[LINK] Why so many of us think we're overtaxed
Tue, 25 Feb 2003 17:05:34 +1100
My problem with that argument is that the poor do pay a higher
proportion of the income in tax, and that's something that tends to
be forgotten. The GST for example takes a bigger proportional bit out
a poor man's income than it does a rich mans's income. Other indirect
taxes also take a similar punch out of their wallets.
To me the BIG problems with the tax system are:
1. The income tax system (which accounts for more than 50% of
collected revenue) is very heavily geared toward the middle and
lower income groups. Anyone ... and I mean anyone ... who is on a
half way decent income can 'invest' in any number of tax minimisation
schemes and rorts. (Being in this bracket I don't begrudge that fact
... hey the WestMinster decision make sit obligatory for us to
minimise tax ...but I do find it strange that our tax scheme
basically promotes investment strategies that are geared to LOSE
money to save tax ... it directs our economy into a weirdly
dysfunctional investment strategy where we often lose more than we
gain in tax saved - and people see that as OK?.)
2. There is little or no accountability for the disposition of the
revenue raised. Broadly speaking funds tend to find their way into
whatever avenues whatever pluralist lobby has managed to press our
jellified politicos the hardest ... or dependent on the rather
jaundiced view of what our politicos have to the perceived
self-interest of that section or segment of the population that votes
3. What funds do make it into laudable projects for the public weal
and investment in the future (via infrastructure projects, transport,
health system, education system or whatever) tend to be dissipated in
short term by lack of accountability, responsibility and often
down-right corruption in the administration of same and award of
contracts and the like. Some constitutional guarantees of
accountability and responsibility pertinent to public funding would
4. Politicians promises (which basically have to do with how
collected revenue will be spent) mean nothing after the election.
There is NO revenue accountability enforced on politicians.
5. There appears to be a lot of hypocrisy inherent in the system ...
the big users of public resources (government, industry, business,
professional bodies etc) seem to think it's OK for the middle to
lower income groups to fund their use of the revenue paid for
resources, whilst requiring (screaming for) less and less
contributions from themselves. If they really believed in 'user pays'
they wouldn't be contributing a progressively lesser amount to the
tax revenues annually. (eg. Company tax has shrunk as a percentage of
the income tax take for the last 10 years ... despite these years
being economic boom years, and despite the fact that with dividend
franking shareholders now benefit from companies paying tax.)
'Socialise the costs and capitalize the profits' is the order of the
6. The average user now gets less for his tax dollar than he ever
did.'"User pays' justifies the withdrawal of previously free or
subsidised government service (health, education, transport etc), but
the revenue take goes up and nobody has any idea of what accounting
black hole the revenue disappears into. (Debt repayment, reserve bank
foreign currency speculation, industry assistance etc)
7. Previously revenue raising public infrastructure (power,
telecommunications, gas, etc) is privatised for a song, and customer
fees for same have increased far faster than the CPI ... and these
additional costs represent an additional taxpayer burden that would
have qualified as a tax in the days when the infrastructure was
publicly administered, but don't under current accounting rules. (In
the 'good old days' a lot of the tax we paid went to 'subsidise' this
infrastructure .... but now it just disappears into the
aforementioned 'black hole' and consumers pay the added cost for a
third party's profit.)
The bottom line is that taxpayers see they are paying more tax ...
hey, all the government revenue figures (state and federal) support
that ... but are also conscious that they are getting less for it,
and paying proportionately more for, previously government provided
but now private, infrastructure services without seeing any increase
in service quality and extent. The 'rationalist' arguments are
starting to look very hollow to the vast majority of the Australian
That is what irritates people. The amount of tax they pay is secondary.
Gittens did do a service though in pointing out that we aren't overly
taxed as compared to other countries.
Just my 2 cents worth ...
At 2:03 PM +1100 25/2/2003, Bernard Robertson-Dunn wrote:
>Craig Sanders wrote:
>> absolutely. the thing that really struck me during the debates that
>> raged over the GST-fueled tax cuts a few years ago, was that the most
>> obviously fair tax cut wasn't considered or discussed seriously by
>> anyone - i.e. raising the tax-free threshold to a reasonable level (IMO,
>> a "reasonable level" is around $15-$20,000, much higher than the current
>> level of just under $6000).
>I have a problem with the tax free threshold.
>People who don't pay tax would have no ownership of the funding of the
>country and it could promote an outsider culture.
>It's bad enough having the rich and powerful feel that they are outside the
>system, I don't think much good comes from even more believing that
>"normal" rules don't apply to them.
>Everybody should contribute to the upkeep of the community, that way they
>are more likely to feel they belong.
>The tax collector must love poor people, he's creating so many of them.
>-- Bill Vaughan
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