The Coalition’s inability to address taxation reform is as exasperating as Dutton’s refusal to address the plight of those incarcerated on Manus and Nauru. The answers are there but blind ideology and political cowardice are stopping the government from adopting them.
Malcolm Turnbull has stated that taxation should be used to encourage desired outcomes and, in that, we agree.
Unfortunately, the current tax system offers us the wrong incentives. It punishes mothers who return to work, encourages us to retire early, overtaxes bank deposits while rewarding debt with unlimited deductions, and encourages us to invest in driving up house prices rather than fostering start-up enterprises or investing in infrastructure.
Only wage and salary income remains fully taxed; the system offers investors many ways to dodge tax on their earnings, and offshore tax havens are adding to the options for corporates. Until we plug the tax avoidance loopholes, talk of where the company tax rate should be set is irrelevant.
Basically all experts agree that any reform package that didn’t tackle the sacred cows of Australia’s tax system, such as negative gearing and the privileged tax treatment of superannuation, capital gains and family trusts, is unfair from the outset.
These are luxuries we can no longer afford, not only because of the cost to the budget, but because they skew investment into unproductive areas and contribute to inequality by driving up house prices.
Average wealth for households who are renting is about one-eighth of owner-occupiers who own their home outright and about one-fifth of those who have a mortgage.
It isn’t the wealthy who need tax cuts.
The top 20% of households owned 62% of total household wealth in 2013–2014. By comparison, the bottom 20% of households, owned less than 1% of all household wealth.
Malcolm Turnbull already has the Sword of Damocles hanging over his head. A true leader could grab this opportunity to work with Labor and outsmart his internal opponents. He could choose an honest, moral, fair minded approach and cut Murdoch out of the equation. He and Bill Shorten could work together to make public sentiment snowball until other politicians and interest groups dare not stand in its way.
Instead of wedging each other, why not wedge the ambitious right-wingers, the self-serving lobbyists and the extremists by actually working together to implement change. If they did that, threats to cross the floor and demands from crazy crossbenchers become irrelevant.
You have a choice Malcolm, to go out with a whimper or a bang. I so wish I thought you had the courage to surprise me.
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