Existing taxes no longer enough - Treasury head

Dogmatix

Dogmatix

Active Member
Existing taxes no longer enough - Treasury head
http://www.watoday.com.au/national/...ger-enough--treasury-head-20120816-24bfd.html

THE head of the Treasury, Martin Parkinson, has raised the prospect of new taxes on presently-untaxed activities, saying the days of big budget surpluses are gone forever.

In a sombre assessment of the tax position - the second in a fortnight from a senior Treasury official - Dr Parkinson said Australia would soon be unable to meet demands for new government spending from its existing taxes.

"These are expected to deliver less revenue as a proportion of GDP, given capital and labour will become more mobile and the costs of securing that revenue will increase," he told the Committee for the Economic Development of Australia.

"In addition, greater use of the tax bases we currently rely most heavily on - personal and corporate income tax - can adversely impact on productivity, participation and investment if not designed well."

The Treasury Secretary's warning against attempting to squeeze more out of existing taxes did not extend to the GST.

This month Rob Heferen, head of Treasury's revenue group, said Australia undertaxed the consumption of goods and services compared to other developed nations but said "a sustainable rebalancing" would need to gain public acceptance.

Dr Parkinson said that "with hindsight" it was apparent the Howard government's run of surpluses during the mid-2000s were the result of "a temporary bubble".

Australia's terms of trade have since peaked and economic activity is shifting into forms that cannot be as easily taxed.

The result was ''the days of large surpluses being delivered by buoyant tax receipts are behind us'', he said.

"While economic activity rebounded quite quickly after the global financial crisis, tax receipts are expected to remain substantially lower - around $20 billion per annum lower at the Commonwealth level alone - than pre-crisis projections."

This was happening as rising incomes propelled Australians to demand more of government. So called "superior goods" such as health, disability care and education were becoming more important. The ageing of the population would exacerbate the pressures.

"We will not be able to meet these demands for new spending by increasing the efficiency and effectiveness of existing government spending alone, although this is important in its own right," Dr Parkinson said. "Nor can we rely solely on our existing tax bases. What will be required to meet the community's demand for new spending will be more revenue or significant savings in other areas.

"In short, the public will need to make thoughtful decisions about what it wants government to provide, and how it expects these things will be provided."
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I bolded parts for emphasis.

The last line:
"In short, the public will need to make thoughtful decisions about what it wants government to provide, and how it expects these things will be provided."

If only! Then again, i wouldn't want a mis-informed public making decisions about Govt services, else we get Centrelink 'bonuses' or something more ludicrous.
 
I know, lets give every Australian living or dead $900 so they can waste it on what ever they please and then rip the guts out of the rest of the country so it has no healthcare, the elderly can't afford anything then we will tax the crap out of them through carbon and watch the country implode.

Yeah vote 1 Labor...........
 
Here's a pretty radical idea that seems to work for BHP, Coles, my local cafe etc - REDUCE SPENDING. Ffs it's not rocket science.
 
Jonesy said:
Labor is completely responsible for this situation.
Take a look at this list and understand how we went from rich to poor...

http://www.electionnow.com.au/?cat=6
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I would put the kneejerk Live Cattle export ban at the top of the list (together with Gillard's Great Untruth).

Millions of dollars lost and family's businesses and livelihoods either detroyed or damaged in the beef industry.
 
Demand that pollies take a friggin paycut ... and audit themselves for wasteful spending practices (after all it is our money).



LMAO .. like thats ever going to happen
 
I say we should go the other way and ELIMINATE ALL TAXES, everyone would instantly move up a class. We then get rid of 90% of the Government and the remaining 10% can function solely on Tariffs and Duties like it used to do. The extra cash in the public's hands would be spent as each person sees fit and the extra spending would create more than enough jobs for all those Government workers that were just layed off to get productive private sector jobs for the benefit of all Australians.

It's not rocket Science is just going back to a time in our Country when you could have a family of 6 or 7 on one income and before the Government got corrupted and f@#ed everything up!
 
tozak said:
I say we should go the other way and ELIMINATE ALL TAXES, everyone would instantly move up a class. We then get rid of 90% of the Government and the remaining 10% can function solely on Tariffs and Duties like it used to do. The extra cash in the public's hands would be spent as each person sees fit and the extra spending would create more than enough jobs for all those Government workers that were just layed off to get productive private sector jobs for the benefit of all Australians.

It's not rocket Science is just going back to a time in our Country when you could have a family of 6 or 7 on one income and before the Government got corrupted and f@#ed everything up!
Click to expand...
+1
 
And lets start calling Labor what it actually is - The political enforcement arm of the Trade Unions. We basically have a large version of the HSU running the economy and the government and the result of this is what we now have to deal with.
 
tozak said:
I say we should go the other way and ELIMINATE ALL TAXES, everyone would instantly move up a class. We then get rid of 90% of the Government and the remaining 10% can function solely on Tariffs and Duties like it used to do. The extra cash in the public's hands would be spent as each person sees fit and the extra spending would create more than enough jobs for all those Government workers that were just layed off to get productive private sector jobs for the benefit of all Australians.

It's not rocket Science is just going back to a time in our Country when you could have a family of 6 or 7 on one income and before the Government got corrupted and f@#ed everything up!
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+ 1

I will second those thoughts!!
 
I think the white elephant in the room was overlooked again - not only in the article, but also in the thread.


We have a full 20% of the entire Australian population currently in the process of moving from net tax payers to net tax takers - either financially or through government sponsored support programs.

The government has already tried to pay for the aging population by taxing the youth through massive property manipulation and lending deregulation and now that well is running dry, right when the exodus of the aged population from the work force starts putting real pressure on government expenditure.

This is not a question of left or right wing politics people - you need to stop thinking in such simplistic, divisionary paradigms and face simple reality here.

Governments are bound my popular, democratic decree and the bottom line is that there's been decades of increasing largess bought and paid for on credit, forced by political majority vote.

The time to rectify the fault of policial and fiscal largess by both sides of govenment were passed up when they had the opportunity because it wasn't politically viable, so now you have a situation where you simply cannot win.

The populace is already in massive debt as a collective, our retail sector is in decline, debt burden is wiping out savings and investment and the only solution the government has to offer here is to further the problem with more theft through taxation.

Understand that at the end of the day it's a numbers game and no one in political power today has either the foresight or the courage to stand up and tell the population that you have to start taking personal responsibility.

Instead, they're going to continue to steal from the dwindling minority of productive producers to pay for the rest until it all collapses.
 
I'm going to preface this by saying I'm not Labour nor Liberal.

But the govt has grown a great deal in the years under Howard. All those liabilities taken on by the govt were predicated on Australia's continued growth. That continued growth was predicated on a worldwide financial credit bubble.

I have no love for Labour. They would have and in fact were following the same path before they were replaced by Howard.

It's fine to say that labour are irresposnsible, which they are, but anyone pretending that the Liberals are doing a good job of it is in lala land.

It might be that you can say Liberals are better at running ponzi schemes than Labour is. Although, I think it has more to do with timing and luck than anything else.
 
Dogmatix said:
...said "a sustainable rebalancing" would need to gain public acceptance.
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the rebalancing needs to be prevention of spending by government, not further taxation

the public needs a new institution through which spending is directly approved by the public

Treasury is incompetent
 
auspm said:
Understand that at the end of the day it's a numbers game and no one in political power today has either the foresight or the courage to stand up and tell the population that you have to start taking personal responsibility.
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Why would they? There are no votes in that. Ron Paul has proved that, if it needed proof.

The public don't want personal responsibility. They want to be looked after. They think they can pass responsibility for their lives to a bunch of crooks and liars and not have there be adverse consequences.

Most people aren't thinking.

EDIT: syntax
 
hawkeye said:
I'm going to preface this by saying I'm not Labour nor Liberal.

But the govt has grown a great deal in the years under Howard. All those liabilities taken on by the govt were predicated on Australia's continued growth. That continued growth was predicated on a worldwide financial credit bubble.

I have no love for Labour. They would have and in fact were following the same path before they were replaced by Howard.

It's fine to say that labour are irresposnsible, which they are, but anyone pretending that the Liberals are doing a good job of it is in lala land.

It might be that you can say Liberals are better at running ponzi schemes than Labour is. Although, I think it has more to do with timing and luck than anything else.
Click to expand...

It might seem that way, but Howard's government set the RE fire ablaze with FHOG one

There is bipartisan support for taxation, but neither side is prepared to downsize dramatically and allow earners to keep their earnings
 
millededge said:
It might seem that way, but Howard's government set the RE fire ablaze with FHOG one

There is bipartisan support for taxation, but neither side is prepared to downsize dramatically and allow earners to keep their earnings
Click to expand...


The FHOG was initially implemented to counter the argument that the introduction of GST would instantly make houses 10% more expensive.
 
"In short, the public will need to make thoughtful decisions about what it wants government to provide, and how it expects these things will be provided."
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(My emphasis).

Its interesting to see that while the government (specifically the Treasury) is telling business it needs to be chasing productivity gains, there seems to be some soul-searching about what the government itself should be doing.

How about...increasing productivity?

Not just doing more with less but doing the same with less.

Start by getting rid of state governments. They don't do anything that the Commonwealth and local councils couldn't split between them and we could slice a whole layer of fat straight out of the middle.
 
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