
  3. Chris says:

    After saving a housing deposit for 16years in Sydney, the size of the loan i need now is more than when i started saving in 1999. Structural change is required in Housing. SMART macro prudential rules should be designed to create a wedge between new and existing housing supply.

     3 Like
  4. Robin Henry says:

    1. Cut out all funding of religious organisations

    2. Reduce amount of write-off people can receive under negative gearing eg, 10% of taxable income

    3. Scrap progressive tax. Replace with a flat tax of maybe 20%. No tax returns, no refunds.

    4. Increase GST to at least 15% but not much more

    5. Scrap State and Territory stamp duty on all but house purchases

    6. Impose a ceiling on rents adjusted in line with CPI twice annually

    7. Cut overseas funding for countries that don’t need it or whose values do not align with ours … at present we are funding people who hate our very existence

    8. Provide after hours medical care at all Accident and Emergency Departments so that those without accidents or emergencies can be redirected to a GP or other qualified professional; bulk billed. A&E should not be used for minor medical ailments that could have been handled by a GP or trained nurse

    10. Reduce the tax free threshold to $15,000 or $10,000 temporarily with a review after the budget gets better (if it does)

    11. Make sure companies cannot avoid their taxation obligations and reduce company tax to a comparable rate with other countries in our region eg, Singapore. Better to get a small part of a big pie than nothing

    12. Design Australian military vehicles and use the now fading vehicle manufacturing facilities to produce vehicles for our defence forces instead of buying overseas

     14 Like
  5. Winton Bates says:

    I support proposals to: replace taxes which have the greatest disincentive to investment; promote more equal tax treatment of all forms of saving; and stop providing aged pensions to people who do not need them. Some specific proposals:
    1. Encourage states to replace stamp duties on land transfers with land taxes.
    2. Remove incentive for superannuation to be taken as a lump sum.
    3. Tighten up the means test for the aged pension and include housing in the assets test.
    4. Include owner-occupied residential housing in capital gains tax.
    5. Reduce tax rate on capital income.
    6. Make all capital spending tax free or subject to a lower rate of tax.

  6. Michael I says:

    Include the house as an Asset at Govt. Valuation if less than $650,000 or a nominal value of $650,000 if Valuation is above this amount and increase the
    the allowable maximum for the pension by $650,000. Amounts above this are excluded from benefits unless the family home has been held for 15 years or more in which case the nominal value applies.
    Negative gearing should be abolished with a minimum notice and a minimum deposit applied for investments before deductible expenses apply for investments. Say the same amount as a secured housing loan.
    Capital gains tax should be fully taxable. Cost Price less Holding Costs.
    4. G.S.T.
    Should be applied to all items except fresh farm produce. e.g. meat, vegetables, fruit.

  7. John C says:

    Thanks , this is a great opportunity to have a say in such an important matter.

    1. The GST should be increased – even to 12.5% as this would help the budget significantly without hurting anyone very much. Any tax review without GST review is fundamentally flawed.

    2. Corporate taxation rates need to come down as soon as possible, to encourage corporations to base themselves in Australia and to reduce their incentive to avoid tax.

    3. Capital gains tax should be applied only after indexation, as it once was. CGT which is non-indexed is very unfair; it taxes nominal gains, which are often only illusory, as the real value of an asset quite often declines.

    4. Tax concessions on high-end superannuation balances should be reduced. The very well-off are subsidised into greater wealth by ordinary taxpayers.

    5. Current discussions are correct to target high-net-worth pensioners, who often spend or shift wealth in order to receive full or part pensions. If we can afford independence, we should be that.

    6. HOWEVER, taxation is less of an issue than is government spending, WHICH MUST BE REDUCED.

     4 Like
  8. Margit Alm says:

    1. Introduce use-and-abuse taxes for natural resources, including a land tax
    2. Introduce a Tobin tax on currency exchanges and share transaction, micro-size as not to hurt mum-and-dad investors too much.
    3. Increase and broaden the GST. User-pays taxes are much harder to avoid and evade. They also give people a choice where and how to be taxed. Don’t be concerned about the poor: they can be compensated if they are genuinely poor. Besides, the poor don’t make the world go round.
    4. Abolish payroll tax, disincentive to employment.
    5. Gradually phase out all income tax for individuals, business and corporations and replace with indirect taxes as well as direct funding of core social security services, including catastrophe funds for businesses.
    6. Thoroughly reform social security from welfare to insurance.
    7. Thoroughly reform super from an investment vehicle to a ‘deferred income’ method.
    8. End upfront cash payments to families. Instead reimburse families for certain child expenses upon presentation of documentation.

     1 Like
  9. Anthony says:

    1. If companies now act global, crossing international border as they like, why don’t we have a corporate tax regime that does the same with a global tax rate and distribution authority?
    2. One single personal income tax rate with a tax free threshold.
    3. Decriminalise and tax drugs.
    4. Change GST to include all sales, but in a tiered structure for harmful, luxury and standard, for example. Plus a higher land tax on ownership so that the super wealthy don’t benefit so much from accumulating assets at the expense of the less wealthy.
    5. Make the super contribution tax a discount on the individual marginal tax rate. It currently serves as a disincentive to those most in need while benefiting the highest income earners more than any others.

     7 Like
  10. Hugh M says:

    With thanks to R. Ambrose Raven (the Conversation), reference at end. These tax changes provide a total $243 billion, yes billion, increase in tax revenue to the budget.
    “The age of entitlement is over and the age of personal responsibility has begun. . . Everyone has to help do the heavy lifting here”. Here’s our chance to help:

    Class A – utter waste of money:

    > …owner-occupier capital gains tax discounts………. $23.3 billion/yr over FY16-18

    > …capital gains tax discounts for indiv & trusts… ….$9.1 billion/yr over FY16-18

    > …fossil fuel subsidies…………………………………..10 billion

    …………….(24 TIMES car industry subsidies @ 200,000 jobs + $30b)

    …………. Carbon Tax……………… 4 billion (per year for 4 years)

    > …mining industry subsidies…. ………….4.5 billion (fuel $2 billion)

    > …negative gearing………………….. …………………6.4 billion

    > …superannuation tax concessions… ……………….$36 billion in FY15

    Class B – bloated subsidies of private profit:

    > …First Home Vendors Grants…………… ………………….1 billion

    > …child-care rebate (incl to states)………………………..8 billion

    > …private education………………….9 billion ($36 billion over 09-13)

    > …Private Health Insurance Rebate…………………………..5 billion

    Class C – given away but recoverable

    > …owner-occupier capital gains exemption……………….19 billion/yr over FY16-18

    > …1.5% company tax cut in FY16…………………………….2 billion

    > …transnational tax evasion…………………………….. $8.4 billion

    > …excessive tax cuts to richest………………………….$15.8 billion

    Class D – increasing taxation to OECD average

    > …extra tax revenue………………………………………$85 billion

    Class A+B+C Total: 93 + 23 + 44 + 85 BILLION = $245 BILLION ($A243,000,000,000)

    Private education can be paid for entirely by those whose children enjoy it. Direct public provision of services such as health care would be far less costly and allow better service.”

     9 Like
  11. Rick says:

    The only major challenge in the past five (5) decades for nations in administering their income and excise taxes and GST tax laws, is the the combination of internet, electronic payment systems and electronic products. Consumers and businesses in Australia can and do purchase electronic products, pay for such and receive their purchases (viz software, music, e-books and video) from foreign suppliers, through the internet. Such sales are presently beyond the jurisdictional reach of the Australian Taxation Office.
    All other domestic and international commercial transactions can be and are subject to national tax laws.
    Singaporean, Dutch and Irish favourable corporate tax laws have been extant for decades and successive Australian governments have known this but have done very little to address this profit shifting or the loss of tax revenue to such low taxing countries, by closing legislative loopholes and tasking the ATO to be more pro-active and enforce our existing tax laws. The Australian tax code has provisions regarding transfer pricing, thin capitalisation, debt-equity, etc rules for international transactions and multinationals, but the ATO does not appear to carry out vigorous compliance work in these area.
    To answer your question about what change is needed for a better tax system that delivers etc, is for the Australian and state governments to reduce and curb their spending habits and in particular on handouts for their base political purposes.

  12. Elizabeth B says:

    Increase the GST,give W.A. their entitlement ,get rid of negative gearing for more than 1 property.
    The smaller states need to be more responsible in their spending.

     2 Like
  13. Howard Cairns says:

    My thoughts on Taxation:
    Superannuation: No Tax subsidies to offset income tax, No lump sum withdrawals allowed, Retirement income stream paid as an annuity
    Age Pension: All workers, investors (not working) must pay a suitable % of their tax into a dedicated pension fund administered by government authority (e.g. Future Fund) but not usable by government for any other purpose.
    Employers to continue to pay into same fund.
    People wishing to pay extra into a private Super fund can do so without penalty at retirement.
    Asset test includes family home if worth $1 million or more (indexed).
    Decrease threshold for other assets.
    Business taxes: remove rorts, bring in 25% tax on exported profits,
    Introduce land tax on land worth more than $1 million.
    Abolish negative gearing
    Abolish capital gains subsidies, exemptions etc
    Abolish private health insurance subsidies
    Abolish stamp duty and payroll tax
    Unemployment payments only after worked for 5 years
    Child family payments limited to maximum 3 children – no subsidy any children after that.
    Single mother pension limited same as above.
    Abolish Private school subsidies . If you can afford to send children to a private school why should the rest of society subsidise your choice.
    Politicians super to be brought into line with the rest of society

     4 Like
  14. Shaun says:

    Negative gearing has be phased out. We have a heated investment driven housing market with an otherwise sluggish economy where interest rates aren’t as effective as they used to be.

    Eliminate as many GST exceptions as possible to simplify collection and broaden the base. Compensate low income earners appropriately.

    Rather than a Medicare GP co-payment, remove ‘futile treatments’ – those that are expensive but don’t lead to a measurable increase in wellbeing or length of life and reallocate these funds towards a medical research fund. Allow private health insurers to offer these treatments with an appropriate premium loading.

    As much as I’d like to support closing tax loopholes for global companies, has there been any modelling done to suggest how it would affect retail pricing – as I’m sure the companies would want to pass on the cost of any increased tax they pay here in Australia – effectively becoming another indirect tax on Australians. If the modelling demonstrates that there’s a strong case for closing the tax loopholes, I’d support it.

    The tax concessions for superannuation need to be thoroughly revised to provide maximum benefit from the dollars contributed by the government.

    We as a society need to stop looking at stay-at-home parents as ‘unproductive’ – income / tax sharing between spouse/partner needs to happen. It will reduce the pressure on the child care sector.

     3 Like
  15. Cathy says:

    Fringe Benefits Tax concessions for company cars increase car use in several ways:
    1. The greater the distance travelled in a company car, the greater the FBT concession.
    2. Staff car parking also receives FBT concessions.
    3. Public transport fares, bikes and sustainable travel allowances provided by employers do not attract any tax concessions.
    4. Cars can be salary packaged, but bikes, public transport tickets, and sustainable travel allowances cannot. This means that if employers want to give staff a choice between a fleet car and a higher cash salary, the additional cash salary will need to be higher than the value of the car to ensure that the after-tax salary is equivalent to the value of the car. This acts as a disincentive for businesses to allow staff to cash out their package.

    • Abolish FBT concessions for company cars and staff car parking.
    • Introduce tax concessions for public transport fares, bikes and sustainable travel allowances
    • Remove the ability to salary package vehicles, and/or allow bikes, public transport passes and sustainable travel allowances to be salary packaged

     1 Like
  16. mark says:

    Put GST on interest payments. (Implication; taxes leveraged risk takers, negative gearing, offshore tax funnels).
    Put 5% sales tax on top of GST (to catch apples, googles, amazons and MSs)
    Offer offshore/internet purchasers to pay voluntary tax upon each purchase at VT.au
    Pressure that it will be double tax plus costs should the ATO have to chase up unpaid VT.
    Give the same offer to corporations, offshore and onshore, double tax plus chase up costs for avoiding offenders.
    Refuse to sign any US TPP that weakens in any way our taxation powers.
    Let the public know that taking on the global corporate godfathers is difficult and that they will need to maintain support for taxation fairness (and its initiatory pollies) against all the powers of mainstream media.

  17. Charlie says:

    I would like to suggest that our tax system should abolish negative gearing and reinstate normal CGT tax rate on investment housing. Or at least apply negative gearing to new homes only, and reinstate normal tax rates for CGT on investment housing.

    Housing is human being’s necessity, not like any other investment that could be a kind of wants. Under the current system: negative gearing & CGT concession, it has caused the following problems:

    1:) Pushing the housing price to the sky, as such people have to rent and rents have to go high. It significantly worsens the rental crisis.

    2:) Kill overall jobs. People have to save as much as they can so that they can make mortgage repayments, or to save a deposit, pay rents etc. Overall consumptions is significantly deteriorated.

    3:) It makes the rich richer and the poor poorer. The overall tax and welfare system is significantly skewed.

    4:) It brings down our local birth rates since people can not afford a simple home.

    5:) Significantly increase the general business costs and downgrade its competition capability.

    6:) It also kills building industry’s jobs. Since most average people can not afford purchase, the demand is decreased. It also increases the cost of developers to buy land.

    7:) People with a mortgage are actually a housing slave. Average people’s life quality is very bad. Again many jobs are killed such as in travel industry, retail sector etc etc.

    8:) Government pays more for rental assistance for low income people and retirees. If people have their own home, government can save a lot.

    9:) Negative gearing sucks too much money from general economy and government revenue. If no such cost, government can use this money to fund huge tax cuts in general, no need to cut this bit, that bit – all small money.

    10:) Our young talents are moving overseas since they can’t afford a simple home here.

     6 Like
  18. Luke says:

    Employ the KISS rule. A tax system based on reward for effort, tax economic rents/unearned gains.

    *Implement flat % rate land value tax with no exemptions (family home, churches, farms ALL should be liable) allow LVT debt to accumulate against the property value until sold for cash flow poor retirees.
    *Slash company tax rate to 20%.
    *Cancel dividend Imputation across the board.
    *Cancel all tax incentives and reduce personal tax. A Tax free threshold should apply up to minimum full time wage,and adjusted each year inline with change in min wage.
    *Cancel 50% CGT concession.
    *Cancel all forms of stamp duties on property tfr and insurance.
    *Cancel all farming “bailouts” and ask farmers to insure against drought.
    *FBT should apply for all private use of cars.
    *Super profits tax on all resource rents and capital gains on property as a result of ‘rezoning’

     6 Like
  19. PhilipH says:

    Transform the household sector.
    Let PAYG tax payers split their income with spouse /partner to enable more families to fund a stay at home mum / dad.

    Allow the purchase of regular household services tax deductible. Nannys/ cleaning/ gardening. So this cash economy disappears. But you encourage more people to engage these services on a regular basis, grow the economy, grow the tax from this segment.

    Broaden the GST to all goods and services and raise to 12.5%

     5 Like
  20. F W Hayek says:

    It is clearly not possible to effectively income tax the rich multinationals, so why not increase the GST, and apply it to all goods they produce, even when purchased internationally – that way the Apples, and Microsofts will at least be contributing something. It needs to be made clear though, that it is not possible to tax our way to prosperity, if it was the watermelons would have already done so. Our problem is not a revenue one – rather it is how we waste it – time for some vice chancellors, and many other publicly funded bureaucrats to tighten their belts me thinks.

     1 Like
  21. Brian Halstead says:

    Imputation was designed to stop double taxation not to create zero taxation. Stop paying franking credits back to people who do not pay any tax.

    Only allow losses where expenses on a asset exceed the income from the asset to be claimed against other income for first three years and then they can be accumulated to offset profits when made before any discounting for capital gains.

    Stop the ridiculous situation where employees of NFP organisations can claim unlimited expenses of certain types against pre tax income.

    Start collecting in tax returns the total amounts received from super funds so there is firm base of information on these amounts. It will also show to individuals the amounts of income from all sources

     2 Like
  22. Allan says:

    Tradesmen who currently collect GST should not do so . Solution: every three months the tradesman emails tax office with the total of each job and the name , address and phone number , email address of the customer to tax office and then the tax office bills each customer with the GST . This leaves out the tradesman as an unpaid tax collector and results in the paid tax collectors doing their job and collecting the tax direct from those who own it.

     1 Like
  23. Jake says:

    State taxes –

    Remove thresholds on land tax. Maintain exemption on primary residence only. Land tax to be levied across all investment, commercial & primary production properties irrespective of entity ownership, and levied at the same rate.

    Remove stamp duty & payroll tax.

    Allow state governments to levy income taxes (which in turn would reduce the federal income tax rates), which would allow state governments to fund their own budgets and not be reiliant on federal grants. It would also bring competition between states.

    Federal taxes –

    Income tax – Striped to states (read above), with a top up federal income tax.
    – negative gearing only allowed on newly contructed premises
    – Capital gains discount to be reduced to 33% (instead of 50%)
    – Interest earned on accounts. Tax applicable only on half the interest earned.

    Dividend imputation – Change dividend impuation for superannuation accounts in pension mode. Adjust to a partial double taxation, say 50% is only refunded for accounts with more then $1,000,000 in value as at the beginning of the year. This would also create some form of incentive for pension accounts to hold more in safe assets (bonds, fixed income). There is to great of incentive for pension accounts to hold all assets in equities.

    Broaden GST to all goods & services. Leave rate alone for present.

    Excise tax – Alcohol tax to be simplified to a rate alcohol content

    Fuel tax credits/rebate – removed.

    Superannuation/pension – The system at present isn’t equitable. It also isn’t working to fund retirement for the majority. Remove lump sum payouts (except for medical/extra-ordinary reasons). Income streams the only way to access super. Preservation age to always match the pension age. The first $500,000 of main residence to be included in assets test for centrelink pension. If something isn’t done to the super system it may be better just to nationalize the whole thing.

     11 Like
  24. Andrew Rollason says:

    The GST is a regressive tax and should be repealed. The actual burden of GST falls most heavily on lower income people and those people who are in a period of dissavings such as pensioners and superannuants.
    Income Taxes should be raised accordingly.

    The income tax cuts from 2001-2013 were a structural mistake which has eroded the current taxation based. Bracket creep should be allowed to continue to normalise the effects of last decade’s taxation cuts, but at a gradual rate.

    As people who derive income from sources other than wages, such as dividends, rents, royalties, and the like, there should be a 10% surcharge on non-personal exertion income.
    The biggest contributor to inequality in society occurs when the rate of return of capital is greater than the rate of growth of wages. This idea has been explored by people such as Piketty and Buffett.

     3 Like
  25. Lisa White says:

    1. Abolish negative gearing.
    2. Reintroduce carbon and mining tax
    3. Introduce “buffett rule” (see getup for more information)
    4. Stop generous tax concessions into super and trusts.
    5. Be able to name and shame companies avoiding tax in Australia
    6. Reintroduce first home buyers accounts
    7. Legislate minium deposit required for home purchases (like in NZ)
    8. Legislate against companies avoiding their tax (like in the UK)
    9. Make publicly available all property sales (so buyers can’t withold them)

     6 Like
  26. Felix Goldschmied says:

    It is most likely that Australians will not be able to save sufficient amounts in their superannuation benefits given the effects of an aging population where there are more pensioners living longer.
    The solution lies in larger secure savings for the aged. The provision of adequate superannuation can not rest on the employer being asked to pay solely a greater percentage of employee wages as a result of Federal Government Legislation.
    The employee should contribute 50% of the superannuation out of pre-tax wages to a retirement fund.( say 8% of income) In return that employee 50% can be used once in a lifetime only to pay a deposit or purchase a house. Should the house be sold the money so invested together with a small nominal interest must be retuned to the superfund. All superfunds should provide an annuity type pension. The fund must be properly administered by an independent body which is not to be politicised and set up for that purpose. Self funded super funds should cease to be and be phased out immediately. Funds already in pension mode for nominated recipients should continue.

     2 Like
  27. David Harris says:

    Expand GST. Decrease assets thresholds for Part Age Pensions but give health care card to all over age pension age. Scrap negative gearing or at least only allow for new built properties. Simplify business tax to stop loopholes
    Give WA its full share of GST. Make GST rate easy to change as fiscal circumstances vary. Do not allow people to maximize welfare payments by ” rearranging ” their assets. Increase CGT. Stop family trust rorts.

     2 Like
  28. HJ Again says:

    Make it 20% GST on Pay TV, cigarettes, tattoos and booze, reduce income support for anyone who has these by the amount it cost them. They don’t understand the concept of “essentials” and I don’t want my taxes going towards keeping them sat down doing their “thing” at my expense.
    Make ALL Government support means based not ethnic or heritage based. I’d like the same sort of equality afforded to the indigenous population given to us all.
    review all penalty rates that pull down the productivity of the country. a 250% loading for working in a shop in Sunday doesn’t make the person worth that much more, it just reduces opportunity to work and to buy.
    Remove all trading hours restrictions, especially those that are different on different side of the same street.
    And sort out daylight savings across the eastern seaboard. If SE QLD had what it really should have the whole economy would go ahead. Instead we all hit the pillows at 8.00 pm even in summer because its so dark. Restaurants would do better, solar energy could be better used, travel to Vic wouldn’t be a night mare because when you fly out at 6.00 am you arrive at 11.00am, or have to fly the night before.
    Embrace the entire Harper review fully!

     3 Like
  29. Ryan says:

    Multi-nationals who shift profit artificially are ruinous to small business and startups who can’t do the same. If the G20 can’t adapt quickly, then we need to (eg, UK style). Said multi-nationals won’t leave Australia – they enjoy the profits they reap here too much.

    Don’t raise GST – it will hit lower income earners who are cautious about spending already. Ergo less money changing hands in the economy and a lowering in the amount we collect in revenue anyway.

    Land tax is an interesting idea that’s hard to dodge. It’s hard to hide a $2 million mansion. Also can be a value cut-off point to not harm lower income earners, and exemptions for retirees and pensioners (after all if you work hard all your life for a great home you should be able to keep it). Look into that.

    Moves to tax normally on high-wealth super is a good idea. Look into high-mid earners too (seriously, they’re in no danger of running out of money in retirement).

    Also surplus is great, but no business has ever managed to become successful by cutting costs. I doubt any government will either.

     1 Like
  30. Max says:

    My understanding that a tithe (10%) on all income however derived, with the sole exception of pensions, and with no allowances or tax-free thresholds would achieve a better income for the Commonwealth and be fairer all round.

     2 Like
  31. HJ says:

    1) Remove negative gearing. Its a rort.
    2) Increase GST, spread to private education and luxury processed foods – NOT FRESH FOODS
    3) Don’t penalise self-funded retirees. Include the value of family home for part value above the national average home value in asset tests.
    4) Give all self funded retirees a health card and nothing else. They’d stop messing with their assets as that’s what they really want.
    5) Abolish health fund subsidies let the funds stand on their own feet and fight a price war. Use that money to go to medicare
    6) Make all cancer treatments and investigations fully funded under medicare
    7) remove all vanity based elective surgery from medicare (nose jobs, boob jobs)
    8) make all essential dental care for under 16 and over 65 free
    9) make basic child care free at point of supply and stop messing around with who gets how much. Like an education.
    10) stop subsidising private/religious schools education

     7 Like
  32. dross says:

    I have a self managed superfund in pension mode.
    I would like to know how much more revenue is needed to bring the budget back to par without futher cuts to social services.
    I believe there is scope to tax the income of a super fund when in pension mode where the earnings exceed our needs which actually reduce as we age and yet we are obliged to take out an increasing amount each year that we only re-invest or use to assist our family. Compulsory superannuation was introduced to provide a livable income in retirement in lieu of the aged pension. Any amount earned over and above the aged pension could be taxed at say 15% without affecting living standards. But leave the return of the dividend imputation credits in place as an offset.
    Would this in itself be enough to meet the needs of the budget without tinkering with company tax and GST?

     1 Like
  33. Greg says:

    GST is a fair tax on all income levels. The current system is open to abuse and compliance/collection costs.
    GST should be on everything, compliance costs are reduced and policing of the revenue becomes easier.
    All GST should be paid to the ATO in the GST registered period example Someone or a business with a ABN should not be able to purchase an asset and pay the net of GST price to the seller, they should have to pay the full price and claim back the GST in the period the purchase was made. In this way the ATO would get the full GST being accounted for and would make compliance easier and less expensive to police in the tax system and be reconciled to end of year accounts in the Income Tax Return.
    The additional GST paid to the ATO would increase Government cash flow over over months before it is refunded to the taxpayer.
    The additional GST paid on everything could be targeted back thru the PAYG system to compensate low income earners but this most be done fairly and the income levels need to be reviewed on a regular basis.

     3 Like
  34. James says:

    Consumption tax. Get rid of all the other taxes and the ATO. That gets the rich to actually pay taxes, and gets the underground economy to pay taxes. The underground economy probably totals in the neighbourhood of 66 billion alone! It’s not any more complicated than that!

  35. Chris Leslie says:

    It would be nice to see a fairer system for Australians, all Australians, not just the richer.

    I’m willing to pay a little more because I can afford it. The idea of lowering income tax then increasing and broadening the GST would leave me better off, but it’s going to hit those who can least afford it the most.

    Stop giving those who can absorb an increase in tax a break while expecting the lower income earners to sacrifice even more of their total earnings just to keep the gap between the two well and truly there.

    We should be creating the conditions to help Australians, again all Australians help themselves, improve their standard of living and drive personal spending and economic growth. The idea of giving breaks to the richer and large corporations in the hopes they’ll do it for you just means more profit for them, taken out of our tax jurisdictions.

  36. John Ruddick says:

    If we had a tax free threshold of $100,000 profit for all Australian companies the economy would rocket.

  37. Jim says:

    Phase out negative gearing for established properties and grandfather it for existing investments.
    Treat the investment earnings of retiree super funds as income and tax it accordingly.
    Means test super contribution concessional tax rates against an individuals super balance. If the balance of funds is greater than 20 times the median annual income, then no concession.
    Apply a 0.1% tax on all electronic funds transfers in Australia – including stock, bond, and futures trading.

     1 Like
  38. WSB says:

    The loopholes that allow overseas companies to pay little or no tax should be closed. There should be more control on foreign ownership of housing property unless the owner is a permanent resident (This should be carefully monitored). Self funded retirees should not be disadvantaged unless the family home is valued at more than $2,500,000. Work for the dole should be increased with “National Service”, either community based or Armed Service by choice.

     4 Like
  39. Ashley says:

    Reduce income tax, reduce company tax, increase GST, broaden GST to all goods and services, introduce a broad based land value tax, remove negative gearing, remove the capital gains discount, cap superannuation to $2m, include the home in the assets test for the pension, abolish stamp duty, abolish payroll tax.

     5 Like
  40. Cameron says:

    Increase the GST to 15% or even 20%. This is a fair tax as it is user pays. Use this additional revenue to reduce state taxes such as land tax, stamp duty and fund education and health.

    Create a marginal tax rate on super contributions, similar in structure to income tax (eg a tax free portion, 15%, 20%, 30% brackets), but still keep it attrictive to save so that citizens will be self reliant in retirement.

    Put automatic increases on the marginal income tax thresholds, based on CPI to reduce bracket creep. Reduce the tax rates in line with the increased revenue above.

    Restructure company tax so that intra company transfers off shore are taxed at the standard company rate. If the profit is made here, then you pay tax here.

    Introduce National Service Scheme. If you want unemployment beneifts, you have to work for it. This could cover work anywhere in the community. Rather than giving money to organisations for assistance, the Government can give them workers. This will also give people experience and lead to full time employment and give them a sense of belonging to the community rather than being a burden. If they don’t turn up, excluding standard sick and annual leave requirements, don’t perform a satisfactory job or follow the requirements, then they don’t get the benefit.

    Stop selling government owned assets. We have lost long term revenue streams from short term gains.

    Look at what Australia can do be global contributers. We could create and export zero emission energy as an example eg wave, thermal, etc.

    We need to have governments which look forward more than their next term, like this initiative. People don’t always like change, but will aclimatise well to good initiatives.

  41. Nick Saverimuttu says:

    Reduce reliance on taxes that distort workforce participation, investment and savings choices. Increse taxes that have the least effect on the above. Deal with equity issues with means tested transfer payments.
    Reduce company tax to be internationally competitive, reduce income tax at lower and higher income levels, increase GST rate and base with minimal exemptions and compensate low income gouseholds through transfer payments.

  42. Matthew Addison says:

    Concentrating on the concept of a “simpler” tax system:
    We have many administrative steps in a business complying with tax law (amongst other laws) that absorb an unnecessary amount of time.
    Why do we have so many categories of GST: It should have been simple: GST or NOT. Instead for some strange reason that nobody has been able to justify we have Fre & INP & Not reportable etc etc.
    Ultimately GST should have been simpler – GST on everything by everybody. Therefore a simple system.

    Why do we have both TFN & ABN & then ACN for companies aswell? One entity identifier would prevent the confusion. The Privacy of a TFN seems to be an overcomplicated/overthought issue! What can happen if somebody uses by TFN – I get allocated some income by “the system” that isnt mine and I would prove it!

    Why do we have Tax returns that require information in a different form from Natural businesss systems? How about a business schedule in the tax return that looks like a profit and loss instead of something that has to be reworked?

    Why do we have a payroll tax system run seperately and differently by each state when it is simply a tax on employers that are known to the tax system anyway? (Also noting what a huge disincentive to growth for a business – payroll tax should be removed)

     1 Like
  43. Zena says:

    (Re)Introduce a price on carbon and address two pressing policy issues at once.

     12 Like
  44. KD says:

    scrap negative gearing. Totally. It’s a rort and even investors would admit to that. Housing should be a right for all and NOT investments for the rich. Banks should only lend on what people can afford I.e if you own 5 house with total monthly repayments of $20k then that’s what you should be able to afford. Not allow losses to be written off against tax.

     4 Like
  45. Emeritus Professor says:

    Stop the proliferation of taxes in Australia and charge everyone a flat rate of 10% on their “cash flow”. This would reduce the confusion which currently exists, and the Government should be forced to spend only the money that is generated by this method. 100% Australian owned Companies should not pay any tax, and partially foreign owned companies should pay a percentage tax based on their foreign ownership ratio.

    By putting more money back into the pockets of Australians they will have increased spending abilities, creating a greater demand for goods and services, resulting in increased employment, giving more people more money to spend etc.

  46. Daniel says:

    Increase land tax. Decrease income tax.

     5 Like
  47. JGK says:

    GST needs to increase and be levied on a broader base eg: education and financial services.

    Loopholes allowing foreign sellers to structure around having to charge GST also need to be closed.

    The CGT discount should be less generous as well.

  48. Wade MacRae says:

    A significantly increased reliance on land tax. Who could argue with a negative marginal excess burden? (only rent seekers)

    Obviously this should be just one part of a broader package of tax reform, but in the interest of keeping things short and sweet, this would be my ‘must have’ reform.

     10 Like
  49. Les Giovinazzo says:

    1. An enquiry into the larger companies that is being conducted at the moment will go a long way to a farer system. I only hope the Govnt has the guts to continue and go through with changes in taxing them at the rate they should be taxed. Close those loopholes.
    2. Don’t penalise those who have worked hard all their lives and managed to put away a few dollars so they are NOT a burden on the system by taxing them more in their retirement.

     2 Like
  50. Simon says:

    Start collecting more tax from multi-national companies who move profit overseas.

     3 Like
  51. Fox Mouler says:

    Abolish Negative Gearing totally.
    Abolish the 50% tax concession on Capital gains Tax on investment homes.
    Abolish tax payable on bank interest.
    Abolish Stamp Duties on home purchases
    Reduce income tax rates (to remove the dependency on the PAYG system)
    Increase GST to 12.5% or 15%.
    Introduce Land Tax
    Reform assets tests on pensions and include the family home where its > $1 million.
    Impose taxes on mortgages at banks rather than the depositors. (After all its the house lending that needs to be made secure-NOT deposits)
    Prevent recipients from receiving social security benefits until they have contributed to the workforce for 5 years prior.
    Prevent foreign investment from buying property in Australia. They don’t pay taxes or contribute to our economy, nor have they paid for our infrastructure costs that derives the price of property, so they should not benefit from owning our assets.

     6 Like

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