We need a 15% GST

[TZENU]

It'd be nice to have a more simplified taxation system... Afterall, Australia has one of the most complex tax systems in the world... I suppose it keeps accountants in a job, so I shouldn't be complaining

[EFFalcon]

Originally Posted by turbodewd

flappist,

im a contractor, I dont get a cent if Im sick with the flu.

1. Im talking about about income tax for individuals, not companies.

2. I advocate abolishing all deductions so you couldnt claim anything. Why not add up the value of the deductions that people claim and reduce the income tax rates by that amount. There are clever boffins at Treasury who can do those sums/calcs. You could then abolish half the ATO and save taxpayers millions.

3. A hysterical point mentioning North Korea.

You have to realise Im on everyone's side here, Im onthe inside at the ATO, I see how much taxpayer funds goes to waste administering ridiculous systems. All our Aussie dollars go overseas to administer our tax systems - HP, Optus (Singtel), Accenture and Lockheed Martin.

So youre happy to have a tax system which rips policeman and teachers off? Which sends millions overseas?

The tax system is broken badly and it costs taxpayers dearly. The GST is the best tax weve got.

the ATO isnt the only place with stupid amounts of government funded overheads... just about any public service is full of it.

[Riksta]

How bout we just bring in a system I thought of years ago, kind of like a "you choose where your tax dollars go" system.

Where 30% of your tax goes instantly to the government to do what they see fit, the other 70%, you CHOOSE where it goes.

No kids? 0% to education. Sick of dole bludgers? 0% to Centrelink. Sick of the nations highways and the state they're in? They can have 20% of my user chooses, along with the health system in case I get sick.

This way, people will be able to stop complaining about the government "wasting" their tax dollars, because most of it is going where they want it to go.

[flappist]

Originally Posted by turbodewd

flappist,

im a contractor, I dont get a cent if Im sick with the flu.

1. Im talking about about income tax for individuals, not companies.

2. I advocate abolishing all deductions so you couldnt claim anything. Why not add up the value of the deductions that people claim and reduce the income tax rates by that amount. There are clever boffins at Treasury who can do those sums/calcs. You could then abolish half the ATO and save taxpayers millions.

3. A hysterical point mentioning North Korea.

You have to realise Im on everyone's side here, Im onthe inside at the ATO, I see how much taxpayer funds goes to waste administering ridiculous systems. All our Aussie dollars go overseas to administer our tax systems - HP, Optus (Singtel), Accenture and Lockheed Martin.

So youre happy to have a tax system which rips policeman and teachers off? Which sends millions overseas?

The tax system is broken badly and it costs taxpayers dearly. The GST is the best tax weve got.

If you are a contractor with an ABN then if you were to, for example, buy a GT-P for $88k you immediately get a tax input credit of $8k. If the GST were 15% the car would be $92k and you would get $12k back.

A PAYG worker cannot do this so by increasing the GST the PAYG workers cop it in the neck and it does not affect you at all.

A "deduction" is an indirect cost on a business.

So this is how it works and to make it simplw tax will be fixed at 30%:

I build a shed and sell it to you.
The materials cost me $10,000.
I pay $5,000 in labour.
I sell it to you for $ $20,000.

From the $20,000 I claim $5,000 + $10,000 deductions and show a nett income of $5,000 which means I pay $1,500 tax and keep $3,500 for myself.

Under your scheme of no deductions I would pay $6,000 tax which means I would actually lose money so I would have to put the price up to over $26k to make the same money.

In the first case YOU (not me as you are supplying all the money) have paid $1500 tax in the second YOU are paying $7500+/- tax.

This is on top of the PAYG you have already paid.

It is very obvious that you really have no understanding of the tax system or accountancy and if you actually are a contractor you are just contracted to supply labour or services to a single department or entity so as to allow them to sack you at a moments notice rather than go through all the drama and oncosts.

[GT0132]

Originally Posted by flappist

YOU get 9% super, 17.5% loading, 4 weeks paid hols, sickies, workers comp, lunch break, smoke breaks and all the other little bonuses that private business owners do not.

Are you prepared to give all of that up to reduce the tax burden on others?

And the last question, I see you live in Canberra, you are not a public servant, the greatest money sink in the country, are you?

Flappist

You've said this many a time over the years and I have to agree that the overheads and paperwork imposed on business makes employing staff an extremely painful process if not a nightmare - no argument from me on that one. However you seem particularly frustrated by it - moreso than others I have encountered in business. It must eat you up and can't be good for your health..Maybe sell up your business, (I assume you're in one), sack your staff and then become one of those employees you despise so much and then enjoy the fruits you're missing out on and have that well deserved holiday , with the leave loading included.

To the OP

Tax reform should start with a full overhaul of trusts and the usage of them. Asset protection, while all trustees will say this is the prime motivation for establishing them , is BS...and we all know that they are primarily used for income splitting.

Leave GST alone.

[comagutsa]

no need for GST carbon Tax is coming

[turbodewd]

flappist,

youre about to kiss me.

Lets go to your shed example.

If I controlled the tax rules i would drop the tax rate to 7.5% but apply that tax to your whole $20,000 income you received.

7.5% tax on $20,000 is $1500

This leaves a profit of $3500 to you.

See how simple it is?!

For income tax reform we find out the value of all the deductions that all Aussies claim. Then abolish the deductions and reduce income tax rates to equal that value! then you can shut 80% of the ATO and most tax agents go the wall.

[GT0132]

Originally Posted by turbodewd

flappist,

youre about to kiss me.

Lets go to your shed example.

If I controlled the tax rules i would drop the tax rate to 7.5% but apply that tax to your whole $20,000 income you received.

7.5% tax on $20,000 is $1500

This leaves a profit of $3500 to you.

See how simple it is?!

For income tax reform we find out the value of all the deductions that all Aussies claim. Then abolish the deductions and reduce income tax rates to equal that value! then you can shut 80% of the ATO and most tax agents go the wall.

That disadvantages businesses running on thin margins....What if I only make 10% on my cost of inputs?

ie cost of materials and labour $20k, sale price $24k...I would currently pay tax of $1,200 being 30% of the $4k profit. Are you saying I will now pay $1,500 being 7.5% of 20k?

I can't agree with your logic.

[04redxr8]

Originally Posted by turbodewd

flappist,

youre about to kiss me.

Lets go to your shed example.

If I controlled the tax rules i would drop the tax rate to 7.5% but apply that tax to your whole $20,000 income you received.

7.5% tax on $20,000 is $1500

This leaves a profit of $3500 to you.

See how simple it is?!

For income tax reform we find out the value of all the deductions that all Aussies claim. Then abolish the deductions and reduce income tax rates to equal that value! then you can shut 80% of the ATO and most tax agents go the wall.

You really have no idea. Maybe you need to get out of the bubble and join the real world.

[GhiaEB]

What about pensioners and self funded retiree swho paid tax their entire lives thinking that at their retirement they wouldn't have to pay anymore. Now they 10% tax on everything they buy!

These people built this great nation long before you were born and are still being taxed for it!

[colin55]

They should scrap most taxes and just have a "GST" at X% to make the country work. Then not allow any tax deductions. That would simplify the tax system.

There should only be one income tax bracket at X%, the more you earn the more $$ you pay anyway, why the hell does a high income earner have to pay a higher % tax. This country has got to stop penalising the hard working to help those that refuse to work. (I understand there are some legitimate claims)


I also think they should have a sliding scale income tax/tariff, to hold import/ local production near 75% local 25% import.

[flappist]

Originally Posted by colin55

They should scrap most taxes and just have a "GST" at X% to make the country work. Then not allow any tax deductions. That would simplify the tax system.

There should only be one income tax bracket at X%, the more you earn the more $$ you pay anyway, why the hell does a high income earner have to pay a higher % tax. This country has got to stop penalising the hard working to help those that refuse to work. (I understand there are some legitimate claims)


I also think they should have a sliding scale income tax/tariff, to hold import/ local production near 75% local 25% import.

Another one that does not get it.

You do realise that YOU are a tax deduction or should your wages be taxed TWICE, once before you get them and than again afterwards.......

[turbodewd]

Originally Posted by GhiaEB

What about pensioners and self funded retiree swho paid tax their entire lives thinking that at their retirement they wouldn't have to pay anymore. Now they 10% tax on everything they buy!

These people built this great nation long before you were born and are still being taxed for it!

GhiaEB,

alas its not that simple. You are unaware that the GST replaced the [22%] sales tax system. The 22% applied to the wholesale price. But there were also 12% and 32% rates. It was a very complicated system. I know, I worked with it from 1993-2000.

[GhiaEB]

Originally Posted by turbodewd

GhiaEB,

alas its not that simple. You are unaware that the GST replaced the [22%] sales tax system. The 22% applied to the wholesale price. But there were also 12% and 32% rates. It was a very complicated system. I know, I worked with it from 1993-2000.

I know it replaced (State) sales tax. It was also meant to repace alot of state taxes, like stamp duty.

Alot of items that were not taxed got a 10% tax on them also. To offset the added tax we got a income tax break, something alot of people on fixed incomes can not recive. We all remember the fuel excise decrease to offset the GST and how well that worked. That in itself is a tax on a tax.

[flappist]

Originally Posted by turbodewd

GhiaEB,

alas its not that simple. You are unaware that the GST replaced the [22%] sales tax system. The 22% applied to the wholesale price. But there were also 12% and 32% rates. It was a very complicated system. I know, I worked with it from 1993-2000.

It was MUCH MUCH simpler that GST.

There was a wholesale sales tax that was paid by the wholesaler. Only wholesalers had to worry about sales tax returns.

No input credits, no BAS, no tax on labour and the tax department was less than a quarter the size it is now. 98% of businesses just bought stuff and sold it with a single tax return at the end of the year. Now even small employers with maybe 5 staff need a full time person to do the books and have an account bill that approaches 5 digits.

I know, I worked with it from 1977 to 2000 in rural, medical, hospitality, non profit as well as ordinary commercial industries.

[04redxr8]

Originally Posted by turbodewd

GhiaEB,

alas its not that simple. You are unaware that the GST replaced the [22%] sales tax system. The 22% applied to the wholesale price. But there were also 12% and 32% rates. It was a very complicated system. I know, I worked with it from 1993-2000.

But dont certain items still have a sales tax attached?

[Adamz Ghia]

I don't see why everyone is going nuts over this idea. While clunky in parts, it's not a bad idea and our tax system is broken, unfair and expensive. From memory the GST was to replace dozens of state taxes but the states never actually got rid of them. Maybe it's time the feds followed this up. Yes I just laughed at myself too...

But I'm also of the mind that if someone is able to reduce the amount of tax they pay without breaking the law, then good on them. Doesn't matter what tx system you bring in, someone will always find a hole in it.

[jmack]

how about we all work for nothing and get a bowl of rice 3 times a day.why should i be crucified for the wage that i have studied and worked hard for .sick of being screwed over by govs still waiting for last years tax reurn when they get teir $$$$ into gear

[cheap]

Originally Posted by turbodewd

As a normal PAYG taxpayer I find it annoying that the following groups avoid or minimise massively their income tax:

super rich
crims
small business operators
those in the cash economy

Now at least they cant avoid the GST when they visit a restaurant, buy a TV or a Big Mac.

Now if I was in charge Id bump up the GST to 15% so these people actually pay some tax. I would also work out the value of this tax increase and reduce income tax accordingly. Try to make it revenue neutral. But we would see less tax paid by PAYG taxpayers and more by the above groups.

Now if need be we could use some revenue to help retirees, bump up their pension to offset the slight increase in prices (4.5% theoretically).

So what is stopping you joining the evil 'small business operators'?

Take it form me running a small business is so easy and the money just comes in (like magic) so much money that I use $50 notes to light my cigars and the whole family wipes our bottoms using $100 notes.

[Lukeyson]

Originally Posted by Riksta

0% to Centrelink

Don't do that, I be out of a job !!! lol

But yeah the old wholesale tax system was easier !!

[Franco Cozzo]

Originally Posted by flappist

17.5% loading

That isn't compulsory anymore is it?

[jmack]

how about we all work for nothing and get a bowl of rice 3 times a day.why should i be crucified for the wage that i have studied and worked hard for .sick of being screwed over by govs still waiting for last years tax reurn when they get teir $$$$ into gear.....sorry take no notice of double up comp played up and cant work out how to delete

[GhiaEB]

In what state, in WA if shift workers penalty is higher then leave loading, they now get their shift penalty instead of the 17.5% leave loading. I.E of you work nights and get 30% penalty, when you go on leave you get 30% instead of 17.5%.

I hated it when I was working nights and when I went on holidays I would get less than when working my normal hours.

[StockieXR6T]

I haven't read the whole thread but I tend to agree, in that income tax might as well be reduced or eliminated in exchange for a higher GST, so many uber wealthy pay little of no tax, Lindsay Fox was quoted saying he didn't pay tax. like many very wealthy they an afford creative accounting. They do however buy more stuff so it is a way of getting money off them. Honestly if income tax was zero, and food staples were tax exempt and the GST was the only tax at 30% who would be better of and who would be worse?

Those who earn the most tend to pay the the least at the moment with the working class majority paying all the tax.

Joel

[DJM83]

Originally Posted by Big Damo

That isn't compulsory anymore is it?

Nor does it apply to everyone. I don't get it.

[svo supporter]

The beginning of the thread said it all. The rich get richer the poor get poorer.

Bump the GST up, businesses will bump the prices of goods up. So Mr and Mrs consumer have to pay more for goods.

So how does that help Mr and Mrs poor? Makes them poorer, whilst the richer get richer.

Good idea, I think not.

[Auslandau]

Originally Posted by turbodewd

So youre happy to have a tax system which rips policeman and teachers off? Which sends millions overseas?

Tax system rips teachers off? WTF?????? My other 1/2 is a teacher and we LOVE her tax returns ..... in fact that's out holiday (my car) money.

I am one of your 'evil' small business owners. I get around 10% of her return every year ...... but happily manage to keep 10 other families gainfully employed while I juggle all the repayments, pay my BAS every 1/4 etc. Not whinging about it by any means but really ....... your OP is offensive and typical of some who LOVE to knock those who work hard and are successful. What scares me even more is you work in the ATO. Just goes to prove how rooted we are.

Agree .... GST is good but absolutely hate being the collector of monies for the g'ment.

[Cookie-XR8]

As a "evil" small business owner. I don't get out of paying tax, I still have to pay an income tax on what ever money I withdraw from the business. Plus a gst bill every quarter that would pay for lots of dole bludgers, and I'm still broke.

[Cookie-XR8]

Originally Posted by Auslandau

Tax system rips teachers off? WTF?????? My other 1/2 is a teacher and we LOVE her tax returns ..... in fact that's out holiday (my car) money.

I am one of your 'evil' small business owners. I get around 10% of her return every year ...... but happily manage to keep 10 other families gainfully employed while I juggle all the repayments, pay my BAS every 1/4 etc. Not whinging about it by any means but really ....... your OP is offensive and typical of some who LOVE to knock those who work hard and are successful. What scares me even more is you work in the ATO. Just goes to prove how rooted we are.

Agree .... GST is good but absolutely hate being the collector of monies for the g'ment.

Haters Gunna hate. I'm doing 14 hour days 7 days a week to make my small business work, hard work pays off in the long run tho.

[Geez Louise]

As I understand it, the OP contracts to the ATO.

There is a big difference between someone who "Contracts" for the ATO and someone employeed directly by the ATO. Just wanted to clear that up