We need a 15% GST

[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).

[04redxr8]

Are you serious?? And which of those 4 categories do u fall into?

[atec77]

Originally Posted by 04redxr8

Are you serious?? And which of those 4 categories do u fall into?

The one he missed



goose

[galaxy xr8]

WTF!!!!!!, if only you knew what Tax people earning a decent wage pay !.
You obviously have no idea my friend.

[EFFalcon]

so we'd have more disposable income, but prices would rise.
end result, people spend more overseas importing goods :P

[Geez Louise]

Yeah I can see this thread ending well.

It is verging on the edge of the sites T&C's.

If you want to have a debate/discussion, at least know what the point is that you want to make first.

Cheers
Col

[DJL351]

A bit like Pauline's idea to just print more money......... Yeah sure!

[Keepleft]

Originally Posted by DJL351

A bit like Pauline's idea to just print more money......... Yeah sure!

Don't laugh, the US FED does it every minute of every day around the clock. Its called "quantitative easing".

Its effects are to screw the US bond market, adds to inflation, reduces the value of the US dollar and so petrol (for them and us) increases in cost, and then the US uses some of its 'strategic reserve' to reduce price, simply has OPEN smiling, - as the reserve has to be refilled - at the higher prices at some stage! Its all a bargain. The practice is an attempt to aid the US housing market, but it'll fall in a heap, further.....

[The Yeti]

yea the eazy tax system its (or variations off) have been debated many times I think Pauline was the last one to raise it

trouble is nothing would change the GVT wouldnt drop the income tax to the same extent and the dum shmucks (like me would still be paying through the nose)

just like all these other things according to to the Labour govt I'm a high income earner so my tax rate wouldnt change so I would get dun over again like the carbon tax compensation, the health insurance rebate, the K rudd hand outs, sorry I dont think this idea would work either

[turbodewd]

I dont know if any of you actually read and digested what I was suggesting. Im a former tax officer (1993-2000) now im an IT contractor at the ATO. I have a very good knowledge of the tax system.

In a nutshell I point out that most taxpayers like you and me pay normal amounts of income tax. While many pay none or not what they really should. I point out that noone can avoid GST when buying a TV.

So I suggest that GST increases, income tax goes down. The vast majority of people on these forums would be income taxpayers thru PAYG/PAYE.

Doesnt anyone here realise income tax is a giant game full of rorts, loopholes, etc? Its a joke.

[The Yeti]

Originally Posted by turbodewd

I dont know if any of you actually read and digested what I was suggesting. Im a former tax officer (1993-2000) now im an IT contractor at the ATO. I have a very good knowledge of the tax system.

In a nutshell I point out that most taxpayers like you and me pay normal amounts of income tax. While many pay none or not what they really should. I point out that noone can avoid GST when buying a TV.

So I suggest that GST increases, income tax goes down. The vast majority of people on these forums would be income taxpayers thru PAYG/PAYE.

Doesnt anyone here realise income tax is a giant game full of rorts, loopholes, etc? Its a joke.

it is a big game full of holes no question, but all raising the GST does is create a cash economy, where tradies do more Cash work and employ the services of other people in cash, the only tax you capture is on sales, not service and I think (Only an asumption) that atleast 50% of the money in our economy is for service based transactions

yea I get cranky when I hear people talking about how they split there income with their Mrs or understate their income and their business covers almost all of their living expences, but I dont see a 15% GST being the answer

[tweeked]

Anything that stop the Gummint continually thinking I am rich just due to earnings.

I always liked this old story

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100...

If they paid their bill the way we pay our taxes, it would go something like this...

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7..
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do..

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20". Drinks for the ten men would now cost just $80.

The group still wanted to pay their bill the way we pay our taxes. So the first four men were unaffected. They would still drink for free. But what about the other six men ? How could they divide the $20 windfall so that everyone would get his fair share?


They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.

And so the fifth man, like the first four, now paid nothing (100% saving).
The sixth now paid $2 instead of $3 (33% saving).
The seventh now paid $5 instead of $7 (28% saving).
The eighth now paid $9 instead of $12 (25% saving).
The ninth now paid $14 instead of $18 (22% saving).
The tenth now paid $49 instead of $59 (16% saving).

Each of the six was better off than before. And the first four continued to drink for free. But, once outside the bar, the men began to compare their savings.

"I only got a dollar out of the $20 saving," declared the sixth man. He pointed to the tenth man,"but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar too. It's unfair that he got ten times more benefit than me!"

"That's true!" shouted the seventh man. "Why should he get $10 back, when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.

[Magna]

Originally Posted by turbodewd

I dont know if any of you actually read and digested what I was suggesting. Im a former tax officer (1993-2000) now im an IT contractor at the ATO. I have a very good knowledge of the tax system.

I point out that noone can avoid GST when buying a TV.

unless they claim it on the business like the boss that gets a new FPV ute every year they claim the GST back and the rest is a tax deduction

[pottery beige]

off his head......

[turbodewd]

Some tradies do whole or partial cash in hand, so they avoid income tax. But they cant avoid the GST when they buy a TV or a hair straightener for the Mrs.

This is the simple point some are struggling with, they are happy to pay income tax while others rort it.

But noone can avoid the GST when u buy a box of condoms or a bullbar.

Id love to also abolish deductions and reduce the income tax rates accordingly. No more rorts.

[ego gtp]

Originally Posted by turbodewd

Some tradies do whole or partial cash in hand, so they avoid income tax. But they cant avoid the GST when they buy a TV or a hair straightener for the Mrs.

This is the simple point some are struggling with, they are happy to pay income tax while others rort it.

But noone can avoid the GST when u buy a box of condoms or a bullbar.

Id love to also abolish deductions and reduce the income tax rates accordingly. No more rorts.

Condoms are gst exempt if your going to start a thread with your so called fixes at least get your facts right

[PHATXR8]

Originally Posted by turbodewd

Some tradies do whole or partial cash in hand, so they avoid income tax. But they cant avoid the GST when they buy a TV or a hair straightener for the Mrs.

For someone who says they worked for years at the ATO and have a good understanding of the how the Australian tax system operates, you clearly know NOTHING about how GST operates. In fact you are a fraud.

When someone buys a TV or hair straightener they DO pay GST. Regardless of whether or not they pay with cash, cheque or credit card, the GST is still paid.

Hopefully there will be some mass sackings of IT contractors at the ATO when Juliar is booted out at the next election! There is waaaay too much taxpayers money wasted on nuff nuffs like you!

[cs123]

Originally Posted by PHATXR8

When someone buys a TV or hair straightener they DO pay GST. Regardless of whether or not they pay with cash, cheque or credit card, the GST is still paid.

I think he is talking about how some small business owners work cash in hand. It does happen. I've been offered 2 prices quite often, lower price for cash in hand.

[PHATXR8]

Originally Posted by cs123

I think he is talking about how some small business owners work cash in hand. It does happen. I've been offered 2 prices quite often, lower price for cash in hand.

Well if that is what he is talking about, increasing the GST to 15% will make no difference! An increase in the GST rate won't discourage current practices!

The guy who started this thread is probably a toilet cleaner at the ATO - he has no idea what he is talking about.

He initially said he was a "normal PAYG taxpayer", then later he said he was an IT Contractor at the ATO..... so what is he really?? His 2 different descriptions of his employment status are at odds with one another.

[flappist]

Originally Posted by PHATXR8

Well if that is what he is talking about, increasing the GST to 15% will make no difference! An increase in the GST rate won't discourage current practices!

The guy who started this thread is probably a toilet cleaner at the ATO - he has no idea what he is talking about.

He initially said he was a "normal PAYG taxpayer", then later he said he was an IT Contractor at the ATO..... so what is he really?? His 2 different descriptions of his employment status are at odds with one another.

Well the public service has "contracts" to employ people for a short period of time. They have the same conditions as permanent PAYG employees with the exception of preknown a termination date. They then renew the contract if they wish to.

It does have an advantage that they can make sure they only employ the dumb ones, after all if you show ability and aptitude you may be a threat to your manager's position........

[trippytaka]

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).

Haha good luck selling that one.

I agree completely.

I would push it further, drop income tax tosuper low flat rate for people under 200k income. Then increase GST right up to 20%.

Also, delete nagative gearing - 1.3m properties negatively geared in Aus means billions of tax $ not being generated.

Take it back to a you earn it, you keep it. But you spend, you pay it! System.

[RedHotGT]

Why don't we close the loopholes for the super rich... Rather than punishing the entire country?

[turbodewd]

Originally Posted by loftie

Why don't we close the loopholes for the super rich... Rather than punishing the entire country?

Yep, thats another part of my suggestion, abolish deductions. But there are these fancy family trust things, which i dont fully understand, this is what the super rich use to massively minimise their tax. I cant blame them.

But what Im suggesting is that when they buy a Ferrari or a yacht, they cant avoid the GST. The car retailer charges GST and collects it and sends it to the ATO. Its far easier to audit 100,000 businesses than 10 million taxpayers.

Its normal police officers, teachers and bus drivers who carry the tax burden in this country.

[flappist]

Originally Posted by turbodewd

Yep, thats another part of my suggestion, abolish deductions. But there are these fancy family trust things, which i dont fully understand, this is what the super rich use to massively minimise their tax. I cant blame them.

But what Im suggesting is that when they buy a Ferrari or a yacht, they cant avoid the GST. The car retailer charges GST and collects it and sends it to the ATO. Its far easier to audit 100,000 businesses than 10 million taxpayers.

Its normal police officers, teachers and bus drivers who carry the tax burden in this country.

Yep you are right about one thing....YOU DO NOT UNDERSTAND.

A few points:

1) The primary deduction for any company is.....wages. So what are you going to do for money when you are sacked?

2) Even if it were 1,000,000% GST it is only the PAYG people who will cop it in the neck not the self employed or company directors. Every single car I have bought since 2000 has had the GST claimed back immediately. A PAYG person cannot do that so increasing it will hurt the ones you are try in help.

3) The people you are trying to hurt are the ones that are actually making the system work. If you slam private business as has been done in USSR, North Korea, Cuba, most of Africa you will get exactly the same result.

Maybe you think everyone should be equal to you in your PAYG job? Fair enough. Of course shops, pubs, petrol stations and whatever else will only open from 9 to 5 on week days because to have to work outside those hours is not fair.
No TV or Radio at night, that is not fair.
There will be no credit so you have to save up and pay cash up front for EVERYTHING.
You will not get any more many than anyone else regardless of how hard you work or what you do and you can only drive the same car as everyone else othewise it is not fair.

The most expensive thing in a business in the whinging employee.....YOU.

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?

[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.

[Franco Cozzo]

Originally Posted by flappist

17.5% loading

That isn't compulsory anymore is it?

[DJM83]

Originally Posted by Big Damo

That isn't compulsory anymore is it?

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

[Yellow_Festiva]

Originally Posted by loftie

Why don't we close the loopholes for the super rich... Rather than punishing the entire country?

Because they will just get better lawyers and accountants. Failing that, they will take their money offshore.

Either way, they will still get their way, and the rest get punished.

Remember, our system is far from 'fair' (and that will NEVER change)... it is just one that fits best.

Some will win, some will lose.... such is life.

[pottery beige]

some jobs i've payed shed loads of tax.. enough to support a few dolies and five or six single mums.... yea i feel i need to be slugged more for my maccas........

[msman]

Originally Posted by EFFalcon

so we'd have more disposable income, but prices would rise.
end result, people spend more overseas importing goods :P

Originally Posted by turbodewd

Some tradies do whole or partial cash in hand, so they avoid income tax. But they cant avoid the GST when they buy a TV or a hair straightener for the Mrs.

This is the simple point some are struggling with, they are happy to pay income tax while others rort it.

But noone can avoid the GST when u buy a box of condoms or a bullbar.

Id love to also abolish deductions and reduce the income tax rates accordingly. No more rorts.

you make an good point in theory but putting it into practice would result in what effalcon has said.
so i don't think it is workable. points for trying though.