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Tag Archives: GST

Random thoughts

When Malcolm Turnbull called for a vote on the Liberal leadership in 2009, Tony Abbott eventually won by one vote.  One of Malcolm’s supporters was in hospital at the time and was not given a proxy vote, but more interestingly, one person just wrote “NO” on the ballot paper.  Whilst I can understand not being pleased with the choice on offer, what I cannot understand is how a Member of Parliament can so abrogate their responsibility as to vote informally when they are possibly choosing the future Prime Minister of Australia.

*****

The carbon price was introduced to encourage polluters to clean up their act or pay the price.  Why was this cost then passed on to consumers on their power bills?  It seems to me that the polluters got off scot free and that their customers actually footed their carbon tax bill.  They should have achieved the savings they needed by reducing their pollution rather than charging us.  If the government really wanted to reduce the power bills for the average Australian, why not make domestic power bills GST free since businesses can already claim the GST back?

*****

If you look at the entire worldwide cosmetic industry, sales reach about $170 Billion dollars a year. It’s distributed pretty uniformly around the world with ~$40 billion in the Americas, ~$60 billion in Europe, ~$60 billion in Australia & Asia, and another $10 billion in Africa. The Western world spends a bit more per person but India and Asia are quickly catching up.  What an absolutely ridiculous waste of money and resources on making people feel inadequate.

*****

Why do footballers hug and kiss and cry so much nowadays?  Remember when a handshake just involved extending your right hand to your opponent rather than clasping them to your bosom in a heartfelt embrace?  Have you noticed how many athletes have emotional problems?  Or gambling or substance abuse problems?  Paying sports people millions of dollars to play a game has led to huge pressure on individuals, organised violence to win, cheating, match fixing, doping, infiltration by organised crime.  Does a soccer player contribute more to the world than a nurse or a teacher?

*****

Finland has the best education system in the world but they do things quite differently to us.  Perhaps we could learn a few things from them (though they did ban Donald Duck comics because he doesn’t wear pants).

  • School starts at 7 years
  • No homework for young children
  • No exams until you turn 13
  • All classes are mixed ability
  • Max 16 students in science class
  • Lots of break time every day
  • Teacher training to masters level
  • Teacher training is paid for by government

*****

Approximately 3.5 million people in the U.S. are homeless, many of them veterans.  At the same time, there are 18.5 million vacant homes in the country.  The situation is similar in Europe where more than 11 million homes lie empty while 4.1 million people are homeless.  In Australia, at the 2006 census around 10 per cent of housing stock was recorded as vacant yet there are over 105,000 people who are homeless.

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The United States, Liberia and Burma are the only countries not to adopt the metric system.

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Time for a coffee

Factional fighting

imageThe title of this article is Murdochesque in that it may have inflamed anger you are already feeling, but the article that follows won’t provide what the titillatory heading implies.

I am not going to discuss Shorten vs Albanese or Abbott vs Turnbull.  I am not interested in Left vs Right or misogynists vs misandrists.  I am talking about us, we Aussies, regardless of who we voted for or where we were born or if we are rich or if we have breasts.

We have different past (and current) grievances which we could argue endlessly about who said what and who is to blame for current circumstances but where does it get us?  What are we achieving by planting ourselves firmly in one camp and refusing to work with the ‘enemy’ in a constantly backward looking blame game?

For three years we listened to Tony Abbott deny the legitimacy of the previous government.  We watched the behaviour in (and out) of Parliament degenerate into a slanging match which was reflected by the atrocious treatment of Julia Gillard.

Regardless of whether you agreed with the policies of the day, we allowed our first female Prime Minister to be bullied and slandered in the most despicable way.  This would not have been tolerated in any other workplace.  Nor would it have been allowed to continue at a school.

And the truly chilling thing was that this was led by people in public life.  Coalition politicians and lobbyists actually suggested violence with comments like “slit her throat” from our now Parliamentary Secretary to the Treasurer, Steve Ciobo, or “they should be out there kicking her to death” from John Howard’s former chief of staff, Grahame Morris.

Tim Wilson, our new Human Rights Commissioner, said on Lateline last night that we must take personal responsibility and shine a light on dark places.  Aside from the fact that it was in the context of saying that victims of discrimination and harassment should know their rights (human/moral, not legal) and stand up for themselves without legal protection, I agree at least with the sentiment that we should all try to set a higher personal and collective standard.

It is reasonable to examine what a politician has said or done in the past only in so far as it informs their current view and future direction.  This constant waste of time in Parliament speculating about possible illegalities is pure manipulation and obfuscation.  If someone has acted illegally or improperly then there are procedures to deal with that and appropriate bodies to pursue the matter.

The blatant trial by media of Slipper, Thomson and Gillard was echoed (or led) endlessly in Parliament.  As the police were apparently investigating all three cases, I fail to see how this was in any way productive, and it was unquestionably prejudicial to any future legal case.  It was a blatant attempt to destroy the reputation of three people, one of the few things mentioned by Tim Wilson as something that must be legislated against.  Aside from this, it was an inexcusable waste of precious Parliamentary time.  We are paying them to govern the country, not to pre-empt the judicial system.

I accept that the Coalition was voted into government by the majority of Australians and is therefore the legitimate government of the day.  I do not accept that this means that the other parties and Independents must change their policies.  They represent people who voted for them and should give alternate views a voice.  But we need the courage and skill to be able to compromise, to identify common goals and a path towards them.

What I find harder to accept, but have been forced to, is that the Liberal Party actually believe that Tony Abbott is the best person to lead them and the person of most merit to fill the position of Prime Minister.  After such a resounding victory at the last election and their incessant commentary about leadership tensions within the Labor Party, there is no chance that Mr Abbott will be replaced so we are stuck with him and must learn to accept that.

This makes negotiation much harder as Mr Abbott is that rare combination of a populist idealogue.  He is in the process of silencing dissenting voices or expert advice that does not suit his agenda and is appointing people who represent only one side of society – that of big business.

Governments are the only protection that the people have from the greed of big corporations whose aim is to maximise their profits.  Business plays to the umpire so if he isn’t calling offside then they will encroach as far as they can.  Mr Abbott has made his ideology clear by sending off most of the other team so that is the political climate we must deal with.

There is no point sitting here in shock, or wallowing in self-pity, or screaming in indignant rage.  We need to do what our politicians seem unable to do and that is to remember we are on the same team.  We must listen to each other.  We all want a better Australia.  There is a common starting point that we can all agree on surely.  If we accept that we all have that common goal then we can move to the next step.

Simply put, the role of government is to provide services and protection.  They have many tools at their disposal to fulfil this role but before looking at the ‘how’ we should identify which services we need and what is most important to protect.  Can we find common ground there?

Do we agree that we must protect the environment?  Do we agree that we must protect our children?  Do we agree that we must protect jobs?  Do we agree that we must protect our national health and pharmaceutical benefits scheme?  Do we agree that we must provide equal opportunity for education and skills training?  Do we agree we must provide a safety net for the disadvantaged and vulnerable?

If we can agree on the desirability of those goals then we can discuss how to achieve them regardless of what colour guernsey we wear.  We should stop the hate and start building solutions.  We have to open dialogue with people who think differently, ask them what they want to happen, and then find a way to get there that makes us both happy. Can we listen and help each other achieve what we want?

One example is climate change.  Half of the population are in favour of urgent action, the other half are worried about their electricity bill.  So we have to find a way to reduce power costs whilst acting on climate change.  As I suggested previously, this could be achieved by making electricity GST free.  I invite comment about this idea because it seems a compromise that satisfies both aims.  It is also so simple it should be easy to sell to everyone.  The only group that lose out are the government who will have reduced GST revenue but if they kept the carbon tax they would have an extra 7 billion and would save over 3 billion by not having to pay polluters.  They would also save money on review committees and if they kept the Clean Energy Finance Corporation they would collect the profits of about 200 million a year.  Surely over 10 billion should cover any loss of GST.

Can we agree to

MAKE ELECTRICITY GST FREE

 

A dog that’s had its day

John Howard

A guest comment by R James

In a week when the Federal Opposition has accused the Government of resurrecting Kevin Rudd in the hope that he will restore the government’s electoral prospects, the conservative opposition has itself turned to former Prime Minister John Howard in the hope that he can save the Coalition under the weight of Tony Abbott’s stewardship.

John Winston Howard appeared Saturday June 29 2013 at the Federal Coalitions American style electoral rally in Melbourne, preaching from the conservative bible to the largely converted, offering nothing but slogan’s and contradictory reviews of the Labor Governments performance. It was only a few weeks ago that this former Prime Minister weighed into the economic debate with full praise for Prime Minister Julia Gillard and her treasurer Wayne Swan’s management of the country and its finances. In view of his attacks on the Federal Government at Saturdays rally, is it possible that the former Prime Minister is developing dementia in retirement? History does record that he has suffered memory loss in the past (along with some of his senior ministers and coalition partners) – during the oil for food fiasco; the now former Liberal Prime Minister (and others, like Mr Vaile – who is nowadays a strong advocate for CSG and fracking in northern NSW) declared (at the time) that they had no memory of selling wheat to Iraq, while our boys and girls (along with the sons and daughters of our allies) were over there fighting in a war that was started over a lie. The man was extremely lucky not to have been detained and charged with war crimes . . . his role in declaring war against a sovereign state on the flimsiest of evidence, when others were telling him that there was no conclusive evidence that Saddam Hussein had weapons of mass destruction, lead to the ongoing slaughter of thousands of innocent people and the removal and execution of a head of state.

In an effort to counter the return of Rudd, the Opposition turned to a man who was only the second Prime Minister in history to lose his seat in a federal election. A man who the major credit agencies and the IMF have identified as Australia’s ‘Spend thrift’ Prime Minister: the most excessive and reckless manager of Australia’s finances in living memory. He lavished taxpayer dollars on his own interests, while telling the electorate that it was in their interest; such as $8,000 on a wine connoisseur to educate him on what wines should be served when entertaining visiting diplomats and dignitaries; new décor for the Lodge and in his last term of office; thousands of tax payer dollars to refurbish the recently upgraded commonwealth jet which he used to ferry him back and forth across the country while holidaying in Broome, Western Australia . . . concurrent to all of this, his government introduced ‘Work for the dole’ (citing that the unemployed must not sponge off the taxpayers . . . that is the reserve of politicians). This was the man who burdened the people of Australia with the all invasive GST – with the pledge that it would destroy the black economy . . . along with the promise that with its introduction his Government would remove a raft of other levies and hidden taxes (but none were ever removed) and there at their rally, they the Liberal’s had the bare faced gall to wave placard’s declaring that they represent ‘lower taxes’ and a fairer society. History tells that their concept of a fairer society is the wealthy exploiting the poor at every opportunity. Conservative corporate heads strive to strip their workers of all entitlements and safety provisions so that their company can run on the smell of an oily rag . . . its all about profit, not philanthropy . . . they aim to have one man working and six waiting at the door to fill his place, when he collapses through exhaustion or ill health.

They are and always will be the manipulators of the little man, the average man and are not worth trusting under any circumstances . . . not unless you are blind to what has happened in the past and what is happening else where in the world at these times.

Rupert Murdoch, where’s the outrage?

You may recall that one of the fabricated fears planted in people’s’ minds before the last election was that a Labor Government would raise the GST. Those of us who remember the perceived threat may also remember the public outcry expressed by readers who left comments on popular sites like Rupert Murdoch’s news.com.

Someone, somewhere, dreamt up that Gillard would raise the GST, the papers ran with it, and public outrage followed. Now who would have raised such an idea? Given the negative aspects and the timing of the alleged threat I’m sure the Liberal camp might have had a small bit to play in it. I’m sure they might have been a little bit bemused that there were genuine calls to have it raised, with many of the callers being the end of town that party with the Liberals party.

The calls became more vociferous leading up to the Tax Summit.

But you may ask: “Why should we raise such a repressive tax?”  Well, there were a number of reasons mooted at the time.  Independent MP Tony Windsor started off with the most simplest of these.

Tony Windsor has suggested the GST should rise by 1 percentage point to allow 115 “inefficient” taxes to be eradicated.

Mr Windsor and fellow crossbencher Tony Crook . . . called for the GST to be examined . . . following Treasury warnings that the tax has become increasingly inefficient.

Mr Windsor’s suggestion was in the wake Treasury’s executive director of revenue Rob Heferen’s statement that the GST was costing more to collect than other taxes and was “less than robust” because of increased spending on tax-free items.

The OECD Centre for Tax Policy and Administration highlighted the “practical reality” of an increase, being that it was essential to achieve many of the reforms recommended by the government’s tax review (The Henry Review) of 2009.

“There would seem to be a fairly compelling logic to GST base broadening and a slightly higher rate (eg 12.5 per cent) as a means of rationalising the major state taxes and compensating low-income citizens who would otherwise be unfairly impacted by GST expansion,” said the centre’s senior adviser Richard Highfield.

Viewing the current tax system as unfair and inefficient, accounting bodies also put their weight behind the call.  Among them, CPA Australia suggest that:

. . . increasing the GST to 15 or 20 per cent, accompanied by cuts to business and personal tax rates, would improve the economy and raise the standard of living. “Our research helps demystify concerns that an increase in GST would hurt Australians,” CPA Australia chief executive Alex Malley said.

But the sharpest call and strongest argument comes from the big end of town; the business groups with the Australian Industry Group leading the call.

The Australian Industry Group is urging an increase in the rate of the GST – or  a broadening of its application to more goods and services – as a way to pay for  the removal of inefficient state taxes.

The Ai Group – whose chief executive Heather Ridout was involved in  the  Henry tax review – says the states and territories have among the most  inefficient and poorly designed of all Australia’s taxes.

Ideally, the group says, insurance taxes and conveyancing duties would be  removed and payroll tax remodelled or removed. Land tax could be improved  substantially.

Compliance costs could be reduced by harmonising remaining state taxes, and  economies of scale exploited by using the Australian Taxation Office to collect  state revenue.

A more broadly based or higher  GST should finance the removal of as many  existing state taxes as possible, it says.

I found it rather interesting, that during the scare campaign the Murdoch media, in particular, were wheeling out all sorts of experts calling for the increase. In the minds of the readers raising the GST would be a good thing and Labor would fall prey to this meme.

In numerous media releases leading up to the tax summit the Government clearly ruled out the increase, or that it will be tabled for discussion. To do so would have been political suicide. It may have also been seen as an easy solution to return to surplus, even though it clearly would not have been for that purpose. It was a mute point that the Government had been widely criticized for not heeding many of the recommendations of the Henry Review, namely from those critics who sit on the opposition benches.

I was opposed to the introduction of the GST and the manner in which the Howard Government hoisted it upon us, as many people were. But it is with us, and despite its obvious flaws it nonetheless could unwittingly be the vehicle that will be used to overhaul the inequalities of the current tax system. However, this was unlikely to happen because of the negativity around the GST during the last election campaign and the Government’s reluctance to pursue the matter, particularly as it is in the minds of the electorate that the Labor Government has been painted as the party most likely to raise the GST if it ever were to be raised.

Fast forward to 2013 and Tony Abbott’s budget reply speech and this widely unpublicised comment:

We will finish the job that the Henry review started and this government squibbed.

Now, didn’t the Henry Review recommend an increase in the GST? Rupert, your papers were in a frenzy the last time an increase was put in the public sphere and the outrage against the Gillard Government was carefully nurtured.

Where is the outrage now?

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